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Agenda item

Budget Strategy Paper

Joint Report of the Corporate Director of Regeneration and Local Services and the Corporate Director of Resources / Treasurer to the Joint Committee.

 

Minutes:

The Head of Finance and Transactional Services reminded the Joint Committee that Members had considered a budget strategy paper in September 2017 which had looked at a possible increase in the distribution of surplus to the partner Authorities from 2018/19. 

He added that the purpose of the report as set out in the agenda pack was in a similar vein, to gather the views of Members in advance of the January 2020 meeting that would look at budget proposals.

 

The Head of Finance and Transactional Services noted the issues that may arise in the next few years and options available.  He referred Members to the section of the report that set out the capital investment at the Crematorium totalling approximately £3.7 million and the planned works for the next few years, as outlined within the SAMP.  Members noted that current estimates for the replacement of the cremators was around £1million, though the working life of the equipment was such they would likely not need replacing until around 2030.  Councillors recalled that the previous works had been funded partly by reserves and partly by borrowing, and that payments in terms of the borrowing would end in 2020/21, giving an approximate £214,000 surplus from that point. 

 

Councillor D Bell left the meeting at 2.32pm

 

The Head of Finance and Transactional Services reiterated that the Crematorium business plan was prudent in terms of the numbers of cremations and financial performance and set out that the £214,000 would go back into reserves.  It was highlighted that as the financial position was very strong with the level of reserves already being sufficient to fund cremator replacement.  He explained that accordingly there were options open to the Joint Committee in terms of: potentially reducing fees and charges; investing in the Crematorium, for example water cremation equipment; or increasing the distribution of surplus to the constituent Local Authorities.

 

Members noted that the proposed fee for 2020/21 was £720, the lowest in comparison with other neighbouring facilities, even with a £20 increase on the current £700 charge.  The Head of Finance and Transactional Services noted that Members of the Joint Committee had been mindful in the past to ensure the affordability of the service.  Members were reminded that Mounsett Crematorium Joint Committee had agreed no increase to their fees during the period when Durham Crematorium had undergone its programme of works and that there had been a harmonisation of fees between the two facilities following Local Government Reorganisation.  Members were reminded of the planning permission that had been granted for a new crematorium at Castle Eden.

 

The Head of Finance and Transactional Services noted that the prudent assumption was for 2,200 cremations per year, noting that while it had been consistently above this number, the overachievement of income had allowed for the reserves to build back up quickly. 

 

He referred Members to the table set out at paragraph 23 of the report, a matrix highlighting the potential additional income from a number of cremations each year and with an increase in fee, in £10 increments.  It was explained that the recommendation to the Joint Committee was for an increase to £720, around 3 percent, but with a continued assumption of 2,200 cremations per year, giving an increased income of £44,000.

 

Members were referred to the proposed increased distributable surplus to each partner Authority and asked to consider these, and the increased fees and charges to allow for budget reports to be drafted and to review the budget strategy and surplus redistribution in three years’ time in preparation for the 2023/24 budget setting year.

 

The Head of Finance and Transactional Services noted the recommendation and options as set out within the report and asked Members for feedback in order to be able to draft budget proposals for consideration by the Joint Committee in January.

 

Town Councillor C Sproat noted the fee at Coundon Crematorium was much greater than the proposed fee for Durham and asked if this was simply as Coundon was privately operated or was related to services they provided, for example the ability to take larger individuals.  The Head of Finance and Transactional Services noted the works in 2012 at Durham Crematorium had made it possible for larger individuals to be accommodated.  He added that Coundon was privately operated and this would be a factor in their price.  Town Councillor C Sproat asked if any facility at Castle Eden would be similarly priced to Coundon.  The Bereavement Services Manager and Registrar noted that it was not known, however, it was believed it would be a similar privately-operated facility. 

 

Councillor A Hopgood noted she agreed with the increase in the distribution of surplus, however, asked as regards whether the County Council distribution could be earmarked, noting flooding issues at South Road Cemetery and whether the Joint Committee could allocate as such.  The Head of Finance and Transactional Services noted that the surplus would return to the Council’s Bereavement Services budget, however, it would not be for the Joint Committee to direct where that would be allocated.  The Bereavement Services Manager and Registrar noted within his role he would look at issues that needed to be addressed within the wider service area.

 

Councillor J Blakey asked as regards “pauper’s” funerals, if the County Council had a budget for this and whether numbers were increasing.  The Bereavement Services Manager and Registrar noted there was a budget and numbers were increasing. 

 

The Head of Finance and Transactional Services noted that the Bereavement Services Manager and Registrar would note Members’ concerns and he asked the Joint Committee to recall the addition of direct cremations, cremations without any ceremony.  He added that the information as regards the numbers of those cremations since the scheme came into operation in April 2019 could be included within the next operational report for Members’ information.

 

Town Councillor C Sproat asked as regards the direct cremation fee and the cost of “pauper’s” funeral.  The Head of Finance and Transactional Services noted the direct fees were £590 for an attended cremation, £450 for an unattended cremation.  He added the “pauper’s” funerals were from the wider Bereavement Services budget and therefore outside of the remit of the Joint Committee.  The Chair noted she recalled there was a Government scheme as regards this, the Bereavement Services Manager and Registrar noted there was a funeral expense payment for those eligible.

 

The Chair asked if Members agreed with the recommendation as regards a £20 increase in fee, based on the prudent assumption of 2,200 cremations per year.

 

Resolved:

 

(i)           That the report be noted.

(ii)          That the Central Durham Crematorium Joint Committee approve the proposed increase in the fees and charges, and the surplus redistribution, as identified within the report.

(iii)        That the Joint Committee review the budget strategy and surplus distribution in three years’ time in preparation for the 2023/24 budget setting year.

 

Supporting documents:

 

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