Agenda item

Report of the Director of Finance.

The Sub-Committee received a report of the Director of Finance which set out the Council’s revenue monitoring position as at Quarter 2, 2017/18 (30 September 2017).

Following a brief overview of the report by the Director of Finance, Members made the following comments and asked the following questions and officers responded accordingly:

·                     Page 42 savings RES 16: Had the service review of communications taken place?  What was the outcome of the review?  How would this affect communications from the Council? 

An officer advised that no formal review had taken place.  The comment in the report referred to reviewing the saving and ultimately the impact on the service of taking more money out of it.  It was agreed with Members that the nature of the demand on the Communications Team for 2017/18 was such that the impact of taking £57k out and reducing it by more than a post would significantly reduce the impact of what the team could provide.  Therefore in the light of this the £57k has been assumed as a pressure within the Strategic Commissioning Division for 2017/18, and this was being covered.  For the future, options were being considered around how further external income could be delivered which would help offset the overall costs of the service.

The Member asked how the above impacted on residents.

The officer advised that within the Strategic Commissioning Division (where the Comms budget sat) they were in receipt of £85K from the Home Office for the Prevent programme.  These monies were being used to fund an existing post within the Section as well as supporting bringing in additional capacity, which meant that there was a surplus of circa £30k, which was being used to support other pressures in the Divisional budget.  There was also a vacancy in the Policy team which had arisen as a result of the reduction in work from the voluntary sector which amounted to £75K saving in the MTFS.

·                     Did the forecast £164M, which was 83% of the total Capital Programme have contingencies built into it?

The Director of Finance advised that when the budget was set, there was no assumption that funds would be drawn down.  The contingency and reserve funds sat outside the budget and would be used to cover unforeseen costs such as the recent works at Pinner Wood School to make it safe.

·                     Were the figures in Table 10 on page 30 of the agenda relating to carry forward accurate?

The Director of Finance undertook to check the figures and amend the table if they were incorrect.

·                     At the previous meeting of the Sub-Committee Members had requested that the impact and implications of any slippage on the Capital Programme be set out in the report.  Why had this not been done?

The Director of Finance apologised for this oversight and undertook to ensure that this information was provided in all future reports.  She added that a large number of cases, there was no revenue impact of any slippage.

·                     Why had officers’ view of the Infinity project changed over time?

The Director of Finance stated that savings related to the project had already been slipped a year and, considering the certainty of income due and the overall financial position of the council, the decision has been taken to remove the saving from the MTFS.  In the future, in light of the Council’s overall financial position,  there would be more robust oversight of innovative projects such as Infinity before inclusion in the budget.  The product launch would be in March 2018 and it was not possible at this stage to predict how much income it was likely to generate.  Because budgets were extremely tight, it was preferable not to include items such as the Infinity project in the budget as they carried higher risks of not being achieved, and would be more difficult to mitigate against as contingencies were low.

·                     Had the E-purse been considered too speculative to be included in the MTFS (Medium Term Financial Strategy)?  How soon would the MCEP (My Community E-purse) be included in the budget?

·                     How would the Infinity project, even though it was not included in the budget, be continued to be prioritised?

The Director of Finance responded that officers had hoped that it would generate higher income than it had to date.  Any income generated by the MCEP would be treated as a cash windfall in year and built into the budget in the following year.  Work on the development and marketing of Project Infinity  continued and it was estimated a product would be ready for launch in  March 2018.

The Sub-Committee urged that officers follow up progress on the Infinity project and report back to the sub-committee.

·                     Page 43 PA_08:  What was the average wait time for clients?  What effect had this saving had on discharges from hospitals?  The cost of clients spending more time in residential and nursing units?  Who was bearing this cost?  And how was it affecting the quality of life for the people? 

The Director of Finance advised that she was awaiting information regarding waiting time and undertook to circulate this information after the meeting.  She added that discharges were carefully monitored.  Hospital discharge costs were borne by the NHS whereas those from residential care were borne by the Local Authority.

