Brent Council Tax rise of 4.99% in each of the next 2 years and no raid on reserves, recommended by Scrutiny Panel

Two main measures come up every year in the budget discussions in Brent when trying to mitigate the impact of lower government funding of local government.  One is the raising of Council Tax and the other is using some of the Council's reserves.

The Budget Scrutiny Panel has come out in favour of raising Council Tax and against using reserves to help fund services.

COUNCIL TAX

The government has give local authorties the power to bring forward the permitted Council Tax rise for social care so that the total amount is spent over the next two years (3% for 2 years then none in the third year) rather than 3 years. In addition there is the permitted, without a referendum, increase of 1.99% for other services.

The table above shows that this creates the need for almost £14m cuts in 2019-20. The next local elections are in 2018 so the incoming adminstration will have to administer those cuts.

The Panel argue:

Increasing Brent’s Council Tax by 4.99 per cent in the next couple of years could have a significant impact on the Council’s ability to continue to deliver these services as clearly demonstrated in the table above.

Of course, the Budget Scrutiny Panel was also acutely aware that it would be the ordinary residents of Brent who would have to pick up this tab.

The median income for residents of Brent is £33,482, significantly lower than both the outer London (£37,366) and inner London (£41,428) medians. We therefore have a special responsibility to ensure that the level of our Council Tax is not punitive.

Fortunately, it seems that Brent has so far met this obligation as our Council Tax is at the lower end of the spectrum in comparison to other London boroughs.

We recommend that over the long-term Brent keeps a close watch on its position in this table to ensure that our Council Tax level does not rise out of kilter with the rest of London.

However, in the short term we believe that a Council tax rise would be affordable for most of our local residents, particularly with Council Tax Support which ensures those on eligible benefits only pay 20 per cent of the tax.

To put into context:

·      A typical Band D property will currently be charged £1101.24 a year in 2016/17 (this 
is the Brent charge and excludes the GLA precept) 


A rise of 4.99 per cent would add £55.07 to this bill 


This would cost the tax pay a little over a pound per week 


This appears to presume no change in the Council Tax Support  Scheme.

RESERVES

The Panel argue:

The Council currently has unallocated reserves of around £12m. The Panel are comfortable with this level and do not propose taking money out of reserves to make up for losses in the Council’s grant.

The Council still faces many financial risks, from global factors in an uncertain political world, to local issues such as the increasing demand generated by the ageing population of Brent and the potential increase in demand for social care.

Should all of these risks to come to fruition the Council would only have reserves to cover the attendant costs for a couple of years. This is of course unlikely but reserves exist to cover the unlikely and we believe it would be imprudent to reduce them.

The Panel make a series of recommendations that will be discussed at Resources and Public Realm Sccutiny on Tuesday 10th January 7pm Civic Centre.  There is much more background discussion in the Full Report which can be found HERE

RECOMMENDATIONS

This report has presented the Budget Scrutiny Panel’s views on a wide range of topic attending to the budget. The report should be read as a whole with suggestions and ideas to be pulled out of almost every section. However, the key recommendations for reform which we would like to highlight are as follows:

1.     In future, any further proposals to reduce spending in Council budgets should be thoroughly evidence-based, with research into the likely impact on service users from any such change. The Council will need to be flexible and open-minded in looking at the most effective ways to deliver better services to Brent residents for the lowest possible cost. 


2.     The current demand-led review of Brent’s CPZ should be expanded with the aim of delivering a settlement for the whole of Brent which will be sustainable over the next twenty years to give further financial certainty to the authority. As part of this, the idea of day time visitor windows should be particularly investigated. 


3.     A report outlining all large-scale developments in the recent and upcoming years should be brought to the appropriate Scrutiny Committee in three months’ time. This would emphasise how mixed used each development was and allow scrutiny members to take a view on whether the balance is currently correct. 


4.     The Council should be forceful when dealing with TFL and seek to maximise business space in tube stations and use every development of a tube station as a potential to attract a new business to Brent. 


5.     A single “Business Attraction Manager” post, perhaps accompanied by a small team, should be set up in Brent. This would be a none-departmental role with the responsibility of attracting business to the borough and incentivised financially to achieve this without become a new financial burden to the Council. 


