Agendas, reports and minutes

Minutes of Meeting of the Highland Council held in the Council Chamber, Council Headquarters, Glenurquhart Road, Inverness on Thursday, 15 February 2018 at 10.30am.

1. Calling of the Roll and Apologies for Absence
A’ Gairm a’ Chlàir agus Leisgeulan

Present:    
Mr G Adam, Mr B Allan, Mr R Balfour, Mrs J Barclay, Mr A Baxter, Mr B Boyd, Mr R Bremner, Mr I Brown, Mr J Bruce, Mrs C Caddick, Mrs I Campbell, Miss J Campbell, Mrs G Campbell-Sinclair, Mrs H Carmichael, Mr A Christie, Dr I Cockburn, Mrs M Cockburn, Mr G Cruickshank, Ms K Currie, Mrs M Davidson, Mr J Finlayson, Mr M Finlayson, Mr C Fraser, Mr L Fraser, Mr R Gale, Mr J Gordon , Mr K Gowans, Mr A Graham, Mr J Gray, Mr T Heggie, Mr A Henderson, Mr A Jarvie, Ms E Knox, Mr R Laird, Mr B Lobban, Mr D Louden, Mrs L MacDonald, Mr R MacDonald, Mrs D MacKay, Mr D Mackay, Mr W MacKay, Mr G MacKenzie, Mrs I MacKenzie, Mr S Mackie, Mr A Mackinnon, Mrs A MacLean, Mr C MacLeod, Mr D MacLeod, Mr D Macpherson, Mr R MacWilliam, Mrs B McAllister, Mr J McGillivray, Mr N McLean, Mr H Morrison, Ms L Munro , Mrs P Munro, Mr M Reiss, Mr A Rhind, Mrs F Robertson, Mrs T Robertson, Mr K Rosie, Mr G Ross, Mr P Saggers, Mr A Sinclair, Ms N Sinclair, Mr C Smith, Mr B Thompson, Mrs C Wilson

In Attendance:    
Chief Executive
Depute Chief Executive/Director of
Corporate Resources
Director of Development & Infrastructure    
Director of Care and Learning
Director of Community Services   

Mr B Lobban in the Chair

Apologies for absence were intimated on behalf of Ms P Hadley, Mrs M Smith, Mrs M Paterson, Ms K Stephen and Mr I Ramon. 

2. Declarations of Interest
Foillseachaidhean Com-pàirt

The Council NOTED the declarations of interest as set out in Appendix 1 to these Minutes. 

3. Membership of the Council
Ballrachd na Comhairle

Prior to the commencement of the formal business, warm tributes were paid to the late Councillor Billy MacLachlan who had been an extremely hard working and dedicated Member of the Council and especially in his Caol and Mallaig Ward where he would be greatly missed by all who had known him. 

In this regard, the condolences of the Council were conveyed to his family and friends.    

It was also noted that a By-Election for Ward 11 (Caol and Mallaig) had been arranged and would be held on Thursday, 5 April 2018. 

4. Revenue Budget 2018/19
Buidseat Teachd-a-steach 2018/19

There had been circulated Report No. HC/1/18 dated 7 February 2018 by the Chief Executive/Director of Corporate Resources which outlined the budget gap of £15.146m facing the Council in 2018/19 and introduced the Administration Group’s proposals for meeting this gap and delivering a balanced budget. 

The report also made proposals for Council Tax rates in 2018-19.

In presenting the report, the Depute Chief Executive/Director of Corporate Resources confirmed that the Council faced a continuing squeeze on its finances and over the past seven years £132m of budget savings had been needed in order to balance the budget. For the financial year 2018/19, a budget gap of £15.146m had been identified and this had required to be met by making savings or increasing income. As such, the work done to close this gap had focused activity on five key areas, namely prioritisation, efficiency, income, commercialism and redesign (with the area of increased income being given a high priority).

As part of the Scottish Government Revenue Grant, the Council had received £443.833m and once new expenditure commitments (required as part of the settlement) had been excluded, this broadly equated to a flat cash settlement. Whilst this settlement figure had been welcomed as a significant improvement on the previously assumed position, it had to be noted that a flat cash settlement at a time of significant cost increases (most notably round pay) did still leave the Council with a requirement to make a number of savings. Also, the timing of the Scottish Government’s budget announcements had not given ample time for planning for the new financial year and one year only settlements did not assist with medium term financial planning. As such, a request would be made to the Scottish Government for greater clarity over future financial settlements in future in order for a more balanced approach to budgeting to be taken.