The Member stated that he had submitted his questions ahead of the meeting in order to allow officers to gather information and collate their responses.  He requested that relevant officers attend future meetings of the Sub-Committee to respond to Members’ questions at the meeting.

·                     Page 45 CE_9 what was the target set for the Selective Licensing Scheme?  Has this been met in Edgware Ward or Wealdstone ward?  If not in either or both what effect will this have on tenants in such homes not licensed in terms of their health and Well being? 

The total target for Selective Licensing Scheme was £420k which covered both the staffing costs as well as the income target set in the MTFS.  It was forecast to be fully met from Edgware and Wealdstone wards in 17/18.  There were 3 dedicated residential licensing officers and a support officer covering housing related licensing work and processing applications respectively.  There was no health & safety impact on non-licensed premises as the requirements on the selective licensed premises were around environmental and ASB management mainly.  Other aspects such as fire and safety were covered under legislation for private rented accommodation, including the housing health & safety risk rating system, and would be applicable if a licence was in place or not.

·                     Page 47 CHW 12 What were the improvements that were due to take place at Bannister Centre?  What was the income targets for the Centre?  If these have been missed who bears this cost?  A how are residents of the borough affected by this?

The works planned at Bannister Sports Centre included improvements to grass pitches and the installation of a 3G artificial pitch, the funding for which had been secured via a S106 agreement relating to the development of Harrow View West.  The income budget for Harrow Leisure Centre was approximately £1m per annum.  The non?achievement of MTFS target of £100k in 17/18 was being mitigated by additional income in other services areas within Cultural Services.  The existing leisure centre would remain in operation whilst the new centre was built, so the impact should be minimal.  Plans for the Byron Quarter site included an enlarged separate gymnastics centre for Harrow School of Gymnastics which was very oversubscribed.   The delay in the development as a whole would mean that this over demand was not met for longer.

·                     Page 45 CE_9:  What target had been set for the Selective Licensing Scheme?  Had this been met in Edgware Ward or Wealdstone ward?  If not, in either or both what effect would this have on tenants in such homes not licensed in terms of their health and Well being? 

This had been designated as an Amber saving and officers were forecasting it would be achieved in full.

·                     Page 47 CHW 12:  What improvements were due to take place at the Bannister Centre?  What was the income target for the Centre?  If these had been missed who would bear this cost?  How were residents of the borough affected by this?

·                     Were the Bannister Sports Centre and the Hatch End pool included in the Leisure Contract?  The effects had not been specified in the Public Health programme?

The Director of Finance undertook to seek this information from the relevant directorate and circulate it to Members after the meeting.

·                     Was there a mechanism whereby items marked as amber or red were allocated high priority status in an effort to resolve them?  How were Directorates encouraged?

The Director of Finance advised that the Council’s auditors had stated that the monitoring of those savings flagged as red or amber during the year should be reviewed at year end to ensure their achievement / reversal was not overlooked as the new financial year started.  This was actioned in the 2016/17 Outturn Report.  

·                     What precisely had the auditors meant by more robust processes?

The Director of Finance advised that the auditors felt that there should be processes in place to monitor and deal with any savings flagged up as red and that these should be made more visible and explicit.

·                     The Children’s Capital Project Team was working to resolve a number of building defects with the Council’s contractor, Keepmoat.  What, if any, financial penalties could the Council invoke in this case?

The Director of Finance advised that there was a legal process in place and the case was likely to go to court. 

·                     What was the reason for the overspend in Children’s Services?  Why had this not been foreseen?  What could Harrow learn from other local authorities with regard to this?

The Director of Finance responded that the unprecedented growth in Children’s Services as a result of increased demand, which is difficult to predict, had continued after the 2017/18 budget had been set.  A pan organisation spending freeze has been implemented at the start of the financial year and officers within the Children’s division have and continue to implement a number of actions,  both recurrent and one off, to reduce cost pressures.  The level of demand is showing signs of levelling off and a review of forecasting methodologies had been undertaken.  Another officer added that the phenomenon of increased pressures on Children’s Services was a London-wide issue with demand at its highest in London and the South East.

RESOLVED: That the report be noted.