To consider the
following finance related reports scheduled for Cabinet
consideration on 11 September:
· Budget and Performance Monitoring Report – 2019/20 Quarter 1
· BCP Council Investment to support the One Dorset Pathology Unity
The O&S Board is asked to scrutinise the reports and make recommendations to Cabinet as appropriate.
Cabinet member invited to attend for this item: Councillor David Brown, Portfolio Holder for Finance.
The Cabinet reports will be published on Tuesday 3 September 2019 and available to view at the following link:
https://democracy.bcpcouncil.gov.uk/ieListDocuments.aspx?CId=285&MId=3721&Ver=4
Minutes:
Quarter One Budget and Performance Monitoring Report 2019/20
The Portfolio Holder for Finance introduced the item explaining that this was the first budget monitoring report for the year and at this point there were often several pressures. However, work was already underway to reduce those pressures. There was detail included within the report on budget pressures within each area. Board Members asked the Portfolio holder a number of questions on the details of the report including:
The Board asked about the increase in the number of cases of Children in Care inherited from the Christchurch area which was higher than previously expected and about the increased number of Education Health and Care Plans inherited and acknowledged that it was difficult to plan for something not anticipated.
A Councillor questioned the increased amount paid to bus companies for concessionary fares. It was noted that this was to harmonise and the rates to bus companies had increased and the bus subsidy renegotiated at the same time. The increase in cost of street lighting was questioned and it was noted that this was down to price inflation. Further information was sought on the cost of staffing pressures at the Two Rivers Meet Leisure Centre and the proportion of the total staffing cost of the pressure. The Councillor requested further information on this.
It was noted that all service areas in which there was a budget pressure would be required to report back on the action which was being taken to manage the budget. The Corporate Management Board was made aware of and addressed budget pressure monthly basis. In response to a question the Board was advised that there was an appreciation by Cabinet Members of the impact of policy decisions on budgets and the budget position was discussed on a weekly basis with Cabinet.
A Board Member explained that there seemed to be a lack of coordination amongst different areas of the Council and suggested that the Board should make a recommendation to Cabinet to request that it practices sustainable budgeting and that whilst reserves could help with long term cost, they should not be used for day to day needs. The move was duly seconded. The Portfolio Holder explained that £2.7million was the base budget contingency decided by the shadow authority. Earmarked reserves were used for a specific purpose but not for ongoing revenue costs. The Chief Financial Officer explained that there was still a huge amount of uncertainty regarding the local government settlement, not helped by current political turbulence. Information may not be received until 5-6 weeks prior to budget setting.
The Chairman commented that the move was in line with the aims of the Board to cement the aspirations of good sustainable decision making with a balanced budget at its heart.
RECOMMENDED that Cabinet should practise sustainable budgeting and avoid using reserves for day to day revenue needs.
Voting: For: 11; Against 0; 3 abstentions
Cllrs M Anderson, B Dove, N Greene, M Greene and M Haines asked to be recorded as voting for the motion.
BCP Council Investment to Support the One Dorset Pathology Unit
The Portfolio Holder introduced the report and explained that the decision would also be considered by the Audit and Governance Committee in November. The Council was interested in different investment opportunities and explained that this would support sustainable budgeting and it would also create an income for the Council.
The Chairman commented that he supported the idea but asked where the funds were coming from in order to finance the loan. It was explained that the loan would use the Council’s treasury management fund. The Chairman requested that he would appreciate it being outlined where funds were coming from within future reports.
A Councillor commented on the recommendation to delegate detailed terms to the Chief Financial Officer and what this would encompass. The Officer explained that he would exercise delegation within acceptable tolerances, in particular, relatively minor finer details but would refer back to Cabinet anything significant.
The Chairman raised a query about approving an investment outside the framework of an approved investment strategy. It was noted that an investment strategy would come to the budget council as part of the new budget setting process.
The Board also questioned the timing of the process and when the loan would begin and start to be repaid and where the Unit would be located. It was noted that these issues were dependent upon the NHS and the timing of when they make decisions on this. The Portfolio Holder was also asked if he was confident on the return in investment and questioned if it should be inflation linked in some way. The Board was advised that in terms of other investment opportunities available the Council could not achieve anywhere near this. It was noted that although this was an unsecured loan it would have the backing of the Department of Health and therefore central government. It was noted that there was a very low risk involved with this but there was also the positive aspect that the residents of Dorset would be getting a top-class facility.
The Chairman advised that the next meeting scheduled for 23 September would be a 4.00pm start to accommodate the 5G connectivity call for evidence session. The Chairman also confirmed that the meeting on 7 October was likely to be a daytime meeting.