Substitutes are not allowed.

Apologies were received on behalf of Councillor Altaf-Khan.

There were no declarations of interest.

For the Panel to note and agree its work plan, which can be adjusted to reflect the wishes of the Panel.

The Scrutiny Officer, Stefan Robinson, explained that a report on Council Tax Exemption Monitoring had been added to the work plan for the 30 January 2019 meeting. The Panel also received further information on crowdfunding initiatives led by local authorities, and agreed to schedule this item for after the budget process in 2019. This would not necessarily need to be a full report, but could consist of examples from other authorities and the Local Government Information Unit (LGIU) briefing on crowdfunding.

Members also clarified the scope of the social value report requested for the next meeting, explaining that they would like to know about how other local authorities monitor social value and apply it in their procurement processes.

For the Panel to approve the record of the meeting held on 4 July 2018.

The Panel asked about progress in publishing an executive summary of the Council’s position in relation to Brexit. The Head of Financial Services, Nigel Kennedy, agreed to make available on the Council’s website an executive summary. The Panel agreed that it was important to show the Council is aware of the impact Brexit may have on the local economy, and that it is prepared for different outcomes.

The notes of the previous meeting were agreed as an accurate record.

Finance Panel noted in January 2018 that the Legal Services income target for 2018/19 was being reduced from £110k to £40k.  The Panel agreed to commission a report from the Head of Law and Governance on Legal Services income generation activities and performance.

The Panel is asked to note and discuss the report.

Anita Bradley, Head of Law and Governance, and Lindsay Cane, Legal Services Manager, have been invited to present the report and answer questions.

The Head of Law and Governance, Anita Bradley, explained that the Panel previously considered an update on Legal Services income generation in January 2018. Previously, the Service had an income target of £110,000 per annum which had not been achieved.  The current target was £40,000 and the Service was likely to receive in the region of £20,000 for the 2018/19 financial year.

The Oxfordshire Legal Hub had not provided the level of work that was expected, and Oxford City Council had picked up the majority of ad-hoc work coming from the Hub. The Council previously had a good stream of income from Milton Keynes Borough Council, but following a restructure, they had insourced much of their work leading to a reduction in income for Oxford City Council. There were also statutory marketing limitations regarding legal services which constrained the Council’s ability to promote its services.

The Legal Services Manager, Lindsay Cane, and the Head of Law and Governance were of the view that the Legal Services market was saturated locally, and that there was not a strong business case to expand its services. It was explained that some councils had moved to an alternative business structure, whereby they sold their services to the public. However, as evidenced by the failings of some local authorities, this has significant financial risks. Given the Council’s proximity to the County Courts in Oxford, there were however opportunities to secure additional work through providing services to them and neighbouring local authorities.

In response to questions, it was explained that negotiations to secure work with Reading Borough Council were ongoing, and that no extra staff were employed to support income generation. The Head of Law and Governance explained that clients did not want to provide written feedback.

The Panel discussed the merits of establishing an alternative business model, and heard that establishing such a model would have ongoing revenue costs, in addition to start-up costs.

The Chair, Councillor Fry, summarised that the market for income generation was limited, and that the Alternative Business Model was not a favoured option. He also noted the constraints in relation to marketing and the difficulties in securing work through the Legal Hub as factors that limited income generation.

This report seeks City Executive Board approval to consult on proposed changes to the Council’s Council Tax Reduction Scheme for 2019/20. 

The Council Tax Reduction Scheme benefits approximately 8,500 households at an estimated to cost the Council £1.4m for the current year and £1.7m from 2019/20.

The Scrutiny Committee has referred this item to Finance Panel for pre-decision scrutiny.  The Panel is asked to note and discuss the report and may wish to agree recommendations to the City Executive Board on 18 September 2018.

Paul Wilding, Revenue and Benefits Programme Manager, has been invited to present the report and answer questions.

The Revenue and Benefits Programme Manager, Paul Wilding, presented a report on the Council Tax Reduction Scheme 2019/20 consultation which was due for consideration by the City Executive Board on 18 September 2018. The report recommended that the proposed scheme be subject to public consultation, with a further report coming forward in January 2019 to summarise the outcome of the consultation process and make proposals for the 2019/20 Council Tax Reduction Scheme. The scheme would then need to be agreed by Full Council.

It was explained that the Council Tax Reduction Scheme (CTRS) benefits approximately 8,500 households at an estimated to cost the Council of £1.4m for the current year and £1.7m from 2019/20. Council Tax support was localised in 2013 and there had been no changes to the CTRS between 2013 and 2017. There were two changes proposed for the 2019/20 Scheme. These were:

·         the income band scheme for residents on Universal Credit, and;

·         the minimum income floor for self-employed people.

The cost of the CTRS was increasing year on year and there had been a significant reduction in government grant. Increasing the rate of collection did not necessarily mean more income would be generated, because there were costs associated with collecting and resolving additional arrears.

The Panel asked about the views of the other precepting authorities on the Council’s proposed CTRS. It was explained that Oxfordshire County Council and the Police and Crime Commissioner had historically supported the City Council’s decisions in relation to CTR, even though they had significant spending implications for the other authorities. A process of consulting these organisations was undertaken each year by the Revenue and Benefits Programme Manager.

In reviewing question 7 in the consultation document, set out below, the Panel suggested that the notion of an ‘established’ business was open to wide interpretation.

·         Question 7: Do you agree with the principle that the council should assume a minimum income level for CTR claimants who are self-employed once their business is established?