In relation to Loans Charges and Capital Expenditure, it was confirmed that, in the financial year 2017/18, the loans charges budget was £56.7m which represented 10% of the Council’s overall revenue budget. Once financing costs included in other budget lines were added, the Council’s overall borrowing costs as a proportion of net revenue budget increased to over 13% which was the fifth highest in Scotland. As such, and in his capacity as the Council’s Section 95 Officer, the Depute Chief Executive/Director of Corporate Resources advised Members not to increase the budget available for loans charges in order to ensure continued compliance with CIPFA’s Prudential Code for Capital Finance. A revised Capital Programme would be brought to the next Council meeting in March and it was suggested that Members should agree to the principle of this Programme being affordable within the current loans charges budget.

Information was also provided at this point on the specific proposals for meeting the budget gap of £15.146m as follows – 

Already Agreed Savings - £1.260m
3% Council Tax Increase - £3.448m
New Income Generation Proposals - £3.059m
Service Savings - £5.129m
Redesign Savings - £2.250m

In regard to the staffing impact of the budget proposals, it was confirmed that the level of reductions was considerably lower than had been anticipated. However, due to the uncertainty around the funding settlement in early January, Council Officers had implemented their obligation to initiate statutory collective compulsory redundancy consultation with Trade Unions and the stress of this situation was acknowledged. In this respect, representations were to be made to the Scottish Government that, whilst the last minute increases to funding levels had been welcomed, the current national budget process had had a hugely negative effect on the wellbeing of Highland Council employees.

Also, and in relation to the focus which had been given to proposals which did not have staffing implications, it was suggested that the Council could no longer continue to protect frontline services in future at the expense of professional support services which had already been significantly reduced in previous years. As such, it was highlighted that continued reduction of these professional support services would represent a high risk in terms of non-compliance and lack of governance over future projects.    

A key message from Audit Scotland had been the need for Councils to have in place ‘robust medium term financial strategies and effective leadership to deliver them’ and as such it was intended that work should commence immediately to develop a medium term financial strategy for Highland Council which could be in place for the period 2019/20 to 2021/22. This strategy would align with broader Council strategies and plans (including the Corporate Plan, the Workforce Strategy and Asset Management Plans), and would consider key financial items, including borrowing and reserves.     

Specifically in relation to Reserves and Balances, it was advised that, based on the Quarter 2 monitoring position, a year-end balance of £8.674m was forecast for the un-earmarked General Fund reserve. This represented just over 1.5% of the annual Revenue Budget and was expected to reduce further once the Quarter 3 monitoring was finalised. It was considered that such a low level of balances would leave the Council exposed to any significant risk events in 2018/19, give little ability to support future developments and offer little opportunity to mitigate any 2018/19 budget savings not delivered. As such, it was stressed that replenishing reserves had to be a priority (rather than an option) in the following year.   

Finally, and whilst no decision had yet been reached on pay awards for Council employees, it had been considered prudent to budget for a pay award in line with that proposed by the Scottish Government, namely a 3% rise for those earning up to £36,500 with a 2% rise for those earning in excess of that amount, capped at a maximum award of £1,600. In addition, the Council required to budget for the full year effect of the 2017/18 2% pay award for teachers. The total anticipated cost of these pay awards was £9.360m and, whilst the constraints which had been applied to staff pay in recent years were recognised, the requirement to fund a pay award of this magnitude did place considerable strain on the Council resources.                             

The Budget Leader expressed thanks to the Chief Executive, the Depute Chief Executive/Director of Corporate Resources and his staff, the other Directors and the budget team for the considerable work undertaken and the support provided in regard to the budget process. 

It was felt that the proposals from the Administration represented a positive response to the current financial circumstances and left the Council in a much better position than had been anticipated. However, whilst the additional funding which had been provided by the Scottish Government was welcomed, this had been a very unsettling period for all concerned and the Council would continue to lobby for multi-year budget settlements in future (as opposed to the current one year settlement) and for earlier notification of grant settlement figures. 

