NEW COUNCILLOR ..PC BUDGETARY SYSTEM

Question

I am having great difficulty in getting my head around the PCs budgetary system. It seems unnecessarily complicated to me.    The PC is operated through a committee system  and I cannot understand why each Committee Chairman is not a budget holder.  To have a system whereby a committee wants to do something yet needs separate  authority to proceed depending on the amount involved seems  absolutely crazy to me. Yes, its fine its OK to hold contingency budgets to give the ability to overspend but the existing system seems to give little empowerment .

 

Similarly, when building bottom up budgets this is surely the most sensible approach i.e. for each Committee to bid to towards a theoretical precept figure and then be cut back if it politically too high

 

Is it me but it just seems so unnecessarily complicated to have too many people involved in making financial decisions.  Surely having set the budget from the precept it makes sense to have a top down system with ownership  .  Do any PCs work like this ?

Answer 1

The budget and precept has to be set and agreed by Full Council, but each committee can be allocated a part of the budget which they can spend without having to be referred back to the Full Council, this will be written in the Terms of Reference.  If there is a finance committee, they will discuss and draft up a budget but it still has to be agreed upon by the full council.

Answer 2

My council has quite a lot of committees but none have the power to spend so all purchases etc. have to go to full council.  It's an option that wouldn't suit some councils, particularly larger ones, but it works for us.  In our case, committees work through the nuts and bolts of a decision, present a recommendation to full council which then agrees (or otherwise) the proposal and any associated expenditure.  This means all councillors are involved in expenditure decisions but not necessarily all the discussion surrounding the recommendation which takes place in committee.
The starting point to change something is to review your committee terms of reference and your financial regulations as authority to spend or be allocated a budget needs to comply with both which may need amending.    Some decisions/expenditure must be taken by full council but your standing orders/financial regulations will highlight these.

Comments

I have as suggested read  para 4 of the Financial Regulations and this decrees authority levels for committees, chairman and Council .  I note that para 4.8 calls for regular updates.   How is this interpreted ?.  Is the "statements  of...." a list of all transactions or just totals and are the "explanations" a separate commentary.   We seem to just a list every so often of the over £500 transactions.     When I first arrived I asked for a statement of progress against budget and this generated the reply what do want to know and why .  Every day is  a learning curve

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As a matter of interest how did you respond to the question "what do you want to know and why'?

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I explained that as a Councillor I felt it was part of my duty to the electorate  to ensure that their money was being spent wisely and an  understanding of the budgetary system and current performance was vital to gaining that knowledge.

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Para 4 is one section of the financial regulations that is almost always adjusted to suit the individual council so may need to be reviewed if it doesn't suit the way you want to work (within the legislation, of course!).  As a councillor I am a member of a finance committee that reviews expenditure against budget on a quarterly basis, reporting to full council any issues (or that there aren't any) that need highlighting so full council doesn't get a separate budget report as such other than at budget setting time when we get a full report as part of the budget setting process.  When I was a clerk for a small council, I produced a budget report on a monthly basis which was part of the usual monthly meeting so everyone got everything.  As I've often said, if the current system doesn't work for you, change it but be careful what you ask for as you could find yourself bogged down with mind-numbing dross sometimes!