Agenda and minutes

(Director of Governance) To declare interests in any item on this agenda.

To confirm the minutes of the last meeting of the Committee held on 14 July 2016.

            RESOLVED:

That the minutes of the meeting held on 14 July 2016 be taken as read and signed by the Chairman as a correct record.

(Senior Performance Improvement Officer) To consider the attached report (FPM-007-2016/17).

The Director of Resources presented a report on the Key Performance Indicators 2016/17 for Quarter 1 performance.

The Director of Resources advised that the Council was required to make arrangements to secure continuous improvement in the way in which its functions and services were exercised, whilst having regard to a combination of economy, efficiency and effectiveness. As part of the duty to secure continuous improvement, a range of Key Performance Indicators (KPI) relevant to the Council’s service priorities and key objectives were adopted each year and performance against all of these KPIs was reviewed on a quarterly basis.

A set of thirty-seven Key Performance Indicators (KPI) were adopted for 2016/17 in March 2016, which had increased by one because of the waste recycled and waste composted being split into two separate indicators, to enable the performance being  monitored better.

Progress in respect to all of the KPIs was reviewed by Management Board and Overview and Scrutiny at the conclusion of each quarter, and service directors reviewed KPI performance with the relevant portfolio holders on an on-going basis throughout the year. The Select Committees were each responsible for reviewing the  quarterly performance against specific KPIs within their areas of responsibility and the position with regard to the achievement of target performance for the KPIs at the end of quarter 1 (30 June 2016), was as follows:

(a)          25 (68%) indicators had achieved their target;

(b)          12 (32%) indicators had not achieved their target, although 3 (8%) of the indicators had performed within the agreed tolerance for the indicator; and

(c)          29 (78%) of indicators were currently anticipated to achieve year-end target and a further 2 (5%) were uncertain that they would achieve year-end target.

The Director of Resources advised that RES006 (Benefit changes)(days) was the only Resources KPI that had not currently achieved the quarter 1 target but that this was normally rectified throughout the year and that RES001 (Sickness absence)(days) should be reported as ‘Yes’ for achieving the year-end target.

Resolved:

(1)          That the Quarter 1 performance for the Key Performance Indicators adopted for 2016/17 be noted; and

(2)          That there were no Key Performance Indicators for 2016/17 identified that require in-depth scrutiny or further reporting on performance.

Reasons for Decision:

The KPIs provided an opportunity for the Council to focus attention on how specific areas for improvement would be addressed, and how opportunities would be exploited and better outcomes delivered. It was important that relevant performance management processes were in place to review and monitor performance against the key objectives, to ensure their continued achievability and relevance, and to identify proposals for appropriate corrective action in areas of slippage or under performance.

Other Options Considered and Rejected:

No other options were appropriate in this respect. Failure to review and monitor performance could mean that opportunities for improvement were lost and might of had negative implications for judgements made about the progress of the Council. 

(Director of Resources) To consider the attached report (FPM-008-2016/17).

The Director of Resources presented a report regarding the consultation on Business Rates Retention, which included the draft responses of the Society of District Council Treasurers, prepared by the consultancy LG Futures.

In July 2016, the Department for Communities and Local Government (DCLG) issued a twelve week consultation entitled “Self-Sufficient Local Government: 100% Business Rates Retention” that would run up until 26 September 2016. With the introduction of business rate retention in 2013/14 and the substantial changes to the system of funding for local authorities, the significance of retained business rates within the funding structure had increased. The Government had been clear with a strong emphasis for local authorities to become self-financing and reducing their reliance on central grant funding with the ultimate aim of Government policy to introduce 100% business rates retention by the end of the parliament. This would require a completely new system of financing to be designed and implemented, which had been reflected in a number of the consultation questions.The system was still at the design stage and it was impossible to say if the Council would gain or lose from the system overall or that of the many alternatives contained within it.

The Director of Resources advised that the draft responses provided by Society of District Council Treasurers provided a useful background and context for any response that Members decided were appropriate to make to the consultation. The Director of Resources advised that if Members were in support of the draft responses detailed responses in consultation with the Finance Portfolio Holder would be determined.

The Cabinet Committee were in agreement that a response should be completed and raised concerns about more detailed information being required. Members were in favour of seeing growth within the District rewarded and the Council becoming financially independent.

Resolved:

(1)        That the response to the consultation be based on the Society of District Council Treasurers draft response; and

(2)        That the exact responses to each question be determined by the Director of Resources in consultation with the Finance Portfolio Holder.

Reasons for Decision:

To determine the responses to be made to the consultation.

Other Options Considered and Rejected:

Members could decide to not respond, to respond in part or to respond in full to each of the thirty six questions.

(Director of Resources) To consider the attached report (FPM-009-2016/17).

The Director of Resources presented the Annual Outturn Report on the Treasury Management and Prudential Indicators 2015/16.

The Director of Resources reported that the annual treasury report was a requirement of the Council’s reporting procedures and covered the treasury activity for 2015/16 and the actual Prudential Indicators for 2015/16. During the year the Council had financed all of its capital activity through capital receipts, capital grants and revenue contributions. There had been no additional borrowing in the year to add to the £185.456m taken out previously through the Public Works Loan Board (PWLB) to finance the payment in relation to the self-financing of the HRA.  The Council achieved its targets for the treasury and prudential indicators, which would be considered by the Audit and Governance Committee on 19 September 2016.

