Meeting documents
Finance and Best Value Overview and Scrutiny Committee
Monday, 17th September 2007
Present
Chair
CM Teggin
Councillors
SA Brown, FM Doyle, DM Elderton, AER Jones, ED Prout
Index to Minutes
- Minute 14 - DECLARATIONS OF INTEREST/PARTY WHIP
- Minute 15 - MINUTES
- Minute 16 - FINANCIAL MONITORING STATEMENT
- Minute 17 - MONITORING REPORTS
- Minute 18 - PROJECTED BUDGET 2008 - 2011
- Minute 19 - MEDIUM TERM FINANCIAL STRATEGY 2008 - 2011
- Minute 20 - FINANCIAL MONITORING SUMMARY
- Minute 21 - CAPITAL MONITORING SUMMARY
- Minute 22 - SERVICE RE-ENGINEERING SUMMARY
- Minute 23 - COMPREHENSIVE PERFORMANCE ASSESSMENT - USE OF RESOURCES ACTION PLAN
- Minute 24 - INFORMATION AND COMMUNICATION TECHNOLOGIES (ICT) STRATEGY
- Minute 25 - HOUSING AND COUNCIL TAX BENEFITS - ANNUAL REPORT
- Minute 26 - TREASURY BUILDING IMPROVEMENTS
- Minute 27 - LOCAL GOVERNMENT CHRONICLE (LGC) AWARDS 2007
- Minute 28 - CHARTERED INSTITUTE OF PURCHASING AND SUPPLY - ANNUAL AWARDS
- Minute 29 - PROJECTED BUDGET 2008-2011
Minute 14 - DECLARATIONS OF INTEREST/PARTY WHIP
Minute Text :
Members were asked to consider whether they had personal or prejudicial interests in connection with any item(s) on this agenda and, if so, to declare them and state what they were. No such declarations were made.
Minute 15 - MINUTES
Minute Text :
Minute Decision :
Resolved - That the minutes of the meeting held on 19 June 2007, having been received or approved by the Council, be received.
Minute 16 - FINANCIAL MONITORING STATEMENT
Minute Text :
The Director of Finance provided a summary in tabular format of the current position of the Authority revenue accounts and General Fund balances. It was based upon the information provided within the departmental financial monitoring reports and included the composition of the original 2007/2008 budget by department including agreed Service Re-Engineering (SRE) savings, other savings and policy options; monitoring against the 2007/2008 budget including the financial implications of any decisions by the Cabinet; anticipated variance against the original budget; and an explanation of variances and areas identified as requiring further attention.
He commented that the pressures within Adult Social Services and Children & Young People, essentially in relation to care services, continued to be closely monitored. During July, projected overspends of £2.5m and £1.9m were being quoted by the respective Directors and actions continued to be taken to reduce the likely spend in these, and other, areas of the departmental budgets. He reported also that as part of the Local Pay Review the Council was looking to make equal pay settlements during the current financial year, which had to be met from revenue resources unless permission to capitalise the costs was received from the Department for Communities and Local Government (DCLG). A bid to capitalise was submitted by the deadline of 31 May 2007 with the DCLG expected to make a decision by 28 September 2007. He commented that if approval was granted in line with 2006/2007 levels, the latest projections regarding equal pay indicated that the cost to revenue in 2007/2008 would be in the region of £4m, which would reduce the available balance.
Minute Decision :
Resolved -
(1) That the contents of the financial monitoring statement be noted.
(2) That a further update be submitted to the next meeting of this Committee.
Minute 17 - MONITORING REPORTS
Minute Text :
The Director of Finance presented monitoring reports with regard to -
(a) General Financial Matters - information on the money market key indicators, current interest rates, the Council cash position, the position regarding Council Tax, National Non Domestic Rate, general debt and cash income collection and the payment of Benefits. In response to comments from a member with regard to the potential impact on the Council of the difficulties being faced by Northern Rock, the Director indicated that it was considered to be a well run financial institution, however, the Council had no money invested therein. In response to comments with regard to the collection of Council Tax, he indicated that a shortfall that had resulted from the installation of a new IT system had been made up and Wirral now had the fourth largest Council Tax collection of metropolitan authorities in the country. With regard to Car Park Income, an adverse variance was expected at the year end, and the situation was being closely monitored by the Director of Technical Services.
