1

Date: 25 November 1996

NORTH LANARKSHIRE COUNCIL

Ref JM/CP

REPORT

To: EDUCATION COMMITTEE Subject: EDUCATION DEPARTMENT REVENUE ESTIMATES 1997/98 BASE SUBMISSIONS

From: DIRECTOR OF FINANCE

1. Introduction

1.1 The purpose of this report is to present to Committee the Department’s base estimates submission for the forthcoming year 1997/98.

1.2 The report to the Finance Committee on 15 August 1996 outlined the approach which was being adopted in compiling the 1997/98 revenue estimates culminating in the fixing of the 1997/98 Council Tax levels on the uniform budget setting day of 6 March 1997.

2. Process

2.1 This year’s process will consist of three stages:-

Stage 1

The initial stage of the exercise will be to determine the cost of the existing level of service provision. The 1996197 approved budget will be the starting point and will be uplifted to include the full impact of the 1996/97 pay award, the re-instatement of the additional vacancy savings which were included as part of the 1996/97 package of reductions, annual operational costs of new facilities coming on-stream for the first time, clearly quantifiable new legislative costs and finally changes previously approved by the Council during 1996/97. Thereafter this will become the base budget for 1997/98.

Stage 2

Application of inflationary increases where appropriate.

Stage 3

Following the Government’s announcement on capping, GAE and revenue support grant settlements, the Council will require to consider spending priorities against a backdrop of reducing resources and competing demands. Decisions will have to be taken on service priorities and the extent of department savings in light of the 1997/98 capping level.

2

3. Outlook For 1997/98

3.1 The 1996/97 budget was set at the capping limit following the implementation of a significant savings package. The Government’s spendmg proposals for 1997198 are likely to be no less severe putting more pressure on the Council to reduce the level of departmental spending. Indeed 1997/98 will be the fourth year in succession that the GAE and capping settlements have failed to recognise pay-awards with such payments once again having to be met fiom efficiency savings and possible cuts in services.

4. DeDartmental Submission

4.1 The first stage of the revenue exercise is now complete and the attached appendices summarise the base budget for 1997/98 prior to consideration being given to

(i) mflationary increases includmg 1997/98 pay awards.

(ii) the effect of the increase in employers superannuation increase.

(iii) the cost to the Council of mainlining Urban Aid funded projects.

(iv) other policy decisions being taken by the Council in relation to service growth bids and expenditure savings.

4.2 The appendices attached include:

(i) Summary of 1996/97 approved budget.

(ii) Increases to cost of existing service provision.

(iii) Explanation of increases.

(iv) Analysis of 1997/98 base estimates by expenditure type.

5 . Recommendations

5.1 The Committee is requested to note the Department’s budget position meantime.

f i Director of inance

EDUCAT.CTE.REMSI97.98

North Lanarkshire Council I

Cost of Existing Service Provision for 1997/ 98 1

-1 EDUCATION

mi EDUCATION

Net approved expenditure per 1996 / 97 Revenue Estimates 1-11

ms Outwith Resource Allocation :

W U C T : Central Repairs Budget

Central Administration Costs

Loan and Interest Charges

LESS : Specific Grants

~ 4,273 I

1 1,3901

11.662 1

~ 6841

Sub - Total 1 16,641 I

ents to Rase Allocation :

Budget Re-alig nments - Within Education - lnsurances - Cornmissionares - Typing Pool

Shortfall 1996197 Wage Awards

180

(32) 21 30

Additional Turnover Savings 1996/97 j 801

ADJUSTED NET EXPENDITURE - BASE FOR 1997 I98 (Form CSP / 2 - Line 1)

1 149,050 1

4

/Department : I

I North Lanarkshire Council I Cost of Existing Service Provision for 1997 / 98 1

149,050 Adjusted Net Expenditure Base for 1997 / 98 (CSP / 1 Line 4)

ADD :