Representations would also be made to both the UK and Scottish Governments for additional capital funding and bringing reserves and balances up to a more satisfactory level remained a priority, along with the exploration of commercial and other income generating opportunities.

The priority given to Roads, Winter Maintenance, Care & Learning and frontline staff was highlighted and it was again reiterated that staff were the Council’s greatest asset. Avoidance of compulsory redundancies was particularly welcomed and it was confirmed that vacancies would continue to be monitored as and when they arose and redeployment opportunities offered where and when necessary. Along with the implementation of the Workforce Strategy Plan, a zero based budgeting exercise would now be undertaken which was expected to provide further efficiencies over time. 

At this point, the Budget Leader confirmed that he was moving the recommendations within the report as a fair and balanced budget for all and this was seconded by the Depute Leader of the Council.       

The Depute Leader of the SNP Group expressed disappointment at the theme of recent press statements by the Administration and also the narrative within the budget report which appeared to place blame on the Scottish Government (despite the additional funding which had been received which equated to a flat cash settlement). 

Also, there appeared to have been blame directed towards Council Officers and specifically the Director of Care & Learning in regard to the presentation of initial savings proposals (despite these having come forward from a political level as opposed to an Officer level) and the SNP Group (who had been accused of scaremongering when in fact they had been exercising their rightful scrutiny role as the largest Opposition Group on the Council).

Whilst welcoming the avoidance of compulsory redundancies and the proposals for implementation of a zero based budgeting exercise, it was however contended that responsibility for the overall budget process and the current budget gap lay with the Administration (and not the Scottish Government) and leadership was required in terms of dealing with this situation now and in future years.

It was also regrettable that, despite previous confirmation that it would be submitted to this meeting for consideration, the Capital Budget had now been delayed until the March meeting of the Council which continued the uncertainty for many people and businesses across the Highlands.             

The Leader of the Scottish Conservative Group conveyed thanks to all those involved in the fair and balanced budget which was being presented and considered that his own Group had been a positive influence in what was their first budget, not least in the protection of frontline services which had always been a high priority. Particular thanks were conveyed to Officers for the time and patience given to Group Members to enable them to feed into proposals to save the Council money and pursue more commercial endeavours. Specifically, proposals in regard to mental health provision and the new MOT Test Centre had been provided by the Group, along with proposals in respect of foster carers, looked after children, burial charges and refuse collection authorisations.

Despite the Scottish Government focus on community empowerment and localism, it appeared that Local Government was still being asked to do more for less and in this regard it was suggested that development of further areas of taxation (as an alternative to the current Council Tax system) had to be developed at a national level, along with the provision of multi-year budget settlements for Councils in future.    

The Leader of the Liberal Democrat Group made reference to the current budget setting arrangements and in particular the notification of the grant settlement figure from the Scottish Government which was invariably not received until late in the year and subject to further change thereafter (as had been the case this year). As such, the budget process within Highland Council had once again been a direct consequence of what happened elsewhere and this was not beneficial for anyone, not least because the Council had had to plan for every eventuality which had caused concern for many in the interim. Also, and as had been stated by the Depute Chief Executive/Director of Corporate Resources, the Council would have needed a 2.7% increase in the grant figure just to ‘stand still’ and this had not happened. 

In addition to the constraints which the previous Council Tax freeze had placed on Councils, a current one year settlement figure did not allow for medium or long term planning which again was to the detriment of Council Services. As such, there appeared to be little evidence that Local Government was a priority for the Scottish Government and whilst the budget proposals which were being presented were considered to be the best options available to the Council, there was concern that once again the most vulnerable members of society would be most disadvantaged. It was therefore imperative that all Members of the Council pursued fair and equitable funding for the provision of services in the unique Highland area in future.