(b) Finance Department Financial Monitoring - one of a series of reports to highlight the financial performance of the Finance Department during 2007/2008.
(c) Treasury Management Financial Monitoring - one of a series of reports to highlight the financial performance of Treasury Management during 2007/2008.
(d) Progress made in Corporate Risk and Insurance Management against the objectives for those services and anticipated developments in the coming months. In response to a comment from a member regarding an administrative error that had led to planning permission being granted for the erection of a number of mobile phone masts, the Director reported that there was no indication that any financial recompense would be sought.
(e) Finance Department 1st Quarter Performance Monitoring Report 2007/2008. In response to a comment regarding the write-off of Housing Benefit overpayments, the Director proposed to present a write-off report to the Cabinet in the near future.
Minute Decision :
Resolved - That the reports be noted.
Minute 18 - PROJECTED BUDGET 2008 - 2011
Minute Text :
The Director of Finance reported that the Department for Communities and Local Government (DCLG) had stated that following the Comprehensive Spending Review (CSR), the Local Government Finance Settlement would cover the period from 2008 to 2011 and that Local Authorities would be expected to budget on a three year basis. He provided an update of the projected budgets for 2008-2011 to coincide with the period of the CSR, and details of variations that had been identified for 2008-2011. He outlined also other developments which were likely to impact on the financial position of the Authority during the three year period, the impact of which would be reported to the Cabinet and reflected in the regular projected budget reports as and when they were resolved.
He reported upon the impact on the projected budget for 2008-2011 of the Local Pay Review and he set out the projected balance as at 31 March 2008. With regard to grants, the Formula Grant was expected to increase by an average of 1.9% per annum in line with indications from DCLG, and the Director assumed that as performance in service delivery had continued to improve, then the level of Benefits Subsidy could be sustained. However, the Chancellor of the Exchequer had indicated in his Pre Budget statement on 6 December 2006 that the efficiency target for Local Authorities for the period of the CSR would be increased from 2.5%, of which 50% was cashable, to 3% all cashable. This efficiency saving was expected to be reflected in a reduction in the Formula Grant.
Members expressed concern with regard to the significant gap between projected expenditure and anticipated resources, which would have to be bridged by a combination of savings and/or increased Council Tax. He referred to the Efficiency Plan agreed by the Cabinet and commented that Chief Officers were still working to deliver proposals to meet those targets. In addition, the Director assumed an annual Council Tax increase of 4%.
Minute Decision :
Resolved - That the projected budget for 2008 to 2011 be updated and reported regularly to this Committee and to the Cabinet.
Minute 19 - MEDIUM TERM FINANCIAL STRATEGY 2008 - 2011
Minute Text :
The Director of Finance provided an update of the Medium Term Financial Strategy 2007/2010, which was agreed by the Cabinet on 23 August 2006. The aim was to give Members a strategic overview of the period 2008/2011 highlighting the significant issues to be considered in conjunction with financial planning and informing future priorities. The Strategy aimed to provide a longer term overview of the financial issues to assist in the allocation of resources to deliver the Council objectives and priorities. The three year period was in line with Government plans to move to three year Local Government Finance Settlements and was in accordance with the Performance Plan requirements and timescales for the Local Area Agreement.
He indicated that Wirral continued to progress performance management and service planning and to re-direct resources towards meeting the identified objectives. In terms of Council Tax and value for money, he commented that the Wirral Band D Tax, which was the fourth highest amongst the 354 Metropolitan, London, Unitary and District Authorities in 2000/2001 was now rated 225th.
Minute Decision :
Resolved -
(1) That the Medium Term Financial Strategy covering the period 2008/2011 be noted.
(2) That regular updates of the financial projections for the period of the Strategy be reported to the Cabinet and to the Finance and Best Value Overview and Scrutiny Committee.
