Tuesday 17 February 2009
Barnet Inflation Shock!
Official figures released today show that the Retail Price Index rate of inflation has fallen from 0.9% to just 0.1% - the lowest level since the 1960s. Regular readers of this blog will know that Barnet Council uses the RPI as its preferred measure of inflation.
In April, our council tax is set to rise by 2.8%. As things stand, this equates to 28 times the rate of inflation!
Last week the Evening Standard published a chart of council tax rises across London. Of the councils to respond, 8 announced a council tax freeze and one council is reducing the charge.
Of the 8 councils freezing the tax, 4 are Labour controlled, which suggests that they received better settlement grants from the Government, two are Conservative controlled, one is Conservative controlled with minority party support and one LibDem controlled with Conservative support. The council reducing tax is, of course, Conservative controlled!
It is not too late for Barnet to reconsider its budget and join the nine London councils offering below inflation increases this year. With Mr Walkley soon to take over as the new Chief Executive, this must be possible. He is the officer who claimed no expenses in 2007/08, so if anyone knows about budget control, it’s him!
Since posting this story, I have read an excellent article written by John Redwood MP, entitled Council Taxes Are Too High - Time For Change.
In discussing how to keep down Council Tax, Mr Redwood says:
So what should Councillors do? They should do what they do with their own family and business budgets. In tight years all items of spending are under review. The aim is to cut out the least desirable items, not the most sensitive, and to deliver the same or more for less by spending more wisely. To do this the first round of budget papers should not present existing spending as a given, but should question why the Council is doing its more marginal things, and question how it can do everything needed more effectively. Councillors should ask amongst other things
1. How much is the budget for Consultants? Why can’t this work be done in house by existing officers? Why are we often paying twice for the same thing?
2. How much is the Council spending on energy? Would spending on insulation, heating controls and better management of buildings use slash this budget in year? Can the energy contracts be renegotiated on more favourable terms?
3. How much is the Council spending on transport? Can the contracts be better managed? Can more transport be grouped to minimise journeys and maximise use?
4. What is the budget for “fact finding travel” and conferences? Is all this necessary?
5. What is the budget for PR? Why can’t Councillors do more of their own communication, without relying on officers who have to be careful not to be political in their messages with Council money?
6. How many surplus assets does the Council have? Can some of these be sold to cut debt?
7. How good is the Council’s cash management? Can they earn a better return on balances without putting it in an Icelandic bank?
8. How many layers of management does the Council have? Why can’t this be slimmed down through natural wastage?
9. Wouldn’t a staff freeze generally be a good idea to make manning more efficient? Couldn’t the Council cut the number of committees which need servicing, and concentrate on the big issues that matter.
10. Why is the Chief Executive’s office so large and expensive. Doesn’t economy begin at the top?
There are certainly some lessons for Barnet here!