Meeting documents

1 THE ISSUE

This report updates the Executive on progress made towards negotiating a Public Service Agreement (PSA) for Bath & North East Somerset and proposes a process for finalising the agreement as part of the Council's overall service and budget planning and performance management framework.

2 RECOMMENDATION

2.1 That the Executive approve the proposed changes to the housing target as set out in Paragraph 4.5 of this report

2.2 That the Executive endorse the timetable set out in paragraph 4.9 of this report

2.3 That progress on PSA negotiations be reported to Council on 20th February, linked to recommendations contained in the Budget and in the Financial Plan.

3 FINANCIAL IMPLICATIONS

3.1 The signing of a PSA provides the opportunity for the Council to gain access to significant capital funding. The Financial Plan review proposes that provision be made for the Council to draw on an additional £1.9m of capital funding to be made available through Unsupported Credit Approvals (UCAs) as part of the PSA process, phased over the three year life of the PSA.

3.2 Subject to the final agreement, the Council will receive £920,000 in pump-priming money in the financial year 2003-4. It is currently proposed that this be allocated against the individual theme area targets as set out in the Appendix.

3.3 Two capital schemes, for libraries and public conveniences, have ongoing revenue consequences. These have also been highlighted in the Appendix and will need to be incorporated, subject to member agreement, into the Financial Plan review appropriate to the agreed scheme start date.

3.4 The maximum amount of Performance Reward Grant allocated to Bath & North East Somerset's PSA is £3.578m. This means that if 12 target areas are agreed (which is the usual number for a PSA), the maximum Performance Reward Grant for each target area will be £298,162 -i.e. the total amount of PRG divided by 12. If 13 are agreed (the number currently contained in the negotiating document), this drops to £275,227 - i.e., the total amount of PRG divided by 13. The money shared across the 12 or 13 target areas is then allocated to the individual sub-targets within each target area, in proportions as agreed in the negotiations as finalised. Performance Reward Grant is paid in two tranches - in years 2006-7 and 2007-8. In some cases, interim targets are set: where these are reached, some Performance Reward Grant would be paid in 2005-6.

4 THE REPORT

4.1 The Council presented its draft Public Service Agreement to the Government on 18th November 2002. This and the supporting documentation for the bid contained detailed targets based on the 13 theme areas agreed by the Council Executive on 6th November 2002. These in turn were based on a range of national and local priorities as developed over preceding months and as shaped by the Government's rules for the development of Local PSAs.

4.2 The procedure for negotiating a PSA is that on receipt of the bid Government departments should contact the Council to give their views on the various elements contained within it. These include pump-priming requirements, requests for Unsupported Credit Approvals (UCAs), "Freedoms and Flexibilities", and the detail of the "stretch" targets proposed by the Council

4.3 Council officers then discuss these issues in detail directly with Government officials. The aim is to ensure that negotiations focus on delivering stretching but realistic targets which offer value -for- money and genuine service improvements "on the ground", and which reflect local concerns and national priorities. When these detailed discussions have taken place, the Council then draws the strands together and presents its revised draft PSA to central Government. At this stage, the Council can highlight any areas of significant disagreement- for example, freedoms and flexibilities not addressed. The central PSA team at the ODPM then validates this before being passed to a ministerial group for final decision. The final agreements are then signed (this can be through a signing ceremony or by exchange of letters). Pump-priming money, UCAs and freedoms and flexibilities are then made available to the Council.

4.4 In the case of the PSA for Bath & North East Somerset, negotiations are due to be completed on 24 January 2003 and for a revised draft to be sent back to Government on 27 January, based on the negotiations. In common with all other PSAs agreed so far across the country, the speed of response of central Government departments to our proposals has been patchy. Of the 13 targets the Council presented to the Government on November 18, substantive comments have been received so far on only 8. More positively, negotiations on these 8 targets are making good progress, and it is expected that most significant issues can be resolved swiftly. In some cases, the negotiation process has acted as a catalyst for improvements to the target as Government officials have shared best practice with the council and offered specialist advice. The process also gives an opportunity for Government officials to hear about local concerns and for the council to make the case for policy and regulatory change. For example, in the case of the transport target, the Council is negotiating strongly on its case for additional freedoms and flexibilities- although discussions on tour bus issues have now been de-coupled from the PSA and will be taking place separately. In addition, following advice on this year's LTP settlement, which contains significant supported capital approvals for transport, the £95,000 initially requested for Unsupported Credit Approvals has been withdrawn.

4.5 As themes are emerging from the development of the community strategy, there is the potential- even at this stage- to re-focus some targets on these key areas. One example is in the field of housing. One option, for example, would be to develop additional PSA targets around the issue of key worker housing, as part of the housing PSA theme which currently contains targets on Bed and Breakfast. Discussions with partners have shown that the lack of housing linked to employment is having a significant adverse impact on the quality of local services, such as health services. There is the potential for improved joint working and the levering-in of investment (perhaps linked to the Local Strategic Partnership) through a PSA target. Early discussions with central Government shows that this approach would find favour, especially if it were linked to outcomes such as recruitment and retention of staff in public services. If members endorse this approach, a PSA scheme could be drawn up and presented as part of the negotiations.

4.6 Of the remaining five targets, in the case of vehicle crime we have responded to Government requests for more statistics but have not yet so far received any comment back on our substantive stretch target although we have been told that our overall scheme is well-focussed. We have also been informed that the Home Office will look favourably at requests for carry-forwards of community safety grants across financial years, a freedom the Council requested to assist with flexibility across schemes. In the case of the cost-effectiveness target we have been told that we should not expect to receive any comment on this for some time, as apparently even the pilot authorities have not yet signed their agreements on this. In the case of our target on town and city centre retail competitiveness, some general discussions have taken place the central ODPM team, which may lead to the target being revised and/or linked to another theme area to create 12 targets.

4.7 This means that at the end of the agreed negotiating period on 24^th January, we had not received any detailed substantive comment from central Government in the case of our waste and health/leisure themes, although some contact has been made with relevant officials. In order to meet the timescales set out in Paragraph 4.9 below, it is imperative that an early and detailed response be made from central Government in the case of these targets. Our Health and Leisure and Town/City Centre targets both contain important freedom and flexibility requests. However, despite these outstanding issues, the ODPM has given assurances that the overall pump-priming funding of £920,000 has been earmarked for this council in financial year 2003-4, and that the Council may plan on that basis. We also understand that the figure which we have put forward for UCAs is around the figure which may be acceptable but this will not be finalised until ODPM presents its report to ministers.

4.8 The timetable for the PSA is now as follows, subject to speedy responses being received from Government.

APPENDIX : PSA THEMES CONTAINED IN NEGOTIATING DOCUMENT