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STAG call - newsletter 2 April 2011

posted 25 Apr 2011, 07:45 by Peter Webb


The founders have busy since the start of the year getting our website up and running. The site has a dual purpose: to help attract new supporters and to keep people who have already registered with us up to date.


Here is a round-up of some of the issues we have been tackling on behalf of our supporters. If you like what we have been doing please encourage your friends to sign-up as supporters, It will not cost them a penny.


  • Council tax freeze…bills are in now….don’t be fooled. With a fanfare Surrey County Council announced that it would be freezing the council tax for 2011-12 but anyone who believes the Council has at last seen the light and entered an era of good budgetary control should think again. SCC has frozen council tax because the government has given them (and other county councils) a one off payment designed to replace the planned increase. The Council intends to increase council tax again next year 2012-13 by £14 million – this after a decade when council tax increased by 80% - more than double the average rate of earnings and the retail price index over the same period.
  • The Value for Money fib. SCC Leader Dr Andrew Povey understandably says that he places great value on good communications with council taxpayers, but it seems this does not stop him from being somewhat less than honest. An SCC press release dated 25th January was headlined “Surrey provides value for money says independent auditor”. STAG was surprised by this and contacted the District auditor (see below) who confirmed directly to us that “I do sufficient work to assess whether or not the Council has met minimum standards in the robustness of its arrangements to secure value for money. I do not provide any assessment on how well these arrangements have been met, nor do I provide any positive assurance that the Council has actually achieved value for money in its individual transactions “. The STAG  ‘certificate’ would read: Undoubted value comes out of SCC but does not match excessive expenditure.
  • District Auditor correspondence – its scope, tactic, topics and result. During February and March an exchange of emails was initiated with the District Auditor in the full view of the SCC’s Leadership who, it may be assumed, were ‘listening’. This followed the 2009-10 audit certifications and Audit Letter supplement. Topics included in addition to the value for money fib were:

The issue of SCC not observing the spirit of timely annual reporting to the electorate was fully explored and principles agreed, but the Auditor said he could not insist on these principles being observed.

There had been a call for the use of reserves to cushion spending cuts.  ‘What reserves?’ we asked, there being no capital subscription or profit to retain. Apparently SCC’s revenue reserves are generated largely by the deliberate over-provision for known or anticipated future liabilities and eventualities.  Fair enough you may think but did we know? Did our money have to be invested at risk with Icelandic banks?  Not only was our formal application for a repayment to taxpayers of £200m  refused but it appears that at 31st March 2009 Surrey and districts held £650m of investments and £350m of unused properties. What does all this say about efficient use of resources and the weight (not) given to financial management of our money? What does it say about the (unmet) need for an annual report?

Constitutional arrangements were discussed. Are they in themselves value for money? There are 30 committees requiring servicing. Member and officer responsibilities are prescribed virtually down to what colour socks to wear. There is an artificial distinction made between elected political managers, and officers whereas in reality the leadership is inescapably responsible for running the council as an enterprise but without the necessary skills and experience being expected of them. Yet we are supposed to correct this with our vote!

The auditor ended  with: “… thank you for understanding that the limits of my role mean I am sometimes unable to take issues further, particularly where they begin to overlap with 'political' issues…I do, however, agree entirely with the sentiment in your email that it is important the audit provides as much added value as possible…”

·         Pensions and Hutton etc. SCC, along with other county councils, has been virtually brought to its knees by the massive black hole in the Council’s pension fund. This black hole was stated by an SCC employee to be around £1 billion earlier this year. Lord Hutton has delivered his final independent report into the massively generous public sector pension arrangements. The report proposes 'comprehensive, long-term structural reform'. Six million workers would have to retire later and pay more for a less generous scheme. Hutton recommends existing final-salary schemes be replaced (by 2015) with new schemes, where an employee's pension entitlement would be still linked to their salary (a 'defined-benefit scheme') but would then be related to their career average earnings, with appropriate adjustments in earlier years to ensure that benefits maintained their value. Normal pension age in most schemes would be tied to the state pension age. A clear cost ceiling would be set for public service pension schemes, limiting the proportion of pensionable pay that taxpayers would contribute. Even so, Ros Altmann, director-general of Saga, said ‘Lord Hutton’s recommendations on public sector pensions will still leave them with hugely generous pensions that most private sector workers could never hope to achieve.’ Note:  Do please look at a more detailed article on Local Pensions on our website

·         General, but important issues. Those of you who keep an eye on our local papers will see that we keep raising important issues via letters to the press; a selection will be found on the website in the What the Press Says section. Freedom of Information (FoI) requests are regularly made to SCC in order to seek a better insight into their financial management. Finally, but very important, one of the STAG team who possesses some specialist experience in the highways area, is closely examining the impact of the new £60 million highways’ contract signed earlier this year with May Gurney.

·         Looking ahead. We are seeking a meeting with a senior figure at the top of SCC to obtain more information and clarification on a number of issues including the continuing disintegration of Surrey’s highways, and to express our disquiet upon the direction SCC is travelling – most notably the proposed further increase in council tax.



Peter Webb – Chief STAG!