29.06.10
In an attempt to tackle a reported deficit of £2Bn, the BBC has
announced "the first major changes by a publicly-funded organisation" to their pension scheme.
The BBC say their proposals include closing the final-salary scheme to new members and restricting pension payouts to 1% per year. They also include an option whereby existing members of the scheme can continue with the revised final salary plan, or switch to a defined contribution scheme.
The proposals are subject to a consultation period, concluding in the autumn.
Permalink29.06.10
The new Office for Budget Responsibility has
released its pre-budget forcast.
Considering the stern warnings and stoic wartime attitude of David Cameron in the lead-up to the budget, the OBR's report is surprising upbeat, though it's peppered with caveats with regards to unknowns.
The current financial state and immediate projections in the report describe an economy that has already hit the bottom, and now the only way is up.
Interest rates and inflation are predicted to remain similar to now. House prices are expected to rise slightly. Exports are expected to pick up, and overtake imports in the near future. Businesses are thought to have to stopped running down their inventories and will now be re-stocking in anticipation of better times ahead, adding to Gross Domestic Product (GDP).
The fall in the value of the pound versus an improving world economy is predicted to help our country's exports and economic growth.
The report notes that consumer spending has dropped and savings have increased, and it predicts that consumers will continue to be cautious for a while, but maybe spending will increase somewhat, adding to the economy. Business profits are increasing while the UK's share of the global market is not. The report suggests that in the near future, businesses may reduce their profit margins in favour of capturing larger markets and increasing volume of trade. The report mentions how in the 1980's recession, as the economy recovered, wages began to rise, helping to fuel inflation. The report doesn't think that will happen this time around. Unemployment is predicted to fall quite sharply over the coming years. Oil prices are predicted to fall. Government income is predicted to fall slightly next year, then recover and grow.
Read full article (Permalink)
29.06.10
John Hutton, former Secretary of State for Defence under Labour, is to head a commission to examine and make recomendations on public sector pensions. The commission will produce an interim report in the autumn, and a final report before the 2011 budget.
In 2008 the council workers' scheme, the Local Government Pension Scheme, underwent an
overhaul. It changed the scheme from being a 1/80th contribution to a 1/60th. Those earning more than £18,000 also had to increase their level of contribution. The LGPS is also distinguished by being one of the few schemes that maintains its own funds and pays its retired workers from that fund - most other public sector schemes do not maintain their own fund, and instead retired workers are paid from government funds. Of course, regardless of who holds the funds, all workers with a pension make a contribution, though the percentage contributed by both the employer and employee varies across schemes.
In the last budget, George Osborne announced that all public sector pension payout were to be indexed to the Consumer Price Index measure of inflation. The CPI is based on a 'basket of goods' measure, and does not include house prices.
Reports in the media suggest that workers may face a choice between increased contributions (effectively a pay cut, given that all public sector workers, and their employees, are paid from the same source), or reduced payouts.
The list of pensions schemes to be examined by the commission is as follows:
- Principal Civil Service Pension Scheme
- Principal Civil Service Pension Scheme (Northern Ireland)
- Armed Forces Pension Scheme
- NHS Pension Scheme
- NHS Superannuation Scheme (Scotland)
- Health and Personal Social Services Northern ireland Superannuation Scheme
- Teachers' Pension Scheme (England and Wales)
- Scottish Teachers' Superannuation Scheme
- Northern Ireland Teachers Superannuation Scheme
- Local Government Pension Scheme (England and Wales)
- Local Government Pension Scheme (Scotland)
- Northern Ireland Local Government Pension Scheme
- Police Pension Scheme
- Firefighters' Pension Scheme
- United Kingdom Atomic Energy Authority Pension Schemes
- Judicial Pensions Scheme
- Department for International Development - Overseas Superannuation Schemes
- Research Councils' Pension Schemes
Read full article (Permalink)
29.06.10
The Government has announced that Will Hutton has been appointed head of a
review of pay in the public sector.
Will Hutton is an Observer columnist and former editor. He is also an executive vice chair of the The Work Foundation.
The review will look into public sector pay, and will "make recommendations on how to ensure that no public sector manager can earn more than twenty times the lowest paid person in the organisation" - a Conservative manifesto pledge. Despite this, Government appears to have hinted recently that there may be some flexibility in this rule.
