Agenda and minutes

(Director of Governance) To declare interests in any item on this agenda.

The Cabinet Committee noted that Councillor G Waller substituted for Councillor J Philip.

To confirm the minutes of the last meeting of the Committee held on  20 July 2015 (previously circulated at Cabinet on 3 September 2015).

Resolved:

(1)          That the minutes of the meeting held on 20 July be taken as read and signed by the Chairman as a correct record.

(Director of Communities) To consider the attached report (FPM-008-2015/16).

The Director of Communities presented a report on the Housing Revenue Account (HRA) Financial Plan and future options resulting from the Government’s required rent reductions of 1% per annum by all social landlords for the next four years, as an alternative to the previous guidance of CPI+ 1% for rent increases. This had resulted in an estimated loss in rental income to the Council’s HRA of around £14million over the next four year period and around £228million over the next 30 years. In view of the significant reduction, the Director of Communities commissioned Simon Smith, the Council’s HRA Business Planning Consultant from CIH Consultancy to provide a report on the options available to the Council, to ensure that the HRA did not fall into deficit.

Mr Smith gave a presentation on the estimated loss in rental income to the Council’s HRA compared to the Council’s current HRA Financial Plan expectations and options available to the Council to consider, which were;

·         Ceasing all or some of the funding currently available within the Financial Plan for future housing improvements and service enhancements for HRA services;

·         Reducing investment in improvements to the Council’s housing stock (and reducing the Council’s Modern Home Standard accordingly);

·         Reducing/ceasing the Council’s own Housebuilding Programme;

·         Further borrowing for the HRA, repaid by the end of the Financial Plan period;

·         Combinations of the above.

Mr Smith advised that no immediate corrective action was required at present but that a further review of the HRA Financial Plan should be undertaken again in 2016, when further details were available and information about the Government’s requirements for local authorities to sell their “high value” void properties was known. It was also advised that with a few exceptions, most of the uncommitted funding within the HRA’s Housing Improvements and Service Enhancements Fund for 2016/17 was not spent at present.

The Cabinet Committee agreed with CIH Consultancy’s view that the details of the Housing Bill were required before decisions could be made on the future direction of the Financial Plan, because of the unknown details surrounding the Government’s  “High Value” void policy, which could result in a high proportion of the Council’s housing stock having to be sold on the open market. The Director of Communities advised that he understood that the CLG was currently considering the possibility of a financial levy being placed on local authorities rather than requiring them to sell specific “high value” voids. He commented that, if this was the outcome, it may be a better one for the Council, bearing in mind the high property values in the District, compared to the rest of the Region.

There was a discussion on whether or not the Council should continue with its Housebuilding Programme, in order to reduce, or avoid the need for additional borrowing. Mr Smith advised that if the Programme was reduced in the early years, not only would the Council have to pass money to the Government (estimated to be in the region of £7.329million), in addition, the return  ...  view the full minutes text for item 19.

(Senior Performance Management Officer) To consider the attached report (FPM-009-2015/16).

The Director of Resources presented a report on the Key Performance Indicators 2015/16 for Quarter 1’s Performance.

The Council was required to make arrangements to secure continuous improvement in the way in which its functions and services were exercised, having regard to a combination of economy, efficiency and effectiveness. As part of the duty to secure continuous improvement, thirty-six Key Performance Indicators (KPI) relevant to the Council’s service priorities and key objectives, had been adopted. Performance against all of the KPIs was reviewed on a quarterly basis by the relevant Select Committees.

The overall position with regard to the achievement of the target performance for KPIs at the end of the first quarter (30 June 2015) was that 22 (61%) indicators had achieved their targets, 14 (39%) had not achieved their targets, although 3 (8%) were within agreed tolerance and 27 (75%) of the indicators were anticipated to achieve the cumulative year-end target.

Resolved:

(1)          That the Outturn Performance for Key Performance Indicators Quarter 1 for 2015/16 be noted.

