Nigel Kennedy, Head of Financial Services and Anna Winship, Management Accountancy Manager, will be attending to present the Integrated Performance Report for Quarter 3. The Panel is asked to consider the report and make any recommendations to Cabinet accordingly.

This report will be issued as a supplement.

Nigel Kennedy, Head of Financial Services, and Anna Winship, Management Accountancy Manager, presented the Integrated Q3 Performance report to the Panel.

Regarding the financial position of the General Fund the outturn position was forecast to be a favourable variance of £0.039 million against the latest net budget of £23.205 million (0.17%). The key variances were identified as

-       Housing Services - £0.485 million – £335k of this adverse variance is due to unbudgeted expenditure relating to surveys for the Town Hall, Asbestos and Health and Safety and works to the Town hall ceilings, with £150k of the adverse variance relating to a pressure on the reactive maintenance budget

-       Business Improvement – whilst no overall variance,  ICT was identified as having a c£100k favourable variance, in the main due to a refund on telephony charges and establishment savings, partially offset by an adverse variance of a similar level due to additional spend on equalities and additional consultancy work

-       Law & Governance - £0.064 million - adverse variance due to a pressure in the Directors salary budget and within Electoral registration budget these are offset by unbudgeted SLA income due to be received from work undertaken for the Housing Company.

-       Oxford Direct Services - £0.060 million – adverse variance due to savings predicated on the development of the Recycling Transfer Station not materialising in year due to the scheme not yet being implemented which is partly offset by additional car parking income. It was clarified that the Recycling Transfer Station would be subsumed into the wider depot rationalisation plans which would not come forward until next year. This action will result in savings from the transfer station project not being realised until next year. The level of additional car parking income was anticipated to be approximately £100k, largely based on penalty income.

-       Transfer to /from Earmarked Reserves - £0.335 million – use of the General Fund Repairs and Maintenance reserve to cover the expenditure relating to Town Hall surveys and works.

-       Interest Payable/Receivable - £0.393 million – favourable variance due to increased returns on investments and less interest payable on external borrowing arising from slippage in the Councils capital programme. It was clarified that this meant an interest saving had been made due to delays to projects meaning budgeted external borrowing was not, therefore, required.

The Housing Revenue Account was reported as having a surplus of £1.205 million and the outturn position forecasting a favourable variance of £280k against this. The key variances were identified as follows:

·         Dwelling Rent - £340k favourable variance due to lower than expected RTB sales and more properties than expected moving to formulae rents since the budget was set;

·         Service Charges - £650k favourable variance due to tenant service charge income continuing to be higher than that budgeted (£270k), and leaseholder service charge income which is due to more leaseholders and recharges for major works, which are a one off increase in income (£380k);

·         Garage income - £30k favourable variance due to an increase in the charge which had not been reflected in the budget. The Council was also reported to have been successful in reducing voids in garage usage.

·         Miscellaneous income – £90k favourable variance due to higher than anticipated income for telecommunications;

·         Management & Services - £176k adverse variance due to increase caretaking costs and some additional temporary staff to cover long term absences within the team;

·         Other revenue spend - £512k adverse variance due to a pressure caused by increased legal costs , feasibility costs for phase 2 of the OCHL development programme, decant costs associated with the ongoing developments and consultancy fees relating to the implementation of a new QL Housing system. It was clarified that the cost of feasibility studies, and indeed all the variances references, had been taken into account in the new budget.

·         Responsive & cyclical repairs – £203k adverse variance due to security at the Tower blocks that was put in place until the beginning of June;

The Capital budget was summarised as follows.  A revised budget was approved at Cabinet on the 19 December 2019, and it stands at £59.962 million.  The latest forecast outturn is £47.100 million, this represents a favourable variance of £13.035 million. Clarification was sought and confirmation given that the Council had originally budgeted to spend £101.5m, but had reduced that budgeted spend to £59.96m, on which they were expecting to spend £47.1m – leaving £13.04m of budgeted capital expenditure unspent. This expected spend was confirmed to be less than in the previous financial year, where approximately £60m of capital expenditure was incurred.  Notable contributors to this situation were highlighted as the following:

·         Seacourt Park and Ride Extension - £2.049 million re-timetabled into next year due to the project being at standstill due to adverse weather. It is was reported that contractors were expected to be back on site in March. The Panel sought confirmation over whether the delay means cost increases. To date, none had been incurred but it was likely that there would indeed be cost increases relating to the delays and which would be the subject of a further report to Cabinet.

·         Housing Company loans - £5.231 million re-timetabled – Three of the largest development schemes that began this year had experienced delays due to ongoing re-profiling issues following contractor appointment.  Seven of the nine extension/new build schemes planned to start at the end of the current financial year had been deferred to 2020/21 (£1.731 million) due to resourcing issues that were now resolved, as has the Elsfield/Cumberlege new build scheme (£1.678 million).  There is also slippage in schemes at Rosehill of £0.778 million (groundworks have taken longer than anticipated due to poor local ground conditions), £0.325 million associated with the Harts Close scheme had been deferred due to requiring a revised planning application as a result of costing enquiries and Bracegirdle was reported to be experiencing £0.719 million of re-profiling following the appointment of ODS. 

The Panel sought and were given clarification that the retimetabling of Housing Company loans were down to project delays. Frustration was expressed at the nature of the issues causing the delays, including footpath redirection and groundworks, and the failure to pre-identify them as causes.

·         Motor Transport – Vehicle/Plant Replacement Programme - £1.854 million re-timetabled due to lead in times for vehicles, particularly Electrical Vehcles, having increased with delivery being in 2020/21;

·         Within the HRA, delays to the insulation programme for properties had occurred due to low resident take up. The Panel were informed that this was already known as an issue by Housing Services and remedial action was being taken to increase the take-up rate.

Regarding performance management, 46% (6) of the Council’s corporate performance targets were reported as being delivered as planned, 23% (3) showing as below target but within acceptable tolerance limits, and 8% (1) currently at risk. This latter measure was identified as the number of people from the Council’s target groups using the Council’s leisure facilities, though this was recognised to be an area where the public were not always willing to share the necessary data.

In terms of corporate risk, the only red risk identified was over housing delivery. The Panel asked about the Council’s performance relating to the Oxfordshire Growth Deal. It was confirmed that the Council is presently delivering its share of the Growth Deal housing, and was in a better place than other Districts in this respect. However, it was suggested that the overall delivery of the Growth Deal may be a challenge, but that would not have a significant impact on the Council as it would still be able to draw down its element of the funding for delivery of affordable housing.