The review will produce a report in September, and a final report before the 2011 budget. Its scope includes all aspects of public sector pay, providing it does not encroach on the John Hutton Commission on public sector pensions.
Permalink28.06.10
The Coalition is asking for your views on how best to save money in the public sector on their
Spending Challenge consultation website.
Up until July 8th, the consulation is open to public sector workers. After that, it's open season as anyone is allowed to have their say. The website promises that all ideas will be looked at by people "at the heart of government", and the best ideas will go forward for further action. They add that they will also "monitor blogs, social networks, forums and wikileaks."
According to the website 20,000 suggestions have been received in 4 days.
Permalink22.06.10
Public sector workers who earn more than £21,000 are to face a 2-year pay freeze. Those not subject to the pay freeze will receive a £250 per year rise.
Compared to the figures published in the Conservative manifesto (
covered here), the threshold has been raised £3,000 from £18,000.
VAT is to rise to 20% from the 4th January 2011. There's no change to the list of items that are exempt from VAT (for example, most food).
Tobacco, alcohol and fuel duty remains unchanged for now, though the cost of all of these items will be increased by the VAT rise. George Osborne said Parliament would look into ways of stabilising fuel prices in future, something that had been promised in previous Conservative literature. The Chancellor also spoke of support to councils so that they can deliver the manifesto pledge of a council tax freeze next year.
There had been some talk in the press of the income tax allowance being increased to £10,000, but today the Chancellor announced a £1,000 increase, bringing the amount you can earn before paying tax up to £7,475. George Osborne made reference to the £10,000 figure and said the Coalition would try to "make real steps towards acheiving that..." over the next five years. Employers' threshold for National Insurance is to rise from £110 to £131.
Across Government, the Coalition is looking to reduce departmental spending (except in Health and International Development) by an extra 17% over Labour's plans.
Benefits have taken a mix of cuts and increases, with the narrative being a reduction for the better-off, whilst bolstering support at the lower end.
After speculation that Child Benefit might be re-worked, Government has opted for a 3-year freeze. Increases in benefits (apart from pensions) are now to be linked to the (usually lower) measure of inflation, the Consumer Price Index, rather than the Retail Price Index, saving the government a projected £6Bn over the life of the current parliament. From 2013, a new medical assessment will be brought in for recipients of Disability Living Allowance with an aim of saving £11Bn. The family component of Tax credits are now to be reduced for households earning £40,000 or more, a less savage cut than was previously trailed in the press. Child tax credits are to increase by £150 above inflation next year. State pensions are to be relinked to inflation, or 2.5%, whichever is greater.
Read full article (Permalink)
19.06.10
The looming Emergency Budget on the 22nd seems to have got the think-tanks and lobbying groups busy firing out press releases and reports. Yesterday, "centre-right" thinktank, Policy Exchange, published a 104-page report,
Controlling Public Spending recommending a 4-year pay freeze for public sector workers - though the recommendation is actually a 'hybrid approach', meaning that the total spend is frozen, but there is an expectation that some of the savings would be made through redundancies or not replacing retiring staff.
Policy Exchange, who have previously been described by Chancellor George Osborne as a "wellspring of new ideas...", say their proposal would save £26 billion overall.
The report, which seems to be largely based on ONS data, notes that jobs in the public sector are paid more than their equivalents in the private sector (except at the very top end, where the private sector races ahead). They also note how different the sectors are, and how difficult it is fairly compare them. Public sector workers are said to have more time in the job and more qualifications.
The report goes into some detail, but there is little mention of the effect of Single Status on council worker pay, despite its
impact. Nontheless, the report notes some of its effects - for example, that the lowest paid received above-average increases, though there is no particular acknowledgement of the pay reductions that the middle-paid tended to receive in return, nor much illumination of the 'flattening' effect on the spread of wages in the average-to-low section.
The report makes a valid point that paying the same wage for the same job across the country (apart from London) is essentially unfair, as cost of living varies widely. Sadly it describes this in terms of workers in low cost-of-living areas being paid a 'premium', rather than high cost-of-living workers being underpaid. It describes the process by which public sector pay bargaining operates, and while its descriptions and conclusions may be accurate for some areas of the public sector, the description of council pay being set by national pay bargaining seems over-emphasised, considering the effects of Single Status job evaluation and councils' freedom to apply 'market forces' pay supplements to retain staff. Whether this variation has led to a fair wage range based on local cost-of-living is another matter.
