Thursday night, Oxford City Council voted, with not a single vote against, to endorse the Labour administration’s proposed budget.

 The key features include:

• Preservation of front-line services without major cutbacks
• No proposals for privatisation, and instead continued “trading” by the council to offer its services to other organisations
• A planning application for new, sustainable housing south of Grenoble Road, investment of £5 million with a social entrepreneur to purchase temporary accommodation within or close to Oxford, and the establishment of a local housing company to support the development of affordable housing
• Continuation, in full, of council tax benefit for those on low incomes
• A wide-ranging capital programme, funding improvements to community centres, Oxford’s parks and sports pavilions, the Museum of Oxford, and thousands of council homes
• Funding of regeneration on the existing Barton estate and on Blackbird Leys
• No reductions in funding for homeless, advice or cultural services for he next four years
• Continuation of the Oxford Living Wage for staff, contractors and suppliers.

This comes in the context of the complete deletion of government “revenue support grant”, and an estimated reduction in funding from retained business rates and council tax of 16%, 14%, 10% and 6% over each of the next four years.  The government has also forced the council to reduce rents in its properties, which will delete over £31 million in funding for new homes and improvements to existing properties over the next four years, and is proposing to charge a “levy” on income from council properties which is to be met by selling off properties.

The Liberal Democrats proposed an amendment which would have reduced the frequency of elections in Oxford, additional expenditure on projects in just one part of the city (North Oxford), and deleted funding for disabled transport.  This was defeated.  The Green Party proposed building housing over city park and ride car parks, in spite of concerns about the living environment this would offer and lack of proper funding, and a number of over-optimistic attempts to raise income (for instance, from car parking, at the same time as slashing the budget for car park maintenance), coupled with risky increases in borrowing.  These proposals were also defeated.

In proposing the Labour budget, Cllr Ed Turner, Deputy Leader and Board Member for Finance, made the following speech to the council meeting:

“Lord Mayor, I am glad, once again, to be proposing the Labour administration’s budget to Council.  We know that this has been another hard year for local public services in our country -; not only with further, savage cuts to government funding, but also with the outrageous provisions in the Housing and Planning Bill currently going through parliament.  This presents challenges for people across our city -; whether it is the employer, public or private, which struggles to recruit, the older person finding his or her warden service removed, the hostel resident not knowing from one day to the next where he or she will be living, the parents anxious about the quality of education their children are receiving.  We cannot solve all of their problems, but we owe it to them, and to all Oxford citizens, to give it our best shot.

Nobody knows or cares more about the situation of Oxford people than our staff, on the frontline.  They have shown it time and time again -; with the awards for the whole council, from the Municipal Journal, from the Association for Public Service Excellence, coming thick and fast, as well as celebration of numerous individual teams, but no less importantly from feedback from the local people.  Yet again, our staff have delivered -; this year as last year, our budget is expected to finish on track, in spite of demanding savings and income generation targets.  And this year as last year, the pressures on our services are growing -; but our staff are proving equal to them.  As councillors, we owe all our staff a particular vote of thanks for their committed service to our council and to local people.  Obviously, as finance lead, I also want to particularly thank the Finance team for its work in putting together this year’s budget -; in spite of the difficult external environment, they have yet again been meticulous.  I was interested, in reading Craig Simmons’ Green Party budget amendment, to see his view that there is 99% consensus on our budgets.  I’m not sure I’d go quite that far -; and today we will be focusing on that part of ourbudgets upon which we may not agree -; but I do detect that there is a growing measure of agreement.  In previous years, we have had to rehearse tired debates about the right committee structures for our council -; things now seem to have moved on. And I am genuinely delighted that there appears to be cross-party support for our proposals to build new housing south of Grenoble Road.  We know that if we obsess about preserving the green belt around Oxford -; what Bob Price has called a “green noose” -; we will close off any prospect of keeping Oxford as a city for those on lower and middle incomes, as well as for those lucky enough already to have a property or to be wealthy -; and I am delighted that this goal of sustainable expansion appears to be shared across our council.

I want to structure my remaining remarks around three key areas.  First, just to sketch our financial picture in general terms.  Secondly, to say something about the way in which we are, nonetheless, investing in our communities in various ways.  Thirdly, to look at the particular challenges we face with respect to housing.  And I would like to draw out some conclusions for public authorities more widely.