The Panel also suggested that question 9 in the consultation document, set out below, would benefit from listing examples of the type of answers people may want to give. This was part of a wider comment that the survey could be made more accessible for people not familiar with the CTRS terminology.

·         Question 9: There are practical limitations for increasing earnings form some type of self-employment (e.g. childminders). Should the Council exempt some types of self-employment from the MIF?

The Panel also questioned what weighting was given to questions 13, 14 and 15 in the survey, which set out alternatives to reducing the amount of CTR available. It was clarified that officers would take into account the consultation and advise councillors accordingly.

The Revenue and Benefits Programme Manager agreed that changes of this nature could be made to improve the survey. However, he said that he did not want the survey to limit the type of responses received. In promoting the CTRS consultation, the Council would use the Communications Team and  ...  view the full minutes text for item 87.

The City Executive Board on 18 September 2018 will be asked to note the Treasury Management Annual Report 2017/18. 

The report sets out the Council’s Treasury Management activity and performance for the financial year 2017/2018, including the returns the Council has earned on its financial investments and prudential indicators.

Finance Panel has a role in monitoring the Council’s Treasury Management function. The Panel is asked to note and discuss the report and may wish to agree recommendations to the City Executive Board.

Nigel Kennedy, Head of Financial Services, and Anna Winship, Management Accountancy Manager, have been invited to present the report and answer questions.

The Head of Financial Services introduced the report and explained that the Council held investments of £80.96 million as at 31st March 2018. Interest earned during the year was £1.55 million against a target of £1.23 million.

The average rate of return on the Council’s investments in 2017/18 was 1.17% compared to 1.05% in 2016/17.The Council had £0.17 million outstanding with the failed Icelandic Bank, and the viability of the remaining balance was under review. It was expected that this would be irrecoverable, and the balance will be written off.

The Bank of England interest rates had risen from 0.25% to 0.50%. In relation to capital expenditure, planned prudential borrowing of £17.420m had slipped significantly to £305,000 owing to slippage in lending to OXWED and the Council’s Housing Company.

The Panel agreed that the report was positive, and showed effective treasury management. Members asked about how the rise in interest rates affected investment returns to the Council. The Head of Financial Services explained that the Council’s investments are primarily located in fixed rate returns.  The change in base rate interest would have an impact of increasing income, but only once current investments expire and new ones are taken out. Investments typically ran for 6 months.

The Panel suggested that it may be worth trying to sell the outstanding £170,000 of debt with the Icelandic banks. It was explained that Deutsche Bank previously bough some of the debt, but the outstanding amount is likely irrecoverable and of little value. Most local authorities had balances outstanding with Icelandic banks.

In response to questions, the Head of Financial Services explained that OXWED were in the process of selecting a preferred development partner, and whilst it had taken some time to get to this stage, work was still progressing.

This report asks the City Executive Board on 18 September 2018 to:

·         Note the projected financial outturn, the current position on risk and performance as at the 30^th June 2018;

·         Recommend to Council to approve the increase of the HRA capital budget for Social Rented Housing Acquisitions by £0.444 million to a total of £1.479 million.  This will be fully funded by Retained Right to Buy capital receipts.  More details are included in paragraph 10; and

·         Recommend to Council to approve the additional capital budget for the Replacement of the Housing Computer System of £0.450 million as per the details in paragraphs 11-12.

Finance Panel has a role in monitoring the Council’s budgetary performance.  The Panel is asked to note and discuss the report and may wish to agree recommendations to the City Executive Board.

Nigel Kennedy, Head of Financial Services, has been invited to present the report and answer questions.

The Management and Accountancy Manager, Anna Winship, introduced the report which updated the Panel on the financial, corporate performance and corporate risk positions of the Council as at 30th June 2018. This report would go to the City Executive Board on 18 September, where they would be asked to recommend to Council:

·         to approve the increase of the Housing Revenue Account capital budget for Social Rented Housing Acquisitions by £0.444 million to a total of £1.479 million.

·         to approve the additional capital budget for the replacement of the Housing Computer System of £0.450m.

The Management and Accountancy Manager explained that There was a forecasted adverse variance of £94,000. This was due to a reduction of £494,000 in car parking revenue (owing to competition from the Westgate Shopping Centre car park) and an underestimation in business rates from the Westgate leading to an additional £400,000. It was clarified that this would be a recurring stream of income for the Council.

An overview of the council’s financial position was given, as set out below:

·         General Fund: The outturn position was forecast to be an adverse variance of £0.094 million against the latest net budget of £22.098m.

·         Housing Revenue Account: The outturn position was forecasting a nil variance against the budgeted deficit of £1.440m.

·         Capital Programme: The outturn position was forecasting a favourable variance of £2.350 million against the latest budget of £114.373m.

The Panel questioned the projected overspend of £0.450m on the Housing System replacement. It was explained that a budget of £1.15m was initially allocated to the project after a soft market testing exercise was undertaken. Having progressed this further, it became apparent that current market products had more to offer and additional functionality, which would enable greater efficiencies across the organisation. The scope has now been revised to include this additional functionality, and as a result, more money was needed.

In response to questions, it was clarified that Oxford Direct Services could be charged to use the new system, but a charging schedule had not yet bee established. The Panel agreed that it wanted to see the revised business case for this system before it went to Full Council for approval.

The Panel requested that the Head of Financial Services provide more information on opportunities to renegotiate the car parking arrangements to ensure a suitable return to the Council. The Panel also asked for further information on the diversity of investment properties by property type, and the strategy for property investment.

Meetings are scheduled as follows:

6 December 2018

16 January 2018

30 January 2019

All meetings start at 6.00pm.