Read full article (Permalink)
18.06.10
If you've never worked in local government, council pay structures are probably quite confusing. Here's a brief guide to how it all works.
At the core of the local government pay structure is the National Joint Council (NJC) 'pay spine', which is the same all across the country except for London, where a percentage increase is applied for the greater cost of living. The pay spine is the component that is subject to national pay deals negotiated between the unions and the NJC/Local Government Association (LGA) - these are the pay negotiations that get talked about in the press. The pay spine looks something like this:
Point 1: £9,201
Point 2: £9,703
Point 3: £10,111
. ..
And so on, extending up to 49 points, with the rise in money gradually increasing as the points are ascended. The points above 49 (about £40,000+) are not 'official' NJC points and are not set or negotiated at a national level. Next, councils create 'pay scales', or 'pay grades'. For example, Scale 1, or Scale 5. Scale 1 might encompass spine points 1-4. Scale 2 might be points 5-8. Next, they assign scales to jobs. For example, a cleaner might be scale 1. A clerical assistant might be scale 1-2 (i.e. their scale includes spine points 1-8). Pay grades that span more than one pay scale are sometimes referred to as 'career grades', and there may be criteria that must be met for the worker to progress from one scale to the next.
Here's an example of a
spinal point and pay scale chart [Excel spreadsheet] for 2010/2011 from the London Voluntary Service Council.
Upon taking up employment, a council worker will usually start at the bottom of the scale for that job. So in this example, both the cleaner and the clerical assistant will start at point 1. Every year, a council worker's pay rises one spine point, and receives the new wage associated with that spine point. This is usually automatic. On top of that, they receive whatever pay increase was negotiated for that year - the percentage increase is applied at the level of the spinal column structure. Once a worker reaches the top of their scale (e.g. point 4 for the cleaner, and point 8 for the clerical assistant), they no longer progress up the spinal points, and from then on the only wage increase they receive is from the nationally-negotiated settlement.
Read full article (Permalink)
14.06.10
Austerity measures
have been announced across Europe.
Here in the UK, local councils are to
receive £1Bn in budget cuts, with large city councils showing the biggest drops in funding - but the cuts are designed so that no council receives more than a 2% reduction, so it's all relative.
The measures are part of the government's plan to reduce the gap between government income and spending by £6Bn. The deficit is currently reported to be about £150Bn, so that £6Bn isn't going to make much impact on the figures by itself, though it may cause pain to public sector workers - as the LGA is keen
to emphasise. They also took the opportunity to stick the boot in on the 'quangos' -
"We need nothing less than a transformation of the way the public sector works to deliver savings through a bonfire of bureaucracy, a radical scaling back of the quango state and giving power to the people who know their areas best."
There's been much talk in the press recently about how government spending has got out of control. The official figures also tend not to include PFI deals and bank bailouts. Yet much of the problem is not so much the increase in government spending, as the decrease in government income. The deficit seems to be mainly due to a sudden drop in income in 2008, around the time the banks collapsed and the economy imploded. Given that the UK's major industry at the time was the financial sector in London, this is hardly surprising.
As the economic outlook became more gloomy, people and business spent less, and the government received less income from taxes. Banks too have become more cautious and are lending less. This so-called 'death spiral' of negative feedback was perhaps most starkly obvious when people started queuing up to withdraw their money from Northern Rock, because they feared the bank would collapse - and their actions probably caused it to. An economic recovery will probably require more spending from consumers and businesses to close the gap between government outgoings and income. In the meantime, falling wages and the weakening of the pound makes the UK more attractive to companies outside the EU wanting to grab a European base to avoid the EU import taxes. Companies from India and China have been showing signs of investment and relocation, much as Japanese and Korean firms have in the past.
Read full article (Permalink)
06.06.10
The raw data from the government's Combined Online Information System (COINS) was released on Friday.
The information can be found
here.
COINS records government expenditure and categorises it by various headings, such as government department, project, account or month. The categories are fiendishly difficult to translate into meaningful, real-life things. If you'd like to know exactly how much the previous government spent on ID cards, for example, you'll be disappointed. According to The Guardian, they've cunningly hidden the figures in a general 'identity and passport' category.
To anyone familiar with local government expenditure, the released data may resemble council budget codes and expenditure records.
The data will likely provide some good information on where taxpayer's money has been spent, but it's probably vague, obfuscated and in some cases perhaps misleading.