The Director of Resources advised that in constructing the Treasury Management Strategy Statement and Investment Strategy for 2016/17 to 2018/19, some very prudent restrictions had been applied to some classes of investments. It had become evident that these restrictions were too prudent and cause operational difficulty in managing the Council’s cash flow and some minor changes had been proposed, that would ease the operational difficulties without adding significantly to the risk profile of the Council’s investments. These included the following;

a)            Local Authorities as a group limit was increased from £20m to £25m;

b)            Money Market Funds as a group limit increased from £15m to £20m;and

c)            NatWest (the Council’s banker) increased from £2.5m to £5 m.

The Council’s Advisers, Airlingclose had confirmed the proposals were acceptable as long as the money was only left overnight with Natwest.

Resolved:

(1)          That the Treasury Management Outturn Report for 2015/16 be noted;

(2)          That the outturn for Prudential Indicators shown within the appendices (attached) be noted; and

Recommended:

(3)        That the proposed minor changes to the Council’s Treasury Management Strategy Statement and Investment Strategy be recommended to Cabinet.

Reasons for Decision:

Any amendment to the Treasury Management Strategy Statement and Investment Strategy required approval from Cabinet and ultimately Council. The report and appendices were presented for noting.

Other Options Considered and Rejected:

Members could decide that either no amendments to the Treasury Management Strategy Statement and Investment Strategy were appropriate or that amendments different to those proposed should be made.

(Director of Resources) To consider the attached report (FPM-010-2016/17).

The Assistant Director of Accountancy presented the first quarterly financial monitoring on key areas of income and expenditure for 2016/17, which covered the period from 1 April 2016 to 30 June 2016. The report provided details of the revenue budgets, the Continuing Services Budget and District Development Fund as well as the Capital budgets which included the Major Capital Schemes.

The Cabinet Committee were advised that income was generally up on expectations and expenditure was down. A few points were highlighted as follows, as they were of particular interest;

·                     The investment interest figure had been lower than budgeted because of the  adjustments from the previous year and interest rates had fallen slightly. This had meant that the expected significant capital spend over the next year would have an impact on returns and was unlikely to reach the budgeted level;

·                     Development Control continued on the upward trend with fees and Charges being £51,000 higher than expected and pre-application charges £1,000 higher;

·                     Public Hire licence income and other licensing were below expectations;

·                     The Car Parking income was been erratic and changed monthly with current figures showing that income had exceeding expectations;

·                     The Bed and Breakfast placements expenditure and income was on the increase, with re-imbursement by the Department of Work and Pensions being only around 50% and a similar amount funded through the General Fund, which looked unlikely to be sufficient even though some growth had been budgeted for 2016/17; and

·                     The Council had collected a total of £10,206,011 and had made payments of £8,636,746, which had meant that the Council had benefited from holding £1,569,265 of cash from the effective collection of non-domestic rates.

The Assistant Director of Accountancy advised that the car parking income had been received irregularly and this had been down to the telephone payments being delayed and received later than expected.

The Cabinet Committee commented that the income of the Fleet Operations would need to be monitored closely and that the Local Land Charge income was likely to be suffering from the competition of other providers, as this was a statutory service for the Council.

Resolved:

(1)          That the revenue and capital financial monitoring report for the first quarter of 2016/17 be noted.

Reasons for Decision:

To note the first quarter financial monitoring report for 2016/17.

Other Options Considered and Rejected:

No other options available.

(Director of Resources) To consider the attached report (FPM-011-2016/17).

The Director of Resources presented a report regarding the Council’s Corporate Risk Register.

The Corporate Risk Register had been considered by both the Risk Management Group on 25 August 2016 and Management Board on 31 August 2016. These reviews identified the following amendments;

(a)   Risk 1 - Local Plan

The existing control and effectiveness had been updated to advise of the revision of the Local Development Scheme, which had been adopted by Cabinet on 21 July 2016. A key date of 18 October 2016 had been added for Council approval of the draft plan.

(b)   Risk 2 - Strategic Sites

The Effectiveness of controls/actions had been amended to advise the updated position for the key sites. Work continued to progress well at the Winston Churchill site. The purchase price for St. Johns had been agreed with Essex County Council and approval from the Secretary of State had been achieved. The contract for the Langston Road site had been awarded with work expected to commence in early September 2016. The Pyrles Lane Nursery had been added to the list of strategic sites following District Development Management Control granting consent for the redevelopment of the site and the associated required action advised that there was a need to produce a marketing strategy for the site.

(c)   Risk 5 - Economic Development

The existing control had been amended to reflect the Economic Development and Employment Policies being drafted for inclusion in the Local Plan. Amendment and update had been added as a required further management action, following consultation on the Local Plan.

(d)   Risk 6 - Data/Information

An additional required further management action had been added to advise of the need to update the FOI publication scheme and guide to information.