During general discussion, Members raised the following issues:-

• it had to be highlighted that a ‘flat cash settlement’ for the Highland Council was actually a ‘cut’ in real terms and this budget was the best which could be presented under these circumstances;
• the freezing of Council Tax over recent years had meant a loss of income for Councils and this had caused considerable problems;
• earlier notification of the grant settlement figure and the opportunity for multi-year budgets to be considered would be ideal and would help not just the Council but also partners across the Highland area;
• it should be noted that Highland Council was currently one of the top 10 Councils in terms of funding in Scotland and this compared very favourably with the situation for Councils in England and Wales;
• it had been identified that the cost of living in rural areas of the Highlands was 40% higher than elsewhere in the area and this proved that funding was not sufficient;
• it would be helpful if all political groups within the Highland Council could be fully involved in the budget process;
• the poor condition of roads across the Highland area was of particular concern, not least in terms of the potential detrimental effect on tourism in future;
• there was an acknowledgement that difficult discussions had been held within the Administration in regard to the Capital Programme but it was hoped that final decisions could be reached following debate at the next meeting;
• the leaking of early budget proposals to the local media had caused considerable and serious distress to many people throughout the Highlands, not least because many people did not fully understand the budget process,  and this was very much regretted;
• the grant settlement was a very complicated and complex process which many experienced Council staff often struggled with in terms of final figures and this was not a good situation for anyone. Also, there had been no mention within these figures of the cost to the Council of just ‘standing still’;
• there had been mention of budget consultation being undertaken by the Council but many people (within and outwith the Council) had been unaware of this consultation; and
• it was almost impossible to challenge the figures presented as part of the budget process whilst looking for an alternative approach, mainly because of the complexities of the current financial journal system, and it was hoped that this could be updated or amended to make this easier in future (perhaps through a system of zero based budgeting with accurate/updated information).

At this point, and prior to consideration of Booklet A – Summary of Proposed Budget Savings – the Council AGREED a 3% increase in Council Tax as detailed in Section 8.4 of the report.   

Thereafter, specific Service related issues were raised by Members as follows:-

Care & Learning

CL6 – Family Teams – Reduce Staffing in Family Teams – suggested that this proposal would disproportionately impact rural and vulnerable groups across the Highland area and lead to a diminution of service.     

CL8 – Other Leisure Services – Reduction in Eden Court Funding – suggested that this reduction in funding should be re-considered as Eden Court was a much needed resource for the whole of the Highlands and beyond and was open to everyone, including those with disabilities and the vulnerable. Also, it was felt that the Council had a duty to support and encourage the creative outreach programme for young people in particular and this could be put at risk if this proposal went ahead. 

CL10 – Services for Adults – Reduce budget for Adult Support Services – suggested that the 10% reduction for Women’s Aid groups would place more pressure on Family Teams at a time when their staffing was also being reduced (as above).

Also, the report stated that the reduction of funding to Blindcraft of 10% would involve a ‘slight impact’ on service but it was suggested that this was questionable and that the impact could in fact be considerable.  

CL17 – Childcare and Early Learning – Reduce financial support to childcare providers – suggested that early intervention was crucial and this proposal would be detrimental for all concerned and could also lead to the withdrawal of services by partners.       

Chief Executive’s Office

CEO1 – Operational Management Areas – Reduce residual Ward Discretionary Budget by 50% - it was noted that a proposed amendment had been received for the inclusion of a qualifying clause that Sutherland Wards 1 & 4 should be exempted and that each should retain the previously agreed amount of £31,798 – with the revenue cost to the Council being £31,798 (and compensatory funding coming from the Capital budget). (This amendment was not seconded at the meeting)   

CEO2 – Policy & Reform – Reduce Community Council grants – it was noted that a proposed amendment had been received for the inclusion of a qualifying clause that Sutherland Community Councils should be exempted from this proposal and that they should retain their previous full amount of funding – with the estimated revenue cost to the Council being £6,000 in the coming financial year (and compensatory funding coming from the Capital budget). (This amendment was not seconded at the meeting). 

Corporate Resources

CR2 – Customer Services – Efficiency Savings – the report had stated that there was scope to manage the workload across the Service more efficiently which would be enabled by ‘fit for purpose IT’ but this was questioned in terms of the operation of the current system and the issues which had been experienced. Also, there was mention of the ‘effective management of vacant posts’ and the ‘scope for new partnership working’ but both of these issues had been contained in previous reports in previous years and it was suggested that more specific detail was now required in terms of implementation. 