For example, money might be spent purchasing assets and services in one category, whilst a different department begins monthly payments to the first department against a different spending category to the same department, and a few months later the entire spend against services is mysteriously refunded, and 2 years later the assets are amortised... (see the
Olympic funding contribution category for an example of this sort of confusion)
It would take serious time and effort to uncover useful expenditure information from amongst the inter-departmental cost-code juggling and accountancy-speak.
Hopefully future expenditure data releases will be more straightforward - all central government expenditure over £25,000 and all local government expenditure over £500 is to be published online from November.
Links
The Guardian's COINS data query tool
The Open Knowledge Foundation
Notes and Research
The newly published database is difficult to work with and requires access to a high performance database system such as Oracle, MySQL, PostgreSQL, or Microsoft SQL Server - there are over three million records in the files which is more than Microsoft Excel can load and is probably impractical for Microsoft Access.
Read full article (Permalink)
01.06.10
According to various newspapers, the government has published a list of civil servants who earn more than the Prime Minister (reported as being £142,500 per year). Here is
the actual list of 172 civil servants who earn more than the Prime Minister, in CSV format.
According to various newspaper reports, the list is comprised only of civil servants who agreed to appear on the list, and there were 11 people who refused. It's pretty clear, though, that this list is very far from complete.
There's not a single council worker on the list, and yet there must be a few that qualify - Kim Ryley, the Chief Exec of Hull City Council, was reported to be
earning in excess of £200,000 back in July 2009. That would make him roughly the 7th highest paid civil servant on the list if he were added, placing him ahead of of the likes of Sir David Normington (Permanant Secretary for the Home Office) and Sir Nigel Sheinwald (Ambassador to Washington).
It seems unlikely that Hull is the only council paying out hefty sums for their top brass - and this
Guardian article from January 2010 mentions that both Cornwall County Council and Northamptonshire County Council pay their Chief Executives similar wages. The same article quotes a Northamtonshire County Council spokesperson as saying "Our chief executive... earns a little bit more than the prime minister, but, like the BBC, you do have to attract the talent."
The Daily Mail points out that the 172 named officials together earn over £29M per year.
If these 172 officials were all sacked and their wages redistributed to other public sector workers, those lucky workers would all receive a rise of about £5 per year.
Read full article (Permalink)
18.04.10
Public sector workers to be allowed to form autonomous co-operatives.
On Saturday the Tories
set out their manifesto plans for the public sector in a supplemental
manifesto document [PDF download] aimed at the public sector.
The document's theme is very much focused on the idea of setting public sector workers free from red tape and targets. There is mention of protecting workers against litigation, encouraging flexible working and performance related pay - "for example, freeing schools to pay teachers more for high achievement, and more payment according to outcomes in hospitals and Sure Start centres..."
Exactly how the level of performance or 'outcomes' will be measured is not clear, and raises the question of whether the Tories are seeking to replace Labour's targets with a new set of targets with money attached. Given the recent stories of organisations massaging statistics or creatively categorising things, there's an obvious danger here. As with much of their 'Big Society' manifesto, the Conservatives' answer to this problem appears to revolve around public involvement - "The public will be the the experts on judging performance, the need for all the centralised targets will end."
Fair pay gets a mention, with public bodies required to pay their highest paid workers no more than 20 times more than their lowest paid. A wage freeze is to be brought in for workers earning more than £18,000, and public sector pensions capped at £50,000 per year. In the main manifesto document, the Conservatives state that any public servant earning more than the Prime Minister will have to have his or her salary signed off by the Treasury. The Prime Minister's salary is currently £132,923, plus an MP's salary of £64,766. [
Source]
The most dramatic measure in the manifesto is a pledge to apparently
allow public sector workers to escape from their local authority's control and form a public sector co-operative organisation and "bid to run services".
Read full article (Permalink)
14.03.10
In July 2009, there were 19 streetlighting Private Finance Initiative projects up and running, and many others at various stages of completion, including:
Nottingham City Council
Suffolk County Council
Norfolk County Council
South Tyneside Council
London Borough of Lambeth
Oldham and Rochdale Metropolitan Borough Councils
Durham County Council and Stockton Borough Council
Leeds City Council
The following councils were
approved for PFI credits in February 2010:
Durham & Stockton - £126M
Essex - £164M
Gloucestershire - £80M
Hertfordshire - £140M
Kirklees - £66M
Warrington - £46M
These authorities now must submit outline business cases before entering the procurement stage.