2.1

2.2

2.3

2.4

a. Teachers Increments - Primary Schools b. Teachers Increments - Secondary Schools c. Teachers Increments - Special Schools

a. Young Person's Safety Act b. School Boards Biennial Elections

a. Plains Home Link

a. Impact of Teachers Salaries Recalculation b. Adjustments to School Rolls - .Primary Schools c. Adjustments to School Rolls - Special Schools d. Payments to Scottish Examination Board e. Speech Therapy Contract f. Footwear and Clothing Grants g. Pivot Community Education Centre h. Hearing Impaired Teaching Provision and Support i. Technicians Posts j. Tannoch Place - Rental Payments k. Visually Impaired and Audiologist Staff I. Costs of Decentralisation - Administration Costs m Additional SEEMIS Rentals n. Residential Placements - Dance School of Scotland 0. Special Educational Needs (SEN) - Auxilliary Support Staff p. Increased Number of School Days in 1997198 q. Income Shortfalls - Central Administration r. Income Shortfalls - Music Instructors s. Other Miscellaneous adjustments t. Recorded Pupils U. Kilbowie Income shortfall

123 111 7

I 241 1 2

15

8 8/

2,556 59

597 148 10

185 106 90 52 15 53 9

26 29

233 220 36

120 27

458 70

LESS :

3.1 c. Adjustments to School Rolls - Secondary Schools 545 [71

Existing Service Provision in 1997198 (Part 1 + Part 2 - Part 3 ) 1 153,870 1

North Lanarkshire Council I 5

'Cost of Existing Service Provision for 1997 198 1

2.2a

2.2b

2.3a

2.4a

2.4b

2 . 4 ~

2.4d

2.4e

2.4f

er FXD- of Items Included in CSP 2

Youna Persons' Safety Act There are new licensing requirements arising from the Activity Centre Young Persons Safety Act 1995. The Kilbowie Outdoor Centre cannot operate without this license.

School Boards Biennial Elections This represents the costs of the school board biennial elections due in 1997.

Mainlined Urban Proaramme Pro-iect 1996/97 - Plains Home Link This represents the full year costs associated with the Plains Home Link Project , less the resources already allocated as part of the Revenue Estimates for 1996/97.

Impact of Teachers Salaries Recalculation Finance and Education departments have calculated the actual total salary costs associated with the current Teachers Payroll within North Lanarkshire.

This has been compared to the total DMR budget provision , in order to ensure that the budgeted amount for Teachers Salaries for 1997/98 agrees to the total school entitlement for 1997198.

Adiustment to School Rolls - Primary Schools The formulae for Teaching Provision is based on the numbers of pupils , as represented by the school roll intake for each academic year. The school rolls for the 1997/98 academic year has highlighted an increased Primary population within North Lanarkshire. The impact of this is to require a budget increase as follows :-

(1) Teaching Staff f55,000 (equivalent to 2.5 FTE ). (2) Educational Supplies f4,000.

Adiustment to School Rolls - Special Schools The Teaching Provision is based on the numbers of pupils , as represented by represented by the school roll intake for each academic year. The school rolls for the 1997/98 academic year has highlighted an increased Special population within North Lanarkshire. The impact of this is to require a budget increase as follows :-

(1) Teaching & Support Staff f548,OOO (equivalent to 42.5 FTE ). (2) Educational Supplies f49,OOO.

Pavments to Scottish Examination Board ivj The number of presentations for North Lanarkshire Authority pupils is higher than provided for by the 1996/97 Revenue Estimates. In addition the recharge methodology changed during 1996/97 , resulting in an increased unit cost per presentation.

SDeech Therapv Contract czz

Footwear and Clothina Grants 1851

The contract price for Speech Therapy charged during 1996/97 is greater than the disaggregated resources from Strathclyde Regional Council.

During 1996/97 there has been a higher number of grants awarded than allowed for in the budgetary provision. In addition to which the disaggregation methodology did not adequately reflect the level of deprivation North Lanarkshire.

6

c

LDepartment : 1 EDUCATION rnnn

2.49

2.4h

2.4i

2.4j

2.4k

2.41

2.4m

r FXD\

Pivot Community Education Centre r-Tiq The budget resource for the Pivot Community Education Centre was disaggregated to East Dumbartonshire in error. The Scottish Office, upon confirmation with East Dumbartonshire , have agreed to amend North Lanarkshire's Capping level to reflect this expenditure.

