Preparing budget

Question

I am preparing a my own proposed budget as am very dissatisfied with the one prepared by the clerk. I intend to put my version to the council for comments. The one prepared by the clerk lumps together several things I would like to see broken down. Our small 1 person office has a budget of £6000, but this is because that included equipment, phone, broadband as well as normal office supplies. The Clerks regeneration budget includes community services, so it looks like we spend a lot on regeneration but in fact we spend very little.

I need some help - should the figures (actual and proposed budget) include VAT?  We have no income at the moment, other than the annually reclaimed VAT. To me it seems logical to use figures without VAT as we will get it all back but this may not b the correct way of doing things.
Advice appreciated. Than you.

Answer 1

Always without VAT.
It derives from a very old EU policy/regulation that local government must not pay consumption taxes (VAT).

Answer 2

Approach with caution.
It will appear you are undermining the role of the clerk if you present your own budget.
You could request a breakdown of the budget proposal? And perhaps more specific budget lines and codes etc
I would agree with the need for clarity or an explanation.

Comments

I can assure you I have no intention of trying to undermine her role.  I have suggested more specific headings but she has told me that the ones she use are the only ones she's allowed to! I know that is not correct. She knows what I am doing and as Chair, Vice Chair of the finance committee and a councillor trying to improve things I feel I have no option other than to produce a proposed budget format myself. It will be taken first to the finance committee and then to full council. All councillors are responsible for what we spending taxpayers money on but currently are not being given informative information.

Answer 3

It is an unfortunate that some clerks have been brainwashed into the NALC system of minimum  supply of detail thereby building in deniability. Lumping unspecified amounts under vague headings that no one questions is verging on incompetence and indolence and flies in the face of transparency legislation. All finances (including budgets) are open to public scrutiny and councillor responsibility as they are jointly responsible for the finances (not the clerk) So the annual nod through of the budget and precept bid is not acceptable and should be questioned by councillors who are required to take responsibility.

Councillors should ask for breakdowns of every item included in the budget so that tracking of progress during the year can be carried out by the council. Also being  involved in this way should make sure that items are not missed out as we are all human, even clerks. VAT is not included in budget planning and becomes an accountancy exercise for paying and reclaiming

Comments

Thank you Mentorman. I think things have just gone on the same way year after year because no-one has questioned it. Whether through lack of knowledge or because they don't care, I have no idea. I have only been on the council for just over 3 years but have come across several things that really need to change. I do care - so will do my best to make those changes.

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It is quite surprising how one enthusiastic councillor can awaken encourage and galvanise others who have become jaded and apathetic for whatever reason. Engaging with others and pointing out the advantages of doing things" right and efficiently" makes life easier for everyone. Far be it for stating the obvious that this should be one of the Chair's jobs. Leadership is a requirement of the code of conduct. But of course all the reward you will get will be having done the right thing but don't let that stop you.

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Good luck
Our Clerk prepares the Budget and any attempt to raise any points is interpreted as public criticism of her
Last year at the end of the debate I pointed out that it didn’t balance the Chair ridiculed me and said that she and every other Councillor had no idea what I was talking about, I have a recording of this
A couple of Councillors criticised me after the meeting so I wrote to them
At the next meeting there was a £200,000 ( that is not a typo ) reduction in expenditure and had the Budget not been revised we would have run out of money towards the end of the year
Of course there was no apology or change in procedures even though I wrote to the Chair pointing out things needed to change and requesting an apology she never acknowledged it
I can’t imagine any other organisation public or private that tolerates such poor practices

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Many people have lost their way in who makes decisions in the PC. The council should prepare and present the budget THEY require. In an ideal world in close co-operation with specific groups within the council (committees etc) and of course the RFO of the council who has responsibility of controlling finances and should supply historical data and information to assist in the decision making. In my old council the Clerk(RFO) attended as an advisor to every finance committee meeting to ensure that councillors had accurate information on which to base their budget (and precept) requirements and aims.
Unfortunately too many PC members take the easy way out and delegate budgeting (and other decisions) to the RFO rather than put in the effort required and just rubber stamp the decision having no idea of what the budget actually is. Let us not forget that the clerk is there to facilitate the decisions of the council and to advise on legal and other matters as required.

Answer 4

May be suggest that you don’t understand the figures and could it be broken down further for transparency for the public viewing

Comments

Sorry for the delay in replying. I have tried that tack several times. I really have no desire to upset the Clerk (RFO) but I am coming to the conclusion I will have no choice. From the little I have seen of her 'workbooks' in Excel it has become very apparent that her bookkeeping skills are very limited. This is presumably why she is so against producing the budget figures in a manner which gives the council the information it is fully entitled to receive.