In most cases, councils have opted to use a white-light lightbulb called the CosmoPolis, made by Philips. Current streetlighting tends to use a
high pressure sodium bulb (orange glow) or a
mercury vapour bulb (white glow). Mercury vapour lights are to be banned/phased out by EU rules by 2015.
On the 9th February Harrow Borough Council announced that it was dumping its PFI streetlighting scheme - "While the Department for Transport recognised, and still does recognise, the merit of our proposal, it was irresponsible of us to commit to £1m a year over 25 years - a key condition of the PFI contract - given the unprecedented financial pressures on us caused by the credit crunch." - Cllr Susan Hall.
According to the
Harrow Times, the PFI scheme was applied for under the previous Labour administration, then later approved during the Tories' reign, who cancelled it following questions raised by the Harrow Times. Durham's PFI has recently been
attacked in the local press.
The latest innovation in streetlighting is
white-LED lighting, often found in newer handheld torchlights. A number of foreign cities have already made the switch to LED streetlights. The Philips CosmoPolis light has a lifetime of 30,000-60,000 hours, according to
Philips' own technical specifications. In contrast, LED (Light Emitting Diode) technology is said to have a lifetime of 50,000-100,000 hours and is considerably more energy efficient. At the present time, the initial outlay is more expensive, but this price seems likely to fall over time, as high-power white LED lighting is still a relatively new innovation.
Notes and Research
Promotional literature from Urbis, a popular commerical partner for PFI lighting schemes
South Tyneside/Philips CosmoPolis case study from Voltimum
Background to streetlighting PFIs
LED Streetlighting technical data
July 2009 news on third round of PFI schemes for streetlighting.
New streetlighting schemes for 2010 Permalink09.03.10
The NEP
reports that the Labour-run Council has passed their cost-cutting budget amidst political opposition and
protests. At one stage, it was reported that the
trams were brought to a halt in the city centre by a sit-down protest by deaf campaigners.
Like the Tory-run County Council, the City is proposing budget and service cutbacks whilst increasing spending in other areas. Both councils are increasing charges to elderly service users.
Both the City's Conservatives and Liberal Democrats have criticised the budget and put forward alternatives. The Tories suggested cutting back on money spend on communications, including the Council's Arrow magazine. Council magazines have been widely criticised across the country following a large scale FOI request inquiring into their costs and in some cases councils have already scaled back or dropped their publications in response.
The Lib Dems also pointed to potential savings in publicity: Cllr Gary Long, leader of the Lib Dems is quoted in the NEP article as saying, "What makes a city proud is the way it looks after its people, not huge stickers on the side of lorries telling people that they are proud."
The City Council has faced
criticism in the past for spending money on controversial banners proclaiming the council's acheivements - in one case the district auditor described these banners as "borderline legal".
Ironically, the City Conservatives also suggested reducing the amount of money spent on temporary staff - a measure the County Conservatives rejected when it was put to them by the unions.
Footage of the protest can be seen here.Permalink08.03.10
The planned 2-day strike by the Public and Commercial Services union went ahead today and, according to the PCS, brought 200,000 civil servants out on strike.
The strike has received coverage from local and national press across the country. The Times
covers the story here for example. A sample of regional news:
Nottingham workers' story is here, you can read the
view from the North East here,
here's Shropshire's perspective,
London's report here,
etc.
HMRC say that one third of their staff walked out, and various arms of government have been hit, including border controls and the Department for Work and Pensions.
According to the Times article, the Cabinet Office claims that only 15% of affected civil servants took action.
The dispute centres around cutbacks in the redundancy and early retirement scheme that is designed to save £500M.
While public sector workers' terms, conditions and retirement payments appear to be
under attack across the country, coincidentally, public sector retirement schemes have been receiving quite a lot of negative publicity in the media recently.
Permalink13.02.10
The BBC
reports that Job Centre, HM Revenue & Customs and immigration workers are being balloted on strike action.
If the
Public and Commercial Services Union gets a result in favour of action, then workers will stage a 2-day strike in March, and could be followed by further action in April. The PCS is
pressing for a 'yes' vote in favour of action.