CR3 – Service Wide – Efficiencies across the new enlarged Service delivered by process improvements including the more effective use of IT – as with CR2 above, it was suggested that more specific detail was required in terms of how this particular saving would be achieved.

Community Services

CS1 – Amenity Services – Review of all Play Areas – suggested that there were real issues with the proposal to remove play equipment which was no longer considered to be ‘fit for purpose’ and the way in which this was to be undertaken. Specifically, there was a real possibility that many communities across the Highlands would now be left with no provision whatsoever and this would severely impact young people in particular in those areas. Also, the proposed removal of 2 FTE posts would prevent the replacement of any equipment as new equipment required to be regularly inspected.

It had been stated that a more strategic approach to providing outdoor play facilities was being developed and that discussion was being undertaken with the Care and Learning Alliance, Highland Third Sector Interface and other third sector partners to explore opportunities. In this regard, it was suggested that this should be completed before any further action was taken.       

CS5 – Car Parks – Charging for Parking and Services – suggested that an economic impact study should have been undertaken in relation to this proposal in the first instance, as well as discussion at Local Committee level, as there were real concerns about the potential impact on rural communities in particular and also the effect on the Nairn BID and Nairn Town Centre where it was vital to encourage and maintain local trade (not least in view of the forthcoming By-Pass which it was feared could have a detrimental effect on shopping in Nairn). In addition, two of the identified car parks were not in fact in the ownership of the Council and it was hoped that they could be removed.

In terms of the proposed saving of £1.407m, there had been discussion and consideration of this issue by the Redesign Board and through the Peer Review process but to date no detailed proposals had come forward. As such, there was concern that this target saving was being passed to the Redesign Board which would considerably change the remit of the Board.   

Overall, there was a need for further consultation and detailed analysis of local area circumstances (including Nairn, Dingwall and Alness) before any further action was taken on this proposal. In this regard, the commitment which had been given for all selected sites to be subject to more detailed review and consultation prior to implementation was welcomed.

It was however highlighted that charges were currently already being levied in some parts of the Highlands and this proposal would introduce tariffs which were very competitive compared to both the private sector and other similar facilities provided in the Highland area and nationally.

CS9 – Environmental Health – Uplift current Environmental Health Fees & Charges by 10% - suggested that the proposed uplift in current fees and charges, specifically in relation to Fish Export Certificates, could cause considerable difficulties for local companies and as such there was a need to reconsider this proposal in order to remain competitive. Specifically, the increases which had already been introduced in this regard in the previous year had been contentious with customers within the industry and had led to representations being made to the Council, MPs, MSPs, Council Members and Trade Organisations and a repeat of this situation would be detrimental for all concerned. 

CS15 – Integrated Transport Services – New Charges – Establish an MOT Test Centre – suggested that the proposed income figure should be increased by £10k with this additional sum being put towards the supply of grit bins. 

CS16 – Lighting Services – Communities to provide their own Christmas Lights – suggested that this proposal (which equated to a saving of £35k) would impact on communities across the Highlands. Also, other savings proposals in relation to reductions in the Ward Discretionary budgets and Community Council grants would mean that it would now be more difficult for communities to access funding from those budgets as an alternative. As such, there should be consultation at Local Committee level before any further action was taken on this proposal.      

CS17 – Public Conveniences – Review of Public Conveniences – whilst it was acknowledged that a review of public conveniences was required, it was suggested that this particular proposal did not fit with the aims of localism and community empowerment which had previously been agreed by the Council. If this proposal went ahead, it would particularly impact remote and rural areas (not least in terms of tourism) and as such there should have been meaningful and constructive engagement with local communities in the first instance.

It was also suggested that consideration should be given to the potential transfer of public conveniences to local ownership where this was feasible.  

CS32 – Flood Alleviation – Reduce Flood Alleviation Budget – there was real concern about the impact on properties at risk of flooding and on rural communities in particular in relation to reducing this budget (thereby leaving little budget available for flood alleviation works). Also, it was being proposed that works identified through watercourse inspections would require to be funded from the Area Roads Budgets or (if significant) through the Capital Programme which was not considered to be acceptable.        