Minute 20 - FINANCIAL MONITORING SUMMARY
Minute Text :
The Director of Finance presented one of a series of reports submitted throughout the year, which provided an overview of the financial performance of the Council. He set out progress on the implementation of policy options, the delivery of savings and the delivery of service re-engineering savings. He provided details of key variations on a departmental basis and a summary of the overall implications for the General Fund. The Directors of Adult Social Services and Children & Young People had both identified pressures in keeping spend within the allocated budget and both had been requested to attend the meeting to explain to the Committee their strategies for achieving the savings still to be identified (minute 12 (19 June 2007) refers).
The Head of Branch - Planning and Resources (Children & Young People) set out progress the Department had made in meeting its savings targets, and commented that a much improved service was now being delivered at a reduced year on year cost in the order of £1.4m. He outlined the steps that had been taken to reduce expenditure and reported that the projected variance of £1.9m had now been reduced to £975,000. In addition, steps were also being taken to maximise levels of grant income. In response to comments from members, he reported that Wirral presently had 644 children in care and he referred to the significant costs that were involved. Paramount concern was that looked after children were safe and having their needs met - albeit at a very high cost. He indicated that measures were in place to reduce the numbers of looked after children but commented that the process was slow and could only be achieved by confident, well trained and experienced social workers.
The Director referred also to the Technical Services Department budget, which was reliant upon income from recycling and car parking. He commented that in recent years the income from car parking had seen reductions from compliance with parking regulations and a reduction in penalty notices as well as consumer resistance to price increases. In response to comments from members, he commented that the situation was being closely monitored and any variations would be reported as soon as realistic outturn projections were available.
Minute Decision :
Resolved -
(1) That the report be noted.
(2) That the officers from the Children and Young People's Department be thanked for their attendance.
(3) That the Director of Adult Social Services be again requested to attend the next meeting of the Committee to explain the departmental strategy for achieving the savings still to be identified.
(4) That the Director of Technical Services be requested to attend the next meeting of the Committee to explain the financial impact on reduced income from car parking, the impact on trade of parking restrictions in central Birkenhead, and to update members on the outcome of discussions with MWDA regarding the share of the sale of recyclates.
Minute 21 - CAPITAL MONITORING SUMMARY
Minute Text :
The Director of Finance reported upon the progress being made in delivering the capital programme for 2007/2008 based on information prepared by each Chief Officer in relation to approval, progress and funding of capital schemes. He provided a summary of expenditure and resources which had been revised for slippage from 2006/2007.
Minute Decision :
Resolved - That the report be noted.
Minute 22 - SERVICE RE-ENGINEERING SUMMARY
Minute Text :
The Director of Finance reported that the budget for 2007/2008 identified gross service re-engineering (SRE) savings of £5.35m and of that sum, £1.2m represented an SRE investment budget. Savings had been apportioned on a departmental basis and the Director provided details of progress being made in achieving those savings. Of the total sum, £2,883,000 had still to be identified and of the £1.2m allocated for SRE investment, £0.6m had been committed to supporting expenditure.
The Director indicated that greatest concern was in relation to Adult Social Services and Technical Services, and members noted that both Directors had been requested to attend the next meeting of the Committee (see minute 20 ante).
Minute Decision :
Resolved -
(1) That the outstanding savings target of £2,883,000 be identified.
(2) That should members consider it necessary to do so, a special meeting be called in order to request the attendance of those Directors whose departmental savings remain a cause for concern.
Minute 23 - COMPREHENSIVE PERFORMANCE ASSESSMENT - USE OF RESOURCES ACTION PLAN
Minute Text :
The Director of Finance reported that the Use of Resources (UoR) was assessed annually by the Audit Commission, and the assessment provided a judgement on performance over five themes: financial reporting; financial management; financial standing; internal control and value for money. He outlined the scoring matrix used by the Audit Commission, which had resulted in an overall score of 2 in 2006. Although the overall score remained unchanged from 2005, the report indicated considerable improvement in the key lines of enquiry scores. The report had also included a suggested Action Plan for 2007 and the Director reported upon progress against it in relation to the five key themes, which would be assessed in the forthcoming UoR inspection.