The dispute centres around proposed cutbacks in the Civil Service Compensation Scheme (CSCS), the redundancy and early retirement payment scheme for the civil service. The PCS is also threatening legal action against the cuts, which are designed to save £500M.
Permalink13.02.10
Thanks to an
FOI request submitted to Ashfield District Council, we now know the answer: It's about £70,000.
But this is perhaps the least interesting part of the information. Included in the FOI data is an audit report of the (massively over-budget) Ashfield Show.
The report suggests that timescales and pressures became so intense that mistakes were made.
Ashfield hoped for increased sponsorship revenue as a result of booking the Sugababes, but don't seem to have got it. A deal for £15,000 was struck with Tesco, but there doesn't seem to be anything written down. The audit report recommends that these things be put in writing in future.
The audit report also suggests, as a high priority, that in future the council cabinet might like to be a bit clearer in its orders and follow the constitution.
It also points out that the contract signed with the Sugababes' agency, Aries Entertainment, was apparently signed on the 31st April. Kudos to the auditor for noticing that there are only 30 days in April.
The council also hired some 2-way radios that apparently were never returned, and 25 metres of electrical cable that went missing with "no explanation", incurring costs of over £1,000.
Permalink09.02.10
The Evening Post
reported yesterday that the County Council could become a "super-centre" for councils in the region. This appears to be on the back of the council's new "One Council, one business, one plan" improvement programme, currently still in the planning stages.
The article suggests that following the fall-through of a plan to merge functions with Leicestershire County Council, they are now turning their sights on the District Councils, with an aim to creating a unitary authority, or a unitary-like authority, and merging IT, HR and Finance departments.
Unitary councils are distinguished by having no County council above them in the hierarchy, and no District or Parish councils below them in the hierarchy, meaning that political power is more highly concentrated, direct and easier to wield. Nottingham City Council is an example of a unitary authority. Their unitary status, combined with the fact that they are Labour-controlled under a Labour government, probably contributes to them being able to implement more controversial and radical schemes such as the Workplace Parking Levy, or the tram.
The Nottingham Evening Post report must have made HR, IT and Finance staff at Nottinghamshire's 7 district councils pretty nervous about their future in the face of mergers designed to save money.
But the reality of the situation is not so grim, at least for now. NCC has communicated to its staff that this is mainly about updating its own IT systems, it has no plans for unitary status, and that it "may" offer back office service to district councils, if they are interested. It is said that any changes would take about 3 years.
NCC has updated its back office IT functions a number of times in recent years.
The Conservative party has stated in its
plans for local government that it strongly opposes the creation of any new unitary authorities.
Read full article (Permalink)
07.02.10
Nottingham City Council recently approved the Workplace Parking Levy and the local BBC are
calling for your views via their website.
The council says it hopes to raise £14M per year from the scheme, and they are currently the only council in the country to use it, though
others have considered it, and have so far backed down in the face of unpopularity.
Meanwhile, major Nottingham pharmaceutical manufacturer, Boots, has announced that they are
outraged by the WPL. They have since
promised not to pass on the charge to their staff and announced
a plan to avoid having to pay it altogether.
The plan goes like this. Boots' site is partly on City Council land, and party on Broxtowe Borough Council land. 1,500 of their parking spaces are in Broxtowe, while the other 3,000 are in the City. In the first year, Boots will have to pay around £750,000 for those 3,000 spaces. Boots has spare land in the Broxtowe area to simply move all of its parking spaces into the non-chargeable Broxtowe area, thus saving at least a three quarters of a million pounds per year.
If Boots were to go through with this, the City's WPL budget would obviously reduce by £750,000 per year - not ideal perhaps, but the City say they have made allowances for the fact that "employers may potentially reduce the number of liable parking places they provide."
Boots does not currently have planning permission for additional parking spaces from Broxtowe Borough Council.
The spotlight now falls on Broxtowe. Boots can expect around three quarters of a million pounds in savings each year if Broxtowe grant a request for planning permission.
The WPL is meant to fund Line 2 of the tram, which will serve the Broxtowe area, and also fund improvements to the City Council-owned NCT 'Link' bus services, who happen to provide transport for Boots workers.
Read full article (Permalink)
04.02.10
The Leicester Mercury has provided an interesting case study of two different councils, one run by Labour, the other by the Conservatives.