6.     Brent should seek to coordinate all local public sector bodies to develop a standard set of pre-qualification tests for procurement opportunities to make it easier for local firms to bid for work. 


7.     We believe that Cabinet should reconsider proceeding with proposal 1718BUD6 which would introduce charges (for) a more rapid collection of bulky waste, due to the reputational risk to Brent. Specifically, officers should model whether better signposting to other local services, including those within the authority, could deliver similar savings.

Budget Scrutiny Panel oppose bulky collection charge

The Budget Scrutiny Panel has asked the Council to think again about introducing payment for bulky waste collections.  The amount to be saved is relatively small at £250,000 and I suspect it may have been put in as one of those token items that the Council can revise after the budget consultation to show that it has 'listened' to residents.  But maybe I just have a suspicious mind.

The original proposal was very vague regarding the actual level of charges so it was hard to see how the sum of £250k had been arrived at. It appeared to be offering a faster premium service if residents were prepared to pay a charge:

The proposal is about introducing a differentiated charging scheme for the removal of bulky items, retaining some level of free service, so that:

·      operating costs are recovered 


·      a popular service can be sustained 


·      waste disposal volumes are better controlled 


·      demand is better regulated 


·      waiting times are reduced; and

·      monies received can be re-invested in the service 


How would this affect users of this service? 


Customers may notice altered operational arrangements and revised service terms and conditions. In some instances, service users would need to pay for the removal of bulky items or make alternative arrangements for disposal.

The Panel Report states:

The Panel had severe concerns about this proposal, primarily focused around the potential reputational damage to “Brand Brent” for what is a relatively small saving.

We understand that this proposal is designed to offer a “gold standard” option for people who wish to dispose of bulky waste items. In essence rather than wait the current standard period of time of around six weeks for a free collection they can pay to have the items removed sooner. However, as the policy is stated on the detailed options paper this is less than clear and could be interpreted as restricting the right of local people to have their bulky waste collected by the Council. This is a sensitive political area and we feel that when speaking about this subject the Council needs to be extra careful to get its messaging right so no misinformation gets into the public arena.

We are not confident that the Council has fully modelled the potential cost of an increased level of illegal rubbish dumping which may occur if people come to believe that they will have to pay new costs to have their bulky waste taken away. This could undermine the overall level of savings. 

Overall, the Panel felt that similar savings may be achievable by better sign posting people to other agencies who collect waste for free, including the growing number of furniture and electrical charity shops, or charities which provide furniture and white goods to people on low incomes.

This will not be a simple task. Council staff will have to be trained to give absolutely accurate information to ensure that residents do not become frustrated or feel they are being misinformed.

An example would be a local person ringing the Council to ask them to take away a sofa. The resident would be informed that they can wait up to 6 weeks for the Council to take it away, or call their local British Heart Foundation store who could take it away more quickly and for free. The Council operative would have to be sure from the call that it was an item of furniture the charity shop would take, and have the correct number for the shop as well as knowing the areas it collects from etc.

Similarly, Council departments would need to work together even more closely to ensure that products offered for collection to the environmental teams are passed to the benefits teams when people are in need of second hand goods for their homes.

We believe that this investment in time and training would be worthwhile as it would not only reduce the number of collections the Council needs to carry out but also reduce the amount of waste going into landfill which incurs a Landfill Tax charge to the Council. It would also have the wider social benefit of promoting re-use and recycling as first options in even more circumstances.

Fraud & error risk in Brent Planning Application process found by auditors

An internal audit report into Brent Council's planning application process by PriceWaterhouseCooper (PcW) has given only a 'Limited Assurance' rating and identified  high and medium risks of error or fraud. The report LINK which was submitted in November 2016 will be discussed at the Audit Committee on Wednesday January 11th 7pm at Brent Civic Centre.

In the last year there have been major staff changes in the Planning Department. Both planning and regeneration come under the Strategic Director for Regeneration and Environment.  Recently the lead member for Regeneration, Growth, Employment and Skills, which also covers planning policy,  Cllr Roxanne Mashari, resigned from the Cabinet earlier this month to be replaced by Cllr Shama Tatler.