Minute Decision :
Resolved - That Members note the progress in delivering the Use of Resources Action Plan.
Minute 24 - INFORMATION AND COMMUNICATION TECHNOLOGIES (ICT) STRATEGY
Minute Text :
The Director of Finance reported that the Council was a large user of Information and Communication Technologies (ICT) and as such required a policy to manage and control the investment that it made in ICT and to ensure that its use, and any investment, was aligned with and would support the corporate plan; corporate priorities, aims and objectives; the Medium Term Financial Strategy; the Efficiency Plan; and other corporate strategies. He presented a new ICT Strategy that built on a number of strategic decisions that had been approved by the Cabinet in recent years and which addressed a number of key areas.
Minute Decision :
Resolved - That the report be noted.
Minute 25 - HOUSING AND COUNCIL TAX BENEFITS - ANNUAL REPORT
Minute Text :
The Director of Finance reported on the progress of the Benefits Service over the last year and outlined the challenges to be faced in the coming months. He commented that the service had maintained excellent service standards throughout a period of significant change and continued to make further progress in improvement and enhancement of service delivery. Partnership work continued across the service and strategies were continually reviewed to ensure ability to respond to the changes brought about by DWP Reform and customer expectation.
Minute Decision :
Resolved - That the report be noted.
Minute 26 - TREASURY BUILDING IMPROVEMENTS
Minute Text :
The Director of Finance reported upon four contracts that had been awarded for improvements to the Treasury Building, Cleveland Street, Birkenhead. Improvements were being undertaken in roofing, office ventilation, washrooms and data centre air-conditioning and, in each case, procurement procedures had been managed by the Director of Technical Services as advised by the Procurement Unit.
Minute Decision :
Resolved - That the report be noted.
Minute 27 - LOCAL GOVERNMENT CHRONICLE (LGC) AWARDS 2007
Minute Text :
The Director of Finance reported that he proposed to submit an entry for the Local Government Chronicle (LGC) Awards 2007. He commented that the awards were intended to celebrate the highest levels of achievement in the world of local government and the awards ceremony for shortlisted entries was to take place on 5 November 2007 at the Dorchester Hotel in London. He requested that members give consideration to attendance at the awards ceremony if the authority was shortlisted. There was no charge for entering the awards competition or for attendance at the awards ceremony, and the cost of travel to London and overnight accommodation for those attending could be met from within the existing budget provision.
Minute Decision :
Resolved - That should Wirral be shortlisted for an award, attendance of spokespersons at the LGC Awards Ceremony on 5 November 2007 be agreed and referred to the Cabinet for approval of duty.
Minute 28 - CHARTERED INSTITUTE OF PURCHASING AND SUPPLY - ANNUAL AWARDS
Minute Text :
The Director of Finance reported that Wirral had been shortlisted as part of the Merseyside Collaborative Procurement Group in the Best Public Procurement Project category by the Chartered Institute of Purchasing and Supply, the winners of which would be announced at the Annual Dinner on 20 September 2007. He commented that the Cabinet had approved attendance at the Awards Ceremony, and the Chair would be representing the Committee.
Minute Decision :
Resolved - That the report be noted.
Minute 29 - PROJECTED BUDGET 2008-2011
Minute Text :
The Director of Finance reported that in view of the need to stabilise the budget and the urgent need to make progress on closing Wirral's budget gap for 2008/2009, the Cabinet (minute 203 (06.09.07) refers) had agreed the following Finance savings, which were referred to the Committee for consideration -
ICT Service -
Review of staffing following the creation of a Corporate ICT Unit £100,000
Revenues, Benefits and Customer Services -
Housing/Council Tax Benefit Subsidy £600,000
Saving from the use of integrated IT system
- Staffing ££260,000
- IT Contract £ 120,000
Consequence of decision to stop cash collection at one stop shops £30,000
Financial Services -
Net reduction in Insurance Fund following agreement of the Cabinet report on 16 August £400,000
Minute Decision :
Resolved - That the Finance savings agreed by the Cabinet, be endorsed.
Footnote :
The Chair approved consideration of this matter as an item of urgent business
(Minutes Published: 21 September 2007)