Hearina Impaired Teachina Provision and Support 9oj The budget disaggregation process did not reflect the costs to North Lanarkshire regarding the provision of Hearing Impaired Teaching Provision. The unit was totally disaggregated to South Lanarkshire , being the property base of the unit. North Lanarkshire contribute to the staffing cost of 3 teachers plus 1 administrative assistant, as the unit serves both north and South Lanarkshire. The Scottish Office has agreed that, upon confirmation by South Lanarkshire , the appropriate capping adjustment shall be made to North Lanarkshire's level .

Technicians Posts Three technicians posts were disaggregated between East Dumbartonshire and South Lanarkshire. The problem has arisen that these technicians served 2 schools each , and at reorganisation these schools spilt between North Lanarkshire, South Lanarkshire and East Dumbartonshire. North Lanarkshire Council can quantify their loss of the disaggregation share at f52,OOO. The Scottish Office has agreed that upon confirmation by the other councils involved , the capping figure for North Lanarkshire shall be increased accordingly.

Tannoch Place - Rental Pavment The authority is tied to a lease payment for Tannoch Place Cumbernauld , t i l l the year 2002. No budget resources were disaggregated for this premise.

Visuallv Impaired and Audioloaist Staff Staffing shortfalls have arisen from the disaggregation process :-

(1) 0.5 teaching post for visually impaired to Avon school. (2) 0.5 teaching post for visually impaired to Uddingston Grammar. (3) 1 .O Audiologist post disaggregated to South Lanarkshire.

Education are currently buying in our share of the lost resource , funded from vacancies earlier in the year. The Scottish Office have been contacted regarding this situation.

Costs of Decentralisation - Administration Costs Additional Administration costs have arisen from the decentralisation of the Education department to Coatbridge. This has placed additional burdens on printing, advertising and telephone budgets . This should be offset by a corresponding saving in Apportioned Expenses recharged to Education.

Additional SEEMIS Rentals Additional SEEMIS (DMR system ) Rentals have resulted from reorganisation , due to increased access requirements for :-

(1) Technicians Centre (2) Quality Development Service (3) Community Education

7

post of Existing Service Provision for 1997 I 9 8 I

2.4n

2.40

2 . 4 ~

2.4q

2.4r

2.4s

2.4t

2.4t

3.la

her F w o n s of l temsc luded in CSP 2

Residential Placements - Dance School of Scotland The costs of residential placements exceeds the disaggregated budget for the 8 pupils from North Lanarkshire resident at the Dance School of Scotland. ( 7 of the pupils are residential at a fee of f8,970 , as opposed to the non residential fee of f4,870.

Special Education Needs (SEN) Auxiliary Support Staff The actual staff costs are in excess of the budgetary provision arising from the demand for mainstream integration of SEN pupils .

Increased Number of School Davs in 1997198 The increase in the number of school days during 1997/98 from 195 to 198 , will have a resultant impact upon energy, cleaning, janitorial and replacement teacher budgets.

Income Shortfalls - Central Administration The disaggregated budgets from SRC included recoveries in respect of meals and

catering and charges to users , within Central Administration. North Lanarkshire has no Income generation potential in this area , at an annual loss of income of f 15,000.

Property rentals in respect of Janitors Houses targets fall short of the budgeted provision by f21,OOO.

Income Shortfall - Music Instructors The billings completed in the first half of 1996/97 by North Lanarkshire Council for the charges for specialist music instruction indicates a probable income shortfall o f f 120,000 This is a result of an adverse reaction to the charging policy with parents withdrawing their children from the service , in addition to which the level of exemptions is greater than that originally envisaged.

Other Miscellaneous Adjustments Other adjustments can be summarised as follows :-

(I) Increased N License fees - f 1,000 (2) QDS contribution to SSERC ( costs based on pupil population ) - f3,000. (3) Security measures ( line rental costs ) - f2,000. (4) Education Business Partnership Centre - f6,000 (5 ) Psycological Services - Increased Travel Requirements - f 9,000. (6) Education Resource Transfer - f6,000.

Rcorded PuDils The numbers of recorede pupils has increased , with an equivalent of 0.15 FTE staff input required per recorded pupil.

Recorded Pupils The income generated from the Kilbowie Outdoor Centre is below the budgeted target, as a result of a disaggregation shortfall.

