To consider the Integrated Performance Report for Quarter 4 2017/18 that was considered by the City Executive Board on 13 June 2018.

The Head of Financial Services introduced the report, highlighting key issues including:

·         The surplus on the general fund was £0.533m after allowing carry forwards to reserves of £0.704m

·         Efficiencies, fees and charges, and service reduction savings were on target at £1.558m

·         The surplus on the housing revenue account was £6.170m, after allowing for carry forwards of £0.495 million against the original budget of £5.619 million

·         £37m of the £54m capital budget for 2017/18 was spent. The most significant slippage in the capital programme related to delays in the transfer of loan funds to other bodies, rather than delays in the completion of major projects

·         There had been an indication that Central Government would reimburse the Council for its spending on replacement cladding on tower blocks.

The Panel questioned how improvements could be made to more accurately predict slippage in the Capital Programme, and expressed concern over the limited number of major projects that had been delivered on time and within budget. The Head of Financial Services said that in some cases, unforeseen planning complications can lead to significant slippage in projects until such a time that they are resolved.

The Panel suggested that it was not clear whether council officers were reassigned to other projects where there were delays in the delivery of the projects they were supporting. It was suggested that a central programme management function within the Council would support improvements in project slippage and staff redeployment.

The Panel requested for their meeting on 30 January 2019, as part of the Capital Strategy Report, that they receive more information to understand what issues cause: the cumulative slippage in major projects, how staff are deployed during project delays, and what lessons can be learnt. The Panel also discussed other areas of programme slippage, and requested the attendance of the Head of Housing and the Chief Technology and Information Officer for the capital strategy item on 30 January 2019. Members highlighted that they wanted to speak to the Chief Technology and Information Officer about the benefits of departing from the previous ICT hardware arrangement with Oxfordshire County Council.

In response to questions, the Head of Financial Services explained that the NNDR Retention Reserve was used to smooth over any business rate deficits between each financial year whilst a surplus is collected in the following year to rebalance the reserve.

A detailed discussion took place on the business rate tariffs for the Council’s premises, the Westgate Centre and local businesses. The Panel were concerned that the Valuation Office Agency had a backlog of valuation requests and appeals spanning several year in some cases. This could mean that some organisations were paying higher tariffs than was appropriate.

However, the Panel noted that the Valuation Office Agency had their own resourcing constraints, and the Council did not have any influence over this. In response to questions, the Head of Financial Services clarified that businesses can apply for a hardship fund and discretionary rate relief where certain criteria can be met. The officer pointed out that the timing of the fund’s dispersion rate over time was the opposite of what was needed in practice, and that the procedure for securing relief was cumbersome, causing the Council to deal directly with applicants to secure prompt action.

The Panel noted that the cost of benefit payments had an adverse variance of £0.558m at the end of 2017/18 which had arisen due to local authority error and admin delays above the upper threshold at which subsidy was not payable. The Head of Financial Services said that approximately 60% of overpayments were recovered, and the remaining was written off after 6 years due to statutory limits. It was highlighted that an ongoing audit may reveal further overpayments.

The Chair asked the Panel to note that 69% of the Council’s planned capital budget in 2017/18 was spent and requested analysis of the lessons from the shortfall.

The Panel said that the Formal Risk Summary contained within the report implied that some issues were a higher risk after mitigation measures had been put in place, which should not be the case. They advised that officers review this document to ensure it was accurate, and suggested that current and residual risk measures were more useful than current and gross, which was calculated before mitigation, whereas residual risk reflected mitigation measures about to be applied.