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Hampshire Fire and Rescue Authority

Hampshire Fire and Rescue Authority. Budget Consultation 9 January 2012 Rob Carr, Deputy Treasurer. Facts and Figures – 2011/12 budget Proposals for 2012/13 Budget Looking ahead. CONTENTS. Please do ask questions as we go through !. Budget Context 2011/12.

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Hampshire Fire and Rescue Authority

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  1. Hampshire Fire and Rescue Authority Budget Consultation 9 January 2012 Rob Carr, Deputy Treasurer

  2. Facts and Figures – 2011/12 budgetProposals for 2012/13 BudgetLooking ahead CONTENTS Please do ask questions as we go through !

  3. Budget Context 2011/12

  4. Council tax: who gets what?Average bill (Band D) £1,425 [2011/12] Hampshire County Council £1,038 (73%) District & Parish Councils (average) £180 (13%) Hampshire Police Authority £146 (10%) Hampshire Fire and Rescue Authority £61 (4%) [Similar proportions apply in Portsmouth and Southampton]

  5. Council tax: how do we compare?Band ‘D’ council tax 2005/06 to 2011/12 Average Hampshire

  6. Gross expenditure: £80m(2011/12) Employees £62m (77.5%) Supplies & Services £8m (10%) Premises £4m (5%) Capital charges £4m (5%) Transport £2m (2.5%)

  7. Net expenditure: £69m(2011/12) Responding to emergencies £62m (90%) Preventing incidents £2m (3%) Protecting life & property £5m (7%)

  8. How the £69m is funded (2011/12) Revenue support grant £7m (10%) Council tax £40m (58%) National non-domestic rates £22m (32%)

  9. 2012/13 Budget

  10. 2012/13 Budget Assumptions • Slight increase in Government Grant • No pay award (in line with Government’s 2 year pay freeze) • No increase in council tax, but extra Government grant for tax freeze (£1.2m) • Efficiency savings programme will contribute £1.3m

  11. 2012/13 Efficiency Savings

  12. 2012/13 Budget Summary £’000 2011/12 Budget 68,674 Add: Inflation 449 Less: ‘One off’ expenditure from previous year -1,970 Other adjustments -92 Efficiency Savings -1,321 Council Tax Freeze Grant -1,175 Council Tax -39,125 Government Grant -30,090 =Budget Surplus -4,650 Recommended that this is added to the Capital Payment Reserve.

  13. Budget Strategy and Future Forecasts

  14. Budget strategy: council tax • We won’t increase council tax 2012/13 ... • … but we’ll take the Government reward grant equivalent to a 3% increase • From 2013/14 the Authority is considering increases of 0% to 2.5% • We are assuming cuts in Government Grant of 12.5% in both 2013/14 and 2014/15 (over £7m) • The assumptions we make determine the scale of the cuts needed – the funding gap

  15. Budget strategy: funding gap

  16. Budget strategy: funding gap • We cannot avoid reducing staff - but we can do this in a planned way • Need to plan for a worse-case scenario • Current target is to reduce expenditure on staffing by up to 15% • efficient and flexible crewing comprehensive staff review

  17. Budget strategy: funding gap • Also looking at: • scope for more efficient working (including increased partnership working) • income generation • improvements in our retained duty system • Our corporate objectives focus on delivering our services more economically

  18. Assessing our financial risks • Uncertainty about levels of grant in 2013/14 & 2014/15 ... …is a reduction of 12.5% in each year realistic or optimistic? • Pay inflation: we’ve assumed 0% for 2012/13 … … is just 1% for the following two years enough? Is a price-v-pay spiral looming?

  19. Assessing our financial risks • Capital funding: we don’t yet know the amount - or the rules from 2013/14 …need to mitigate against possible impact on vehicle replacement programme and building maintenance • Scrapping of the Regional Control Centre project … … pressure to replace our obsolete system

  20. Assessing our financial risks • General inflation: energy and fuel prices expected to increase significantly ... … another reason to ‘invest to save’ in building maintenance • Operational activity … …extremes of weather, flu pandemics • Uninsured losses, pension costs … and the need to fund upfront costs of future staff reductions

  21. Budget strategy: council tax Good track-record of limiting increases at or below the increases in state pensions 2009/10: pensions … 5.0% council tax … 4.1% 2010/11: pensions … 2.5% council tax … 1.8% 2011/12: pensions … 3.1% council tax … 0.0% 2012/13: pensions … 5.2% council tax … 0.0% Average: pensions … 4.0%council tax … 1.5%

  22. 2013/14 onwards • Formula grant for 2013/14 & 2014/15 • General inflation for the next four years • The extent and timing of cuts to be made • Possibly pay inflation 2013/14 onwards • Government already warning that next Comprehensive Spending Review (2015/16 onwards) will be as tough as the last

  23. Over to you… • Do you have any questions or comments? • Are our risk assumptions reasonable? • Happy about building up reserves? • Views about future council tax increases? • Are there any ‘no-go’ areas?

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