The City Council is run by Labour. About 70% of its income comes from government grants. They are planning budget cuts of 7%. They plan to cut £19M from a budget of £280M, and cut 270 posts from their workforce of 7,000.
The County Council is run by the Conservatives. They get about 70% of their income from council tax. They're planning to cut the budget by 20%. They plan to cut £66M from their £325M budget and cut 650 posts from their workforce of 6,000.
Given the difference in funding sources, obviously the Tory-run council would be harder hit by a council tax freeze or reduction (it would have to cut costs by about twice as much as the Labour-run City Council to deliver the same freeze or reduction, all other things being equal). The government recently
called upon all councils to deliver a low council tax rise in a press release - "councils are getting 39 per cent more funding from Whitehall than they did in 1997 and there is no excuse for huge tax rises."
The article discusses a future expectation of a 2% cut in government grants, and calls upon Professor Lawrence Pratchett, head of the Public Policy Department at De Montford University, to inform readers that differences between the councils could be a party political issue. Well worth a read.
Permalink01.02.10
Nottinghamshire County Council has issued the following new Terms and Conditions of Employment proposals:
Click to view document (PDF)
Talks with the unions are ongoing. One alternative put forward in negotiations was equalise all holiday entitlements by lowering the entitlement for the better paid (Band A upwards). Apparently this would save £3.2M, thus removing the need for any other changes to Terms and Conditions. NCC rejected the proposal.
Original NCC report
The council's Personnel Committee papers for the 29th January includes a
report from the Service Director of Human Resources on levels of sickness at NCC and proposals to reduce them.
NCC has reduced its average number of days lost per employee to 9.56, but they're aiming for 8.75 by March 2010. The biggest cause of sick days is medical operations and post operative recovery. The second most common cause is stress.
NCC is setting up a steering group to examine the issue of stress and "prevent and identify potential stress at an earlier stage".
There are also various proposals. Trigger levels for absence management action are to be set to 3 instances of absence in any 6 months, or 10 working days per 12 months, or a 2 working-week equivalent for part-timers. The unions are said to be opposed to this. Appeals against dismissals brought about by absence management are to be heard by senior managers, rather than elected members. The unions are said to be opposed to this.
Statistical breakdowns on absences are to be circulated to Corporate and Service Directors on a quarterly basis "in order to address the common themes and issues identified in addition to more localised issues."
Read full article (Permalink)
31.01.10
Communities Secretary John Denham is quoted in
The People as saying "...we expect this year's increases to be the lowest for 16 years". The article adds, "Labour says councils are getting 39 per cent more funding from Whitehall than they did in 1997 and there is no excuse for huge tax rises."
Mr Denham, Secretary of State for the Communities Department (the branch of Government that deals with Local Authority funding) then goes on to attack Conservative
plans to increase funding from Central Government to fund council tax freezes.
The story is probably a response to
this press release from the Government. In the notes to editors section, it helpfully points out that the Government is working towards freeing councils from 'strings-attached' funding and has moved £6Bn into non-ring-fenced funds (i.e. the Formula Grant).
According to
statistics published by the same department, the government moved £24Bn from the 'no-strings attached' formula grant in 2006, to help fund more targeted grants, mainly the Dedicated Schools Grant. Since then, at least two other targetted grants have been set up, including the Area Based Grant and Sure Start, Early Years and Childcare Grant, both set up in 2008. Total funding for these two grants stood at around £4Bn in 2009. In 2008, there were more than 60 targetted grants. About two-thirds of all government money to councils was in the form of these ring-fenced funds.
Council formula grant is recalculated every year according to a complex formula which may change each time.
Here's the data on all councils' formula funding for 08/09
Click for a larger version
This graph shows the various sources of government funding outlined in the Communities Dept's statistics over the last 5 years - plus council tax. The formula grant includes money collected from business premises in business rates - this money is collected locally, and then redistributed nationally via the grant.
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30.01.10
Friday's
Nottingham Evening Post reports that Nottingham City Council is bracing itself for a reduction in government grant from 2011 onwards. The council is apparently looking at reductions of 5% or 10%, and hoping for 5%.
Saturday's
Northern Echo reports that North Yorkshire County Council is bracing itself for "a perfect financial storm", including an expected 5% reduction in government grant from 2011 onwards.
N Yorks Council is looking to deliver a 2.94% council tax rise, the lowest in 16 years. It also cites the usual increased financial pressures in adult and child care, and also adds road repairs to the mix - recent cold conditions have damaged roads nationwide.