The summary states: (my emphasis highlighted in yellow)

A new management team has been in place since May 2016 and there was evidence of some improvement being made to the system of controls within the planning application assessment process. However, our review did identify significant weaknesses in the planning application review and assessment process due to issues in the design of automated and user access controls with the system used to process planning applications, Acolaid. Issues identified around the system audit trail, user access rights and system enforced controls in place mean that the system is highly susceptible to manipulation and abuse through inappropriate or fraudulent activity and action should be taken immediately by management to strengthen the controls embedded within the system. We have included on page 4 a summary process map identifying the key weaknesses within the overall control system. 

Based on the findings identified by this review we are only able to give Limited Assurance over how the risks covered by this review are being mitigated. Key findings

•       The audit trail supporting the completion of key planning tasks is driven by the user selection from a drop down field that any user can amend rather than being automatically recorded based on the username within the system who has actually processed the task. The audit trail, including evidence of key approvals in the planning application process, may not accurately reflect who has actually performed the task and could be susceptible to manipulation to hide inappropriate activity. 


•       The system does not enforce segregation of duties between key parts of the planning process such as the initial assessment of the application by a Planning Officer and the subsequent approval by a Planning Manager. 


•       Roles and responsibilities are not fully aligned to access rights within the system. There are 9 levels of user access rights in the Acolaid system. Those responsible for granting/amending access rights were not able to define what access rights these user profiles permitted. 


•       Acolaid system user access rights have not been regularly reviewed by management. There are 739 user IDs listed on the Acolaid system. 429 (58%) users had not used the system since 30/3/2016 at the time of audit (01/08/2016) consisting of staff that have left the Council or who no longer require access to Acolaid. There is no effective mechanism in place to identify users who have left the Council or no longer require access to the system and withdraw access rights accordingly. 


•       There is no evidence an anti-bribery risk assessment has been completed for the Planning Department and anti-bribery awareness training has not been provided to planning staff. The Council may not be able to demonstrate that it has taken steps to prevent bribery resulting in non-compliance with the Bribery Act 2010 which could result in reputational damage and prosecution under this legislation. 


•       The Council officers a pre-application advice service in relation to prospective planning applicants. Advice issued should be subject to review in advance of being issued. 7/101 (7%) of pre-applications had been processed and reviewed by the same person. 


Given the  multi-million value of planning applications in Brent and the fact that for several years now, as pointed out on this blog, major decisions are delegated to the head of planning, this is an area of obvious concern.   As with any Audit Report an action plan has been devised for each area of concern but councillors will need  to step up their scrutiny of the internal working of their own department to ensure it is fit for purpose.

An immediate question that springs to mind is whether, historically, any fraud may have taken place or major errors made?  Are any investigations planned into past planning application decisions in the light of this report? 

The report states:

Planning Officers are bound by the Royal Town Planning Institute's Code of Conduct, which includes competence, honesty and integrity as key principles. However, this does not include any specific requirements regarding anti- bribery. We reviewed the Council's Anti-Fraud and Bribery Policy and found:

•   The Council has committed to maintain adequate and proportionate procedures to prevent bribery, undertake anti-bribery risk assessments and make all employees aware of their responsibilities to adhere strictly to this policy at all times; 


•   An anti-bribery risk assessment for the planning applications process and anti-bribery awareness training has not been provided to staff; 


•   A planning code of conduct is in place for members, however this does not include provisions relating to officers. We note that the code of conduct is currently being redrafted to include officers; and 
Planning Officers are required to flag any potential conflicts of interest in processing planning applications on an ad-hoc basis, but there is no requirement to make formal written declarations and a register of interests is not maintained.

These are the risk assessment findings:

HIGH RISK Approval of planning applications: System-audit trail and workflow

The Acolaid system does not accurately record the allocation and completion of work and the audit trail is susceptible to manipulation. In addition the system does not enforce segregation of duties for key parts of the process and system access rights do not reflect roles and responsibilities. As a result planning applications may be approved without the prerequisite review and approval in line with roles and responsibilities in place. This could result in planning applications being approved inappropriately due to fraud or error. 


