The Head of Financial Services introduced the report.  He said that the City Executive Board agreed the recommendations in June.  He highlighted that 78% of the original capital budget agreed in February 2016 had been spent although the capital programme had been monitored monthly and adjusted during the year.  The reasons for the variances were given on page 43.  He also advised that there was one red risk on the corporate risk register which related to the governance of new Council-owned companies.

In response to a questioned, the Head of Financial Services confirmed that the £220k that had been transferred to the capital financing reserve was not earmarked and was a relatively small sum in the context of a £60m capital programme.

The Panel asked what the latest situation was regarding cladding on tower blocks in light of the Grenfell disaster and how any additional costs would be met.  The Head of Financial Services said that it was unclear whether government would provide additional funding to local authorities so it would be a case of looking at reserves generally.  The Council was quantifying what the precise cost of removing cladding from two tower blocks would be but a figure of £1.6m had appeared in the press.  By the next Panel meeting the situation would be clearer.

The Panel asked for a comment on the red risk and the Head of Financial Services said that there was lots of work to do such as creating client side monitoring arrangements for the trading company.  The housing company was more established but was still finding its way.  The Council’s internal auditors would be reviewing company governance arrangements in the coming months.

The Panel noted the report and responses.