Cold weather road damage is caused by a freeze/thaw erosion process, where water collects in existing cracks and holes and then freezes, expanding and making the hole bigger.
Permalink29.01.10
The Northern Echo reports that Nottinghamshire Conservative MP and Shadow Secretary for Business Ken Clarke has ordered a review of Conservative policy on Regional Development Agencies (RDAs).
The article states that this has come about following concerns raised by the CBI and British Chambers of Commerce with regard to "scrapping" the RDAs.
However, actual
published Conservative policy suggests they weren't going to entirely scrap them anyway, they were mainly going to devolve their planning, regional spacial strategy and housing powers to councils. Given that the RSS sets priorities for regional investment and transport, perhaps this is the bone of contention.
The CBI represents 'big business' in the UK, with 80% of FTSE 100 companies signed up as members. The Chambers of Commerce represents business of all sizes, and is comprised of various regional branches. Large national and international firms are usually well represented at board level.
RDAs serve as a tier of local government above local councils, and currently have wide-ranging powers over planning and funnelling government grants to regions. Local businesses, often Chamber of Commerce members, are usually represented on the LGA boards, along with local authorities, trade unions and the voluntary sector. Unlike at LA level, representatives are not directly elected by the public.
Various newspaper reports have suggested that Tory plans to move powers away from RDAs and towards local authorities is motivated by the fact that the Conservative Party is currently better represented at LA level than at RDA level. Current Conservative plans for LA's include greater accountability and transparency, while their plans for accountability and transparency at RDA level are currently less clear.
Permalink21.01.10
Budget cuts, pay freezes and rising inflation may make 2010 a difficult year to be a council worker.
Councils
around the country are shedding workers and making cutbacks. The government has announced mandatory efficiency savings and a 1% pay rise next financial year for public sector workers, while the LGA seems to be aiming for 0%, according to recent communications from them. There's not much sign of hope from the political opposition, either, with the Conservatives
planning a 0% wage increase for one year if elected.
Set against a backdrop of
rising inflation, council pay looks likely to decrease in real terms. Depending on the rate of inflation and how long pay is held down for, those who saw increases under job evaluation may see those gains wiped out in real terms - and the workers who sacrificed their wages to pay for the increases will suffer yet again.
Many workers are now approaching the end of their 'pay protection' period, meaning that they will now feel the impact of the wage cuts brought about by single status.
In the short term, this seems likely to further cool the economy, as public sector workers tighten their belts. The Midlands and North-East stand to be particularly badly hit, as a recent
Centre for Cities report shows that these areas have some of the highest proportions of employees working within the public sector.
Permalink21.01.10
Hot on the heels of the LGA referring to the current economic climate in councils as being "rather like the time when you've got to scrabble down the back of the sofa for loose change...", Unison and NCC have
have had a rummage around and discovered £2M in the shape of increased council tax revenue from new houses, thanks to the diligent efforts of Ravi Subramanian of Unison.
Apparently the latest figures for the new tax base weren't available when the budget was compiled. The budget was released a month earlier than usual due to scale of the cutbacks and to
"make sure everyone gets the opportunity to have their say about the Council's future financial priorities."
The
new budget has found an extra £4M and means that many threatened cuts to local services have now been softened, and Council communications suggest that some redundancies may be avoided.
Here you can find further details of the revised budget.
Changes to Terms and Conditions have also been softened.
NCC
states that of the £85M savings required over 3 years, £53M is to be invested "to meet increased demand for Council services."
2 days after the budget revisions were announced, NCC's budget proposals
consultation closes tomorrow, on Friday.
Permalink16.01.10
Belper News reports that hundreds of DCC workers have missed the Council's deadline to sign up to a new pay deal and have received dismissal notices as a result.
The new pay deal will result in around 3,500 staff taking a pay cut. Job types facing a cut include care workers, child centre workers, support workers and library assistants. Job types that will see a wage increase include catering, social work and learning support assistants.
Workers have until the end of March to sign up or face dismissal. The tactic will be familiar to many councils who've already been through this, including Birmingham City and Notts County.
The Chief Exec of DerbysCC is quoted as saying, "This is the best deal we could afford. We have put an extra £10.1 million into the annual pay budget to help pay for single status and a further £6 million to protect all employees from a cut in their basic pay during the next three years."
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