On our general financial picture -; we know that we have lost some 47% of government grant between the 2010 general election and this year.  We also know that it is deleted by the final year of our four-year settlement, and indeed we end up in a position of “negative grant” at that stage.  We know that, increasingly, the government is shifting substantial risks onto councils without giving us the tools to mitigate them.  So rather than getting stable government grant, instead we are reliant upon inherently volatile business rate growth.  While the Chancellor may trumpet that local authorities are going to keep more business rates (not that he will give us the power to determine their level in any meaningful way), the combined total of this income is forecast to fall -; by around 16% next year, and then 14%, 10% and 6% over each following year.  And of course, crucially, these figures may get worse still, depending on business rate income and even appeals against past business rate decisions.   From this, four consequences follow: first, we need to retain some flexibility, which we have done by using revenue contributions to capital, so that if there are shortfalls, we face retimetabling some capital schemes, rather than needing to lose staff.  Secondly, we hold appropriate contingencies, for example for things like business rate appeals.  Government has no business complaining about councils setting aside money for risks if, in the same breath, it makes the environment in which we operate massively riskier -; we owe it to local citizens to be sensibly cautious.  Thirdly, we need to retain a diverse set of income streams, and this we are doing: whereas some councils, up and down the country, are privatising services, instead we are actually buying in work across our organisation, and particularly in direct services (but also in, for example, the finance service, HR, legal and business improvement) undertaking work for other organisations.  The fact we are doing this gives the lie to those who say that the private sector is always more efficient, always knows best -; instead our combination of local know-how, decent working conditions for our staff, and public service ethos can be competitive in the marketplace.  It is the privatisers who are the deluded ideologues, not us.  Lastly, we need more than ever before to focus upon priorities -; and under this Labour administration our focus upon avoiding redundancies, narrowing the gap between rich and poor, and improving services, especially for the most vulnerable, is our relentless, driving focus.

This takes me to the next point -; investment in our communities.  Let me take you on a walk down Ashhurst Way, the main road on Rose Hill estate, which I represent.  Actually, it looks better than it did -; thanks to improved parking through our Great Estates programme, which is fully funded in our proposed HRA budget.  On the right hand side of the road, you get to the new Rose Hill community centre -; a fantastic resource, effectively combining a range of services, again, fully funded in this budget.  Practically every visitor I have taken there has been almost blown away by the council’s ambition in investing in this facility.  On the left hand side, the first council houses built in Oxford for a generation, providing homes to families that need them at a price they can afford -; as I will explain, although the government is stopping us repeating this exact initiative, it is also a model for the future.  Then, sadly, we get to the areas we cannot control -; a brilliant children’s centre which will, at best, see a reigning in of services thanks to Tory cuts, and a primary school which has gone into special measures, to which recruitment and retention of staff, not least thanks to our housing crisis, has been a major contributory factor, and where the children had to write to David Cameron just to ask to get the heating fixed.  There is some local consternation, to put it mildly, at the differences in the way the two councils seem to approach the area, and I have to explain that there is a limit to what we in the city council can do.  But at the same time, Ashhurst Way shows what can be done -; and our ambitions are not confined to Rose Hill.  The budget proposes substantial investments: in regeneration in the existing Barton estate, in a renewed commitment to regeneration on the Leys, to the splash feature at Cutteslowe park, to the investment in community centres like East Oxford and South Oxford, with over £1.3 million to protect communities from the scourge of flooding, and for all our communities to a greatly improved, exciting, welcoming Museum of Oxford, freely available to all.  Moreover, this isn’t just about what the Council can do itself -; our budget preserves, in full and in spite of the deletion of government funding, our support of homelessness prevention services of £1.4 million per year, more crucial than ever in the context of our housing crisis and in the light of cuts elsewhere.  We propose preserving, in full, funding for advice services, for the cultural sector, for our brilliantly-successful youth ambition programme, giving all young people opportunities which would otherwise only be available for some.  These are examples of what I mean by needing to prioritise -; across the country, grants are being cut, homeless services reduced, advice agencies closing, youth workers being laid off -; we are saying that, regardless of our statutory duties, for Oxford City Council this work goes to the very heart of our values, to what we are about, and we will do our darnedest to preserve it.  I would add, too, that we are proposing with this budget to fully fund council tax benefit, becoming one of a dwindling minority of councils to do so.  We will not balance our books on the backs of those on the lowest incomes, indeed often those in low paid work.