Development & Infrastructure

DI3 – Flood Risk Assessment – Reduce revenue budget for flood risk management – suggested that the proposed revenue reduction of £140k (leaving an annual budget of £24k which would be augmented by the Flood Risk Management Plan budget line in the proposed Capital Programme under Flood Protection) represented a major risk, particularly in relation to any potential future increase in project costs.    

DI11 – Energy & Sustainability – Increase in Renewable Heat Incentive budget to reflect current income and new projects – suggested that more detail was required in terms of this savings proposal.

DI12 – Service Wide – Deletion of vacant posts and vacancy management – suggested that further detail was also required in terms of this savings proposal. 

Redesign – Corporate Target

In regard to the corporate savings target of £2.250m which had been allocated for redesign, it was suggested that more detail was required in terms of this particular proposal. Specifically, there was concern that this would change the ethos of the Redesign Board process and that this figure would in fact be unachievable within the required timescale.   

Thereafter - and on the basis that the Budget Leader, seconded by the Depute Leader of the Council, had already MOVED the recommendations within the report –

Mr R Laird, seconded by Mr D Louden, moved as an AMENDMENT that determination of the savings proposals in Booklets A/B and in Paragraph 9.2 of the report should be deferred to enable alternatives to be produced and the implications to be properly considered. Also, that determination of the loans budget for loans charges should be deferred to enable it to be considered alongside the Capital Budget.

On a vote being taken, the MOTION received 47 votes and the AMENDMENT received 19 votes and the MOTION was therefore CARRIED, the votes having been cast as follows:-

For the Motion:
Mr A MacKinnon; Mr A Christie; Mr D Macpherson; Mr R Balfour; Miss J Campbell; Mrs C Wilson; Mr G Ross; Mr L Fraser; Mr T Heggie; Mrs B McAllister; Mrs D MacKay; Mr A Jarvie; Mr G Cruickshank; Mr J Gordon; Mr R MacDonald; Mr H Morrison; Mr J Finlayson; Mr B Thompson; Mr M Finlayson; Mr R Gale; Mr G Adam; Mr A Graham; Mr D MacLeod; Mr P Saggers; Mr J Bruce; Mr W MacKay; Ms N Sinclair; Mr D MacKay; Mr M Reiss; Mrs F Robertson; Mrs I Campbell; Mrs J Barclay; Mrs C Caddick; Mrs A MacLean; Mrs T Robertson; Mr C Smith; Mr S Mackie; Mrs I MacKenzie; Mr A Sinclair; Mr B Lobban; Mr A Henderson; Mrs H Carmichael; Mrs M Davidson; Mr A Baxter; Mr J Gray; Mr J McGillivray and Ms L Munro.     

For the Amendment:
Mr R Laird; Mr D Louden; Mr R Bremner; Ms K Currie; Mr K Rosie; Mr K Gowans; Mr C MacLeod; Mr R MacWilliam; Mr B Boyd; Ms E Knox; Mrs P Munro; Mrs M Cockburn; Mr C Fraser; Mrs G Campbell-Sinclair; Dr I Cockburn; Mrs L MacDonald; Mr G MacKenzie; Mr B Allan and Mr N McLean.

Following further discussion, it was also AGREED to accept a proposal from Mr G Cruickshank, seconded by Mr C Smith, that the proposed income figure in relation to establishment of an MOT Test Centre should be increased by £10k with this additional sum being put towards the supply of grit bins. In this regard, it was noted that additional income would not be achievable until 2019/20 so in order to achieve this proposal in 2018/19 the cost would be met from increasing saving CR 9 (Insurance Fund) as an additional one-off contribution.

At this point in the meeting, and in response to earlier comments in relation to the Council’s financial procedures and the lack of available information in order to identify alternative budget savings, both the Depute Chief Executive/Director of Corporate Resources and the Leader of the Council provided full assurance that the Council had sound financial management in place and this had been confirmed over previous years by the Council’s External Auditors and had been specifically mentioned by Audit Scotland in a recent Annual Report. In addition, the Council had performed extremely well in regard to national performance indicators.

Whilst it was acknowledged that it had been difficult for alternative savings proposals to be identified by individual Members due to the complexity of the financial information and the fact that income and expenditure did not always follow a specific pattern, it was highlighted that discussion with both Budget Holders and Accountants could be undertaken in future in order to be fully informed on specific cost centres and that it was expected that further clarity could be provided as part of the forthcoming zero based budgeting exercise.          
   
