Agenda item

“Engaging Members in Finance Scrutiny” - report of the Finance Scrutiny Working Group.

(Enclosure)

The Chairman introduced this item by praising the working group’s report. It used clear English, was well presented and was exactly what the panel had required.  He expressed his thanks to the group and the Scrutiny Support Officer for the report.

Councillor Moore, as lead member of the group, presented the report and explained that the style had intended to reflect one of the key aims of the group – to make council finance understandable. He thanked his colleagues and those officers who had contributed. The group had scrutinised the budget setting process for the 2006/07 budget, interviewed staff, conducted a member survey and obtained desktop research. 

The panel discussed each recommendation in turn:

·          Recommendation (1): the main issue for members had been time. This recommendation sought to tackle this. The new corporate plan would be appropriate here. The Corporate Head commented that this proposal could result in a five week sterile period. The recommendation was therefore altered. The issue of the Medium Term Financial Strategy (MTFS) also arose: this doesn’t get approved until September; if this were earlier it would provide better planning for the budget. Three year budgeting would also help members in planning their involvement in the budget process.  Member access to service plans or an outline would provide a background. Each DSP, or individual members, could scrutinise relevant plans with the Resources DSP receiving an overall picture.

·          Recommendation (2): this recommendation recognised the fact that service plans should focus on the council’s priorities. Members’ roles should be to direct this with the understanding that the council cannot do everything it wants to do. The MTFS will help set out the relevant constraints.

·          Recommendation (3): members wouldn’t be getting involved in service plan gateway reviews all the time. Three stages is the maximum we could expect members to get involved. Members had previously been deterred by the ad hoc arrangement. It was noted that this stage that the recommendations presented a vision, rather than things that could be implemented straight away.

·          Recommendation (4): This issue came out as a key defect last time. The Corporate Head commented on how this proposal would fit with the overall consultation timetable, meeting timetables, budget milestones etc. Realistically, all feedback needed to be received by the end of January. This related back to the previous comment that the adoption of the MTFS earlier than September would provide greater flexibility.

·          Recommendation (5): information is key. The easier all reports are to understand, the better. Budget book is the key fundamental document and this should set the tone. This needs to be readable, especially for those members with limited understanding of council finance but provide the detail for those members who require it. Most members are more interested in the activity, rather than the cost and it is difficult to relate the two. Highly important that this relationship is made explicit. This recommendation is paramount to equal opportunities etc. We do not expect members to be experts but they should have facilities for them to get the information they need. The Corporate Head commented that this would take time to get right and she urged members to feed back on areas in reports that they did not like.

·          Recommendation (6): the budget monitoring reports item later in the agenda would provide for greater discussion on this.

·          Recommendation (7): Jargon was a real issue and some members were afraid to question meaning. A good exercise would be to give a report to members and ask them to highlight jargon areas. It was noted that the council had improved significantly with its information and with more resources for the financial section, greater strides could be made.

·          Recommendation (8): There was a general commonality in training being offered in Grantham but different members did have different training requirements so it was important to address this. 

Conclusions:

That the report and recommendations of the Finance Scrutiny Working Group be approved, subject to an amendment to recommendation (1) included below, and that the report be forwarded to the Portfolio Holder for Resources & Assets, with the following recommendations. [Recommendation (5) is accepted by the DSP and forwarded to the portfolio holder for noting.]

(1)           A proposed timetable for the development and publication of draft service plans and desired member involvement in those plans should be put forward to all members with the aim of two to four weeks before the start of the process.

(2)           That the role of members in attending service plan gateway reviews is to make recommendations on the future of that service with a focus on the council’s priorities. It is the officer’s role to estimate the financial implications of those recommendations. Members should then consider these financial implications and in light of them, influence the future choices for that service.

(3)           To structure the process better for members, and to provide efficient use of their time, members should be involved at three distinct stages in the service planning process:  at the start of the preparation of service plans, at a mid-point during development of the service plan and towards finalisation of the plans.

(4)           There should be at least ten calendar days between members receiving reports and holding a service plan gateway meeting.

(5)           The Resources DSP is recommended that when scrutinising the council’s budget book and other key documents, it challenges these in terms of its presentation and the ease of which it can be understood by members with little financial knowledge. There should also be an improved level of explanation in the notes to accounts.

(6)           From the evidence gathered, the working group identified a clear need for financial information reports to be presented in various informative and alternative formats that can be easily be understood by anyone with little financial awareness.

(7)           Reports and presentations produced by officers and members should as far as possible avoid the use of financial technical terms and jargon. When this is unavoidable then any such terms should be clearly defined in non-technical and plain English, either in the main body of the report, or in a separate glossary.

(8)           That the Constitution and Accounts committee be recommended that basic understanding of council finance matters be included as an essential training module for all members from May 2007. Optional modules can be provided for higher levels of competency if there is such a demand. Further training in the council’s financial affairs should be made available on a regular basis to all members and at variable times, durations and locations.

The Corporate Head of Finance and Resources be asked to present a report at the meeting of the DSP on 28^th September 2006 in response to these recommendations and a potential timetable for the 2008/09 budget planning process based on a council meeting being held in July or August 2007.