Let me now turn to housing.  Last year, we proposed substantial new investment in council homes, with just about 1,000 being financed in the HRA business plan.  This year, we are forced by a toxic cocktail of government policies, to change tack: a forced 1% rent cut, being cynically sold to council tenants as an improvement but in reality a back-handed money-saving wheeze to reduce funds for new homes and improvements to existing stock, will take away £31 million over the next four years.  The government, in the Housing and Planning Bill, is giving itself the power to write blank cheques, which can only be paid by us selling off desperately needed council homes -; a crazy policy, especially in an area of acute housing shortage.  And the plan to hammer council tenants with market rents when they hit household earnings of £30,000 per year, will surely force some reluctant tenants to exercise their right to buy.  It is not clear to me why giving someone a property to rent at a price they can afford is sneered at as being a “subsidy” by multi-millionaire ministers, but selling a “starter home” for a quarter of a million pounds which might otherwise have cost £300,000 is a fantastic investment of public money; that, though, is the new reality of government housing policy.  So what are we doing?  First, we are preserving many of the important elements in our Housing Revenue Account budget: the tower block refurbishment, services to our tenants, kitchen and bathroom works, regeneration on the Leys and at Barton, the Great Estates programme.  Secondly, we are proposing to establish a local housing company -; which offers significant potential -; it could offer affordable housing to local people, calling upon the services of the council for maintenance and management; it could build new housing, and potentially reinvest profits from private sale into its social purpose; and it could purchase properties sold under “forced sale” provisions and keep them for rent at an affordable level.  We are also talking with local housing associations about pursuing these objectives.   Thirdly, we are drawing upon our excellent experience at Barton in having a shared stake in new housing development, rather than leaving the provision of affordable housing to negotiation through the planning process alone, by funding our new partnership, at Oxpens, giving us the potential for a high-quality, mixed use development.  Fourth, we in this budget fully resource the purchase of £5 million of property, in partnership with a charity and social investors, to provide temporary accommodation within or at least within easy reach of Oxford.  Fifth, we are putting extra revenue -; now -; into funding our homelessness service, as well as protecting our grants in full.  Sixth, we are reviewing our local plan, trying to identify new sites for housing, while protecting other features of our city, and resourcing this process properly so that we can fend off challenges from those who want to water down our commitment to affordable accommodation in the city.  Seventh, we propose jointly funding a planning application south of Grenoble Road.  This is not a comprehensive set of answers to our housing challenge -; the government is stopping us from doing the sensible thing, and becoming a great housebuilder in the city once again -; but it is a set of answers which should assure the many suffering from no or inadequate housing in Oxford that we will leave no stone unturned in seeking to resolve their plight.

Lord Mayor, I promised, in conclusion, briefly to reflect on some of the things I think this budget tells us about providing public services in a place like Oxford.  First, have faith in your staff, and avoid the sharp suits from firms like Skanska and Carillion seeking to take over your services.  Our staff are our greatest asset and resource, that deserve a supportive working environment and a fair wage.  Council staff can actually beat the private sector time and time again when they go out into the market place and offer their services.  Second, be realistic in your financial estimates -; over-optimistic projections of government grant, or kicking the can down the road on savings, are no substitute for a long term plan; and don’t be afraid of setting aside contingencies if there is a good case for them.  Third, be bold in your ambition -; whether it’s a new community centre, or a new community of over 800 homes, the public sector can have a proud role to play, and austerity shouldn’t limit our ambitions, even if it may change the way we have to deliver them.  Lastly, and perhaps most importantly, hang onto your values.  For our Labour group on this council, this involves working in partnership with our staff, investing in our communities, resisting privatisation, and preserving an unrelenting focus upon narrowing the gap between rich and poor, working to ensure that all have the opportunities that otherwise would only go to those with the means to enjoy them, and safeguarding the services not of those who shout the loudest, but of those who need them the most.  I am confident that this budget achieves those aims, and in doing so remains true to our values, and that is why I commend it to Council.”