Decision

The Council:-

(i)    AGREED a 3% increase in Council Tax as detailed in Section 8.4 of the report; 
(ii)   AGREED the specific proposals for additional income and reduced expenditure as per the savings proposals outlined in Booklet A and detailed in Booklet B. It was also AGREED that in relation to CS15 (Integrated Transport Services – New Charges – Establishment of an MOT Test Centre), the proposed income figure should be increased by £10k with this additional sum being put towards the supply of grit bins – in this regard, it was noted that additional income would not be achievable until 2019/20 so in order to achieve this proposal in 2018/19 the cost would be met from increasing saving CR9 (Insurance Fund) as an additional one-off contribution;
(iii)   AGREED to no increase in the revenue budget for loans charges, thereby limiting capital spend to that which could be financed from the current loans charges budget of £56.7m; and
(iv)   NOTED the delivery of the savings approved in previous years as outlined in Paragraph 9.2 of the report.
   
5. Housing Revenue Account – Revenue Estimates 2018/19  
Cunntas Teachd-a-steach Taigheadais – Tuairmsean Teachd-a-steach 2018/19

It was noted that, at its meeting on 25 January 2018, the People Committee had agreed to make recommendations to the Council in relation to the Housing Revenue Account – Revenue Estimates 2018/19.

In this connection, an Extract from the Minutes of that Meeting had been circulated.

During discussion, and on a day of recognising the hard decisions and many challenges facing the Council, it was confirmed that being able to limit the increase to 0.5% for Council House rents in 2018/19 was good news for residents and the Highlands and compared very favourably with the rest of Scotland. 

Also, the Council was able to invest more in housing stock, particularly in terms of repairs and maintenance, and there was a need to highlight and welcome the allocation of £28m from the Scottish Government to Highland Council for the Affordable Housing Programme, specifically in terms of this allocation being the second highest in Scotland.

There was also a need to congratulate the staff concerned in the work processes which had helped to facilitate this modest increase and also in relation to the estimated HRA surplus of £4.722m in 2018/19 which would be applied as Capital from Current Revenue to fund HRA capital investment. Overall, this highlighted the possibilities which existed for the Council should it be able to have greater control over its own revenue in future.

It was also suggested that if the current issues with both housing debt and housing legislation could be resolved then it would considerable help with solving the current housing crisis in the Highlands.

Finally, and in relation to the proposal that the next review of the Scheme of Delegation should consider the delegation of the setting of garage rents to Local Committees, it was suggested that the relevant Policy Development Group should also give consideration to the delegation of the whole housing rent scheme to Local Committees at the same time.        

Decision 

The Council AGREED:-

(i)    a 0.5% increase for Council House rents for 2018/2019;
(ii)   that the above percentage increase (0.5%) be applied to all residential HRA rents and service charges and to Gypsy/Traveller site pitches;
(iii)  that rents for garages and garage sites be increased by 3%;
(iv)  that non-HRA rents for leased property should increase as stipulated in existing contracts; 
(v)   that the estimated HRA surplus of £4.722m in 2018/2019 be applied as Capital from Current Revenue to fund HRA capital investment; and
(vi)  that proposals on delegation of functions on setting garage rents to Local Committees be included as part of the next planned review of the Scheme of Delegation.

At this point in the meeting, the Leader of the Council thanked the Budget Team for the considerable level of work which had been undertaken in very difficult circumstances. In this regard, and in confirming that the budget process would now begin again for the following year, she expressed the hope that discussions could be undertaken on a cross Chamber basis as much as possible for the good of the Highlands.

In addition, she conveyed her deep concern and anger at the leaking of early and draft budget information in recent weeks which had caused a high level of unnecessary distress for children, families and communities across the Highland area and stressed that this should not be repeated in future.

Finally, and with regard to the Scottish Government Revenue Grant, she highlighted the need for earlier notification to Councils of grant settlement figures in future if possible in order to allow time for planning for the new financial year.     

6. Membership of Committees, Sub Committees, etc
Ballrachd air Comataidhean, msaa

It was NOTED that Mr J McGillivray had left the Independent Group and would now be a Sutherland Independent Member. In addition, Mr K Gowans had left the Independent Group and would now be Non-Aligned. 