Adjustment to School Rolls - Secondary Schools The formulae for Teaching Provision is based on the numbers of pupils , as represented by the school roll intake for each academic year. The school rolls for the 1997/98 academic year has highlighted an decreased Secondary population within North Lanarkshire. The impact of this is to require a budget reduction as follows :-

(1) Teaching Staff f496,OOO (equivalent to 20 FTE ). (2) Educational Supplies f49,000.

-~ ~- [ North Lanarkshire Council 2

I- Deoartment : b

_ _ _ ~ - ._ ~- I Cost of Existing Service Provision for 1997/98

EMPLOYEE COSTS

PROPERTY COSTS

SUPPLIES & SERVICES

TRANSPORT & PLANT COSTS

ADMINISTRATION COSTS

PAYMENTS TO OTHER BODIES

OTHER EXPENDITURE

LOAN CHARGES

Estimates

€000

EDUCATION

108,214

24,616

10,869

4.713

2,523

6.295

1,754

11,301

LESS : I Items Outwith

Resource

€000

4273

1,390

361

11,301

ADD : ADD :

Allocation in 1997198

€000 €000 €000 €000

839 109,053 3,886 112,939

20,343 272 20,615

10,869 31 10,900

4,713 0 4,713

1,101 29 1,130

6,295 376 6,671

1,393 0 1,393

0 0 0

IGROSS EXPENDITURE 170,285 17,325 807 153,767 4,594 158,361 1 INCOME 5,401 684 4,717 (226) 4,491

North Lanarkshire Council I

~~

f O O O f O O Q

Net approved expenditure per 1996 / 97 Revenue Estimates -5,3677

Cost of Existing Service Provision for 19971 98 I

-1 EDUCATION

-1 PRE-FIVES

I

REDUCT : Central Repairs Budget

Central Administration Costs

Loan and Interest Charges

I items Outwith Resource

Sub - Total

1 161 1

I

Bud get Re-alig nmen ts - Within Education (180)

Shortfall 1996/97 Wage Awards

Additional Turnover Savings 1996/97 180/

ADJUSTED NET EXPENDITURE - BASE FOR 1997/98 (Form CSP / 2 - Line 1)

1 5,109 1

10

LDepartment : 1

' North Lanarkshire Council I ICost of Existing Service Provision for I997 / 98

UCATION - PRE - FIVES

Adjusted Net Expenditure Base for 1997 / 98 (CSP I 1 Line 4) -1

ADD :

2.1

2.2

I Impact of Council Decisions a Urban Programme Mainlining - Forgewood Day Care Centre 51

! i Other lncreses in Expenditure a. Pre - School Community Organisers b. Glengowan Pre-Five Nursery

3 59

0

01

Existing Service Provision in 1997/98 (Part 1 + Part 2 - Part 3 ) 1 5,222 1

I 1

Fufi-ons of Items Included in CSP 2

2 . l a Urban Proaramme Mainlinina - Forgewood Day Care Centre 51/ This represents the full year costs of mainlining the Forgewood Day Care Centre less that previously provided in the Revenue Estimates exercise for 1996/97.

2.2a Pre-School Community Oraanisers 3/ The requirement is for payments for out of hours work associated with the registration of childminders, daycarers , as part of the Childrens Act.

2.2b Glenaowan Pre - Five Nursery 591 This budgeted establishment was disaggregated to South Lanarkshire in error . The Scottish Office have confirmed , after South Lanarkshire agreement was reached , that this sum shall be added to the North Lanarkshire Capping level for 1997/98.

[ North Lanarkshire Council 1 I Cost of Existing Service Provision for 1997/98 1

1 Department : 1 EDUCATION - PRE-FIVE

LESS : ADD : ADD :

1996197 Allocation Allocation

EMPLOYEE COSTS

PROPERTY COSTS

SUPPLIES & SERVICES

TRANSPORT 4% PLANT COSTS

ADMINISTRATION COSTS

PAYMENTS TO OTHER BODIES

OTHER EXPENDITURE

LOAN CHARGES

€000

3,700

905

350

143

124

159

1

35

€000 f 000 €000

16 3,716

161 744

350

143

78 46

159

1

35 0

€000

100

10

1

0

0

0

2

0

Service Provision

€000

3,816

754

351

143

46

159

3

0

GROSS EXPENDITURE 5,417 274 16 5,159 113 5,272 I INCOME 50 50 0 50