On the 28th January 2016, at a national meeting of the police federation branch board chairs and secretaries (Interim National Council), a vote was held as to whether to decrease federation subscriptions by 25% for twelve months.
The vote was:
For: - 25%,
Against: - 72%
Abstain: - 3%
The rationale against the proposed reduction was on the grounds of affordability. Legal fees have increased significantly over the past few years. In addition we have a large liability for the Hillsborough inquiry.
The proposal to implement the 25% reduction of fees was put to the meeting by the South West Region. In representing you I supported this proposal and voted for the 25% reduction as I believe that the Police Federation hold sufficient reserves to fund this reduction. I was satisfied that, in the short term, this could be done without compromising the level of legal support we provide to our members whilst leaving sufficient finances to fund our activities and campaigns.
This is not a view shared by the National Treasurers office who have significant concerns about the reduction in subscription income and spiralling legal costs making the reduction in subscriptions unaffordable. Clearly over 70% of my colleagues agreed with the Treasurer’s office.
I am aware that this is circulating on social media and, for the sake of clarity, I wanted to take the opportunity to set out my stance on this matter.
More Detail for Those Accountants Out There!
Three years ago the Police Federation of England and Wales commissioned an independent review of how it operates and how it could better represent the interests of its members. The review published its report two years ago and made 36 recommendations. At the federation’s annual conference in 2014 conference voted to accept all 36 of the recommendations. Many of these recommendations related to structural changes to the organisation and commitment to more openness and transparency in its decision making.
The review also looked at the financial position of the federation and found it to be very healthy with significant financial reserves being held by the central rank committees. At the time these were assessed as being £35 million. It was also clear that local branch boards also had healthy levels of reserves.
As a result Recommendation 36 was that the level of reserves should be reduced to a level equal to one year’s operating costs. This was to be achieved by reducing subscriptions by 25% for one year with a view to considering if this could be extended for another year once the resources of all the local branch boards had been centralised and a new, cheaper, organisational structure was in place. It was recommended that this should happen in 2015.
Whereas there is significant activity taking place in respect of the majority of the 36 recommendations there was no progress on implementation of a 25% cut in subscription rates. As a result of this the federation chairs and secretaries from the South West region took a proposal to the National Council (which comprises of chairs and secretaries from the 43 federation branches around the country) to implement the 25% cut in subscriptions.
This cut in subscriptions would cost around £7.1M pounds
The proposal was presented on behalf of the South West region by Devon and Cornwall police federation. The proposal detailed the financial picture for the last few years and details of the reserves held. At the end of 2014 there were investments with a market value of £19.9M along with Nett assets of £34M (£27.8M of this in fixed assets like buildings and equipment). In addition there are reserves still held in central rank funds although details of the amounts are not publically available. These figures were drawn from the annual accounts of the National Treasurer which are available of the Police Federation website.
To put this in some context in 2014 the expenditure of the Joint Central Committee (which included £14M in legal fees) was £24M this exceeded income by over £3M. Expenditure is expected to be significantly higher this year mainly to a significant increase in legal fees. In the same period income has fallen.
The South West region is of the opinion that, even taking into account the above, the financial position is such that the decrease in subscriptions as recommended in the independent review is affordable.
Mike White BSc MCMI
Wiltshire Police Federation Joint Branch Board
(Phone: 101, Wiltshire Police extension 30223
(Mobile: 07969 507790