(e)   Risk 7 - Business Continuity

Following the updating of the Corporate Business Continuity Plan and a re-evaluation, it had been felt that the likelihood of disruption had reduced. To reflect this, the risk score had been amended from C2 (Medium Likelihood/Moderate Impact) to D2 (Low/Very Low Likelihood/Moderate Impact).

(f)    Risk 10 - Housing Capital Finance

There was little likelihood of now having to hand back one-for-one receipts due to the effectiveness of management action, including the purchase of street properties. The risk score had therefore been reduced from B2 (High Likelihood/Moderate Impact) to C2 (Medium Likelihood/Moderate Impact).

RESOLVED:

(1)          That the Existing control, Effectiveness of control and Key Date within the Action Plan for Risk 1 be updated;

(2)          That the Effectiveness of controls/actions and Required further management action for Risk 2 be updated;

(3)          That the Existing Control and the Required further management action for Risk 5 be updated;

(4)          That an additional Required further management action for Risk 6 be added;

(5)          That the Risk Score for Risk 7 be amended;

(6)          That the Risk Score for Risk 10 be amended;

RECOMMENDED:

(7)          That the amended Corporate Risk Register be recommended to Cabinet for approval.

Reasons for Decisions:

It was essential that the Corporate Risk Register was regularly reviewed  ...  view the full minutes text for item 20.

(Director of Resources) To consider the attached report (FPM-012-2016/17).

The Director of Resources presented a report regarding the Annual Governance Report. The International Standard on Auditing 260 required the External Auditor to report to those charged with governance on certain matters before giving an opinion on the Statutory Statement of Accounts.  The audit of the Council’s Statutory Statement of Accounts for 2015/16 would be presented to the Audit and Governance Committee on 19 September 2016.

The audit report highlighted the key findings of the financial statements of the Council for the year ending 31 March 2016, and the Director of Resources advised the Cabinet Sub-Committee of the following key findings:

(a)          Following a review of infrastructure and community assets, officers identified a number of assets for which the Council was no longer responsible. The assets had been written out of accounts and although officers had engaged with the auditors, they had found that no working papers had been prepared to support the initial treatment applied. The management amended the financial statements to reflect the correct treatment. The Director of Resources advised that this had been down to how it had appeared on the balance sheet and had been corrected;

(b)          The related parties identified in the draft financial statements had not met the definition of such transactions as defined by accounting standards. The External Auditors identified that no formal assessment of the relationships disclosed had taken place and management  had removed the incorrect disclosures from the financial statements;

(c)          A tested sample of assets from the asset register revealed that the Council was unable to confirm the location of some works relating to off-street parking associated with the Council dwellings due to the time elapsed since the expenditure had incurred. The Director of Resources advised that to find the records which related to this, would be unfeasible and labour intensive and that they may not even still hold the records;

(d)          There were no matters to report in relation to the annual governance statement;

(e)          That they were satisfied that the Council had adequate arrangements in place to secure economy, efficiency and effectiveness in its use of resources and the anticipate issuing an unqualified value for money conclusion for the year ended 31 March 2016; and

(f)           The Council was below the audit threshold for a full assurance review of the Whole of Government Accounts (WGA) and there was no requirement for further work other than to submit the section on the WGA Assurance Statement to the WGA audit team with the total values for assets, liabilities, income and expenditure.

Resolved:

(1)          That the External Auditor’s Annual Governance Report be noted.

Reasons for Decisions:

To ensure that Members were informed of any significant issues arising from the audit of the Statutory Statement of Accounts.

Other Options Considered and Rejected:

The report was for noting, no specific actions were proposed.

Section 100B(4)(b) of the Local Government Act 1972, requires that the permission of the Chairman be obtained, after prior notice to the Chief Executive, before urgent business not specified in the agenda (including a supplementary agenda of which the statutory period of notice has been given) may be transacted.

It was noted that there was no other urgent business for consideration by the Cabinet Sub-Committee.

Exclusion: To consider whether, under Section 100(A)(4) of the Local Government Act 1972, the public and press should be excluded from the meeting for the items of business set out below on grounds that they will involve the likely disclosure of exempt information as defined in the following paragraph(s) of Part 1 of Schedule 12A of the Act (as amended) or are confidential under Section 100(A)(2):

The Local Government (Access to Information) (Variation) Order 2006, which came into effect on 1 March 2006, requires the Council to consider whether maintaining the exemption listed above outweighs the potential public interest in disclosing the information. Any member who considers that this test should be applied to any currently exempted matter on this agenda should contact the proper officer at least 24 hours prior to the meeting.

Background Papers:  Article 17 - Access to Information, Procedure Rules of the Constitution define background papers as being documents relating to the subject matter of the report which in the Proper Officer's opinion:

(a)        disclose any facts or matters on which the report or an important part of the report is based;  and

(b)        have been relied on to a material extent in preparing the report and does not include published works or those which disclose exempt or confidential information and in respect of executive reports, the advice of any political advisor.

The Council will make available for public inspection for four years after the date of the meeting one copy of each of the documents on the list of background papers.

The Cabinet Sub-Committee noted that there were no items of business on the agenda that necessitated the exclusion of the public and press from the meeting.