HIGH RISK Acolaid System use access

System access rights do not reflect current roles and responsibilities. Individuals who do not require access to the system or have left the Council have access to the system and are able to make inappropriate changes to records and standing data due to fraud or error. 

MEDIUM RISK Anti-bribery arrangements

The Council is not able to demonstrate that it has taken steps to prevent bribery resulting in non-compliance with the Bribery Act 2010 which could result in reputational damage and prosecution. 
Inappropriate decisions are made regarding proposed planning applications due to bribery and undue influence. 


MEDIUM RISK Pre-application advice

Insufficient segregation of duties and independent review of pre-application advice may result in poor quality advice not being identified and resolved or inappropriate advice being issued based on the scope of services that can be provided at the pre-application stage. 


MEDIUM RISK Management Information Control design

There is insufficient performance information available to management to facilitate effective oversight of operational performance. Operational issues are not identified and resolved in a timely manner.

Greens expose unviability of London Mayor's 'viability team' on affordable housing

Sian Berry London Green Party Assembly Member has revealed that the London Mayor’s new ‘team of viability experts’ will consist of only two people, which is not enough to challenge the huge resources of developers.

The new team will be based in City Hall and will examine figures submitted by developers when they fail to meet the Mayor’s targets for affordable homes.

However, in response to a written question from Sian Berry, the Mayor has said the ‘team’ will be made up of just two people.

He also failed to give reassurances that they would be permanent staff and not on short term contracts that allow them to move back and forth between public and commercial work that could bring conflicts of interest.

Sian Berry said:

The Mayor promised a team of experts and Londoners need more than two people in these posts if the Mayor’s goal of challenging developers is to be viable. I am very concerned that two people, however talented, will be stretched beyond capacity and unable to make a real difference.

There’s already too much of a ‘revolving door’ for consultants between big developers and Council regeneration schemes, and it’s vital that these experts do not also have commercial interests while working on behalf of Londoners.

The new team needs to be expanded quickly and this should not be done by hiring in consultants on short term contracts, but by building up a dedicated and permanent expert team that works only in the public interest.

Sadiq Khan is currently consulting on draft Affordable Housing and Viability Supplementary Guidance (consultation ends 28th February 2017) LINK

It is clear from the draft extracts below that more than two experts will be required to give close attention to schemes when developers argue that they will only be 'viable' if less than 50% of housing is 'affordable'.  In truth two people would hardly be adequate for developments taking place just within Brent in Wembley Park, South Kilburn and Alperton. The problem that 'affordable' is not really affordable and Brent  regular backs down in the face of viability assessments has been covered on this blog LINK and reported on Get West London website LINK

VIABILITY ASSESSMENTS

14 The third part of the SPG (Supplementary Planning Guidance) provides detailed guidance on viability assessments, aiming to establish a standardised approach to viability. The SPG clearly sets out what information and assumptions should be included in a viability appraisal. It builds on the London Borough Development Viability Protocol and aims to provide a clear approach that can be consistently applied across London.

15 It sets out the Mayor’s expectations when it comes to the publication of viability information, requiring all information to be made public, including council and third party assessments. Applicants will have the opportunity to argue that limited elements should be kept undisclosed, but the onus is on the applicant to make this case.

16 The SPG is explicit about the Mayor’s preference for using Existing Use Value Plus as the comparable Benchmark Land Value when assessing the viability of a proposal. The premium above Existing Use Value will be based on site by site justification reflecting the circumstances of the site and landowner.

THE MAYOR AND REFERABLE APPLICATIONS

1.16 Given the strategic importance of affordable housing delivery and the significant impact of reduced levels of affordable housing on the delivery of the London Plan, the Mayor will consider directing that he is to be the Local Planning Authority for the purposes of determining an application (often referred to as a ‘call in’) or directing refusal when:

•       he is not satisfied with the viability information submitted by the applicant, the assumptions that underpin the information, or the level of scrutiny given by the LPA; 


•       he considers the viability information submitted may suggest a higher level of affordable housing could reasonably be provided; 


•       the chance of significant contribution to affordable housing could be forgone due to other grounds and the Mayor wants to review the weight the LPA has given to competing planning objectives.