The Scrutiny Support Officer submitted a covering report to provide Members with information in respect of the new scrutiny topic regarding fees, charges and income generation in relation to environmental services.
Paragraph 4 of the submitted report highlighted possible areas for discussion and Officers from the Councils Neighbourhoods and Communities Department were in attendance at the meeting to present information on the subject.
G Field, Environment Services Manager, K Garland, Streetscene Services Manager and A Humble, Accounts Team Leader, were welcomed to the meeting. The Panel was advised that fees and charges across Environmental Services equated to approximately £21 million - ranging from the Transporter Bridge, energy income, Area Care and highways maintenance. The biggest source of income to the Council was building cleaning - approximately £2.3 million - and the smallest was street lighting. An itemised list could be provided to Members should they so wish.
The Panel was advised that some areas relied on fees and charges to assist in subsidising the service but it was important to consider the net effect of all the income to the Council in relation to the services it carried out. In terms of external income, there were two main principles - fees and charges and sales and income. Several areas that had previously been provided to the public free of charge, were now being charged for, such as junk job collections and replacement wheeled bins.
The Streetscene Services Manager explained that his area had a relatively flexible income as seasonal staff were employed which allowed a reduction in staff should income targets not be achieved. It was highlighted that there were several areas where associated costs were borne by Area Care but any income generated was allocated to the department that the services was being carried out for - eg grounds maintenance of football pitches, bowling greens, burials, etc. In such instances Area Care was effectively acting as a sub-contractor.
In terms of raising fees and charges by inflation or more/less than inflation, it was explained that certain services could be increased by inflation by statute. Each external income activity had its own external income target and these needed to be monitored and reviewed as necessary. For example, when charging for junk jobs and replacement bins was introduced, the income target was set too high and was not achieved and now needed to be adjusted.
It was queried what was being done within environment services to maximise the total income to the Council. The Environment Services Manager informed the Panel that discussions were on-going in relation to what other services could be undertaken and whether it would be feasible to compete with the external market whilst complying with Government Regulations. Currently, levels of building maintenance to schools and building cleaning to schools including academies had been increased.
It was noted that certain budgets could fluctuate due to swings in demand, such as car parking. Parking tended to have an annual surplus but this had reduced due to the economic downturn. This was an area that needed to be looked at on an annual basis rather than applying the medium term financial plan criteria. A subsidised Christmas parking promotion was currently on offer in selected long stay Council car parks and two hours free parking had also been introduced to encourage people to visit the town centre. Figures in relation to this would be available in February 2014. It was acknowledged that the wider picture needed to be considered as whilst the subsidised parking promotions may have reduced the car parking budget surplus, the economic benefits of attracting visitors to the town, and in turn boosting the local economy in terms of spending and jobs might outweigh this. Feedback from local businesses had been very positive.
In addition, there were some services that were self-financing, therefore, their budgets were ring-fenced - the Licensing Section was one example.
Reference was made to the Area Care team providing additional street cleaning in the town centre at weekends and it was queried whether a charge could be made in relation to cleaning in connection with late-night opening premises such as pubs and takeaways or whether there was a potential to consider including a charge within the licence fee. The Panel requested that this be explored. The Panel was advised that Area Care had recently started to charge for cleaning outside of shop frontages that were situated on private land and that this was carried out under a Service Level Agreement.
The Panel asked whether the tonnages of rubbish collected on a Saturday and Sunday morning (following the busiest nights for late night opening premises in the town centre) could be compared with collections made on a week-day morning in order to identify whether there was a significant difference. The Panel was advised that it was difficult for the Council to decide which services to charge for as many environmental services were currently provided free of charge or at a subsidised rate. Once charging was introduced for a particular service, a drop in demand could sometimes be experienced. Another consideration when introducing charging for a particular service was the likelihood of bad debts. The Accounts Team Leader advised that there had not been any significant problems with bad debts and that charging up front for services was now a preferred option.
In response to a query, the Panel was advised that that the cost of recovering a debt was approximately £70 - £80 and there was currently a total of around £150,000 outstanding debt - predominantly due to outstanding rents/business rates.
Some of the services provided, such as highway schemes, were funded from the capital budget. It was highlighted that around £1 million had been allocated from the LTP this year and £500,000 from the capital programme for resurfacing works on roads, footpaths and cycleways. There would be an impact on the workforce should this capital funding be taken away. Generating external income could be a real bonus to the Council but it was a calculated risk. Certain areas, such as repairs and maintenance works, were more suited to raising external income. Joint working arrangements with other local authorities were also being explored.
The Chair thanked the Officers for attending and for the information provided.
AGREED as follows:-
1. That the information provided be noted.
2. That the Scrutiny Support Officer make enquiries as to whether there was currently a charge attributed to the licence fee in respect of street cleansing in relation to late night opening premises and, if not, that this issue be explored.
3. That the Executive Member for Environment be invited to the next meeting of the Panel to further discuss the issue of income generation relating to environmental services.