On that basis, the political make-up of the Council was now as follows:-

Independent – 28/SNP – 19/Scottish Conservatives – 10/Liberal Democrat – 9/Labour – 3/Green Party – 1/Sutherland Independent – 1/Non-Aligned – 2

It was further NOTED that the formula in respect of the number of places on Strategic Committees remained as 10/7/4/3/1.

The Council also AGREED the following changes of membership: – 

Environment, Development & Infrastructure Committee – Mr M Finlayson to replace Mr K Gowans

Audit & Scrutiny Committee – Mr D MacKay to replace Mr K Gowans

Redesign Board – Mr L Fraser to replace Mr K Gowans 

Valuation Joint Board – Ms M Smith to replace Mr W MacLachlan
Valuation Joint Board – Mr A MacKinnon to replace Mr K Gowans
Valuation Joint Board (Substitute) – Mr D Macpherson to replace Mr A MacKinnon

CoSLA – Mr S Mackie to replace Mrs A MacLean (with effect from 15 May 2018)

CoSLA Executive Board (Environment and Economy) – Mr D Macpherson to replace Mr K Gowans

Northern Roads Collaboration Joint Committee (Substitute Member) – Mr J Gray to replace Mr K Gowans 

The meeting ended at 3.05pm.

Appendix 1

Declarations of Interest – Item 2

The following Members declared non-financial interests in relation to this item but, having applied the test outlined in Paragraphs 5.2 and 5.3 of the Councillors’ Code of Conduct, concluded that their interests did not preclude their involvement in the discussion and voting (on the basis that they would leave the room should there be any detailed discussion on the specific item in which they had declared an interest):-    

Mr G Adam – Board Member of Eden Court Theatre
Mr R Balfour – Director of Inverness, Badenoch and Strathspey Citizens Advice Bureau
Mr B Boyd – Friend of Eden Court Theatre
Mrs I Campbell – Board Member of Eden Court Theatre
Miss J Campbell – Board Member of Eden Court Theatre
Mr A Christie – General Manager of Inverness, Badenoch and Strathspey Citizens Advice Bureau and Director of Highland and Islands Society for Blind People
Mrs M Cockburn - Director of Inverness, Badenoch and Strathspey Citizens Advice Bureau
Ms K Currie – Board Member of Blas
Mr T Heggie – Director of High Life Highland
Mr A Jarvie – Director of High Life Highland and Director of Inverness, Badenoch and Strathspey Citizens Advice Bureau
Mr R Laird – Director of Merkinch Enterprise and Chair of Merkinch Partnership    
Mrs L MacDonald – Family member an employee of Blind Craft  
Mr R MacDonald – Director of Skye and Lochalsh Citizens Advice Bureau
Mrs D Mackay – Director of East Sutherland Citizens Advice Bureau and Director of Voluntary Group East Sutherland
Mr W MacKay – Director of Caithness Citizens Advice Bureau, Director of Caithness Horizons, Director of Caithness Mental Health Support Group and Director of Caithness Voluntary Group
Mrs I MacKenzie – Board Member of Inverness Women’s Aid
Mr D Macpherson – Director of High Life Highland, Friend of Eden Court Theatre and Member of the Blas Festival Committee
Mr M Reiss – Director of Caithness Citizens Advice Bureau and Director of Caithness Mental Health Support Group
Mr K Rosie – Director of Caithness Horizons
Mr P Saggers – Director of Nairn Citizens Advice Bureau
Ms L Munro – Director of High Life Highland
Mrs A MacLean – Chair of Ross Shire Women’s Aid

The following Members declared financial interests in relation to this item and confirmed that if there was any specific discussion in relation to specific lines within the budget proposals on the following issues (in which they had either a personal or family connection) they would leave the room:-

Mr I Brown – employee of NHS Highland
Mr A Christie – Non Executive Board Member of NHS Highland
Mr Ken Gowans – previous business relationship with Women's Aid, family member an employee of High Life Highland and child attending After School Club
Mr A Jarvie – family member an employee of CALA and Direct Child Care
Mr W MacKay – family member an employee of High Life Highland