Reasons for Decision:

The KPIs provide an opportunity for the Council to focus attention on how specific areas for improvement would be addressed, and how opportunities would be exploited and better outcomes delivered.

It was important that relevant performance management processes were in place to review and monitor performance against the key objectives, to ensure their continued achievability and relevance, and to identify proposals for appropriate corrective action in areas of slippage or under performance.

Other Options Considered and Rejected:

No other options were appropriate in this respect. Failure to review and monitor performance could mean that opportunities for improvement were lost and might of had negative implications for judgements made about the progress of the Council.

(Director of Resources) To consider the attached report (FPM-010-2015/16).

The Principal Accountant presented a report on the Annual Outturn Report on the Treasury Management and Prudential Indicators 2014/15.

The Principal Accountant reported that the annual treasury report was a requirement of the Council’s reporting procedures, covered the treasury activity for 2014/15 and the actual Prudential Indicators for 2014/15. During the year the Council had financed all of its capital activity through capital receipts, capital grants and revenue contributions and there had been no additional borrowing in the year to add to the £185.456m taken out previously through the Public Works Loan Board (PWLB) to finance the payment in relation to the self-financing of the HRA.  The Council had achieved its targets for its treasury and prudential indicators and the report and the appendices would be considered by the Audit and Governance Committee on 21 September 2015.

Resolved:

(1)        That the 2014/15 outturn for Prudential Indicators shown within the appendices be noted; and

(2)                  That the Treasury Management Outturn Report for 2014/15 be noted.

Reasons for Decision:

The report was presented for noting as scrutiny was provided by the Audit and Governance Committee who make recommendations on amending the documents, if necessary.

Other Options Considered and Rejected:

Members could ask for additional information about the CIPFA Codes or the Prudential Indicators.

(Director of Resources) To consider the attached report (FPM-011-2015/16).

The Director of Resources presented report on Invest to Save Proposals for additional grass cutting equipment, LED lighting in car parks and the consideration of other proposals being developed.

The Director of Resources reported that in setting the budget for 2015/16, the Cabinet had decided that as the balance on the General Fund Reserve exceeded the minimum requirement and further savings were required, a £0.5 million should be transferred from the General Fund Reserve into an Invest to Save earmarked reserve. It was intended that this earmarked reserve would be used to finance schemes that would reduce the Continuing Services Budget (CSB) in future years. Management Board had received two proposals, so far and business cases were being developed for several other suggestions. It had been appropriate at this stage to seek Member approval for the proposals and give the Members an opportunity to put forward additional or alternative proposals.

The Cabinet Committee were pleased with the proactive approach of Officers coming forward with ideas and the evaluation process of Management Board considering items before they were presented to the Cabinet Committee.

Councillor Stavrou suggested that a pool of hybrid vans could be considered for the Housing department.

Councillor Stallan praised the proposal for Hill house, Waltham Abbey and how this could be regenerated for the benefit of the residents with partners working together on the site, if the proposal stacked up.

The Director of Neighbourhoods advised that after market testing the external specialists for the off street parking was approximately £15,000, which would provide the expertise, capacity and resources to progress the business case and provide further detail on the costs and benefits.

Councillor J M Whitehouse suggested that when the carpark at St John’s Primary School was acquired by the Council, that cars with business permits for Bakers Street Carpark could be moved to this site, whilst the development was being progressed.

The Director of Communities advised that officers were currently working up a business case for additional funding being provided for rental loans to homeless single people, to avoid the use of bed and breakfast accommodation, thereby saving the significant loss in housing benefit subsidy as a result.

The Cabinet Committee concluded that they would look to receive all suggestions with enthusiasm.

Recommended:

(1)          That  the proposals to invest in additional grass cutting equipment and LED lighting in the car parks be recommended to Cabinet;

(2)          That the proposals currently being developed be supported in principle, which included;

(i)            Replacement of the cash taking facilities with Cash Kiosks within the District;

(ii)           Taking Off Street Parking back in house;

(iii)          Master Planning exercise for the redevelopment of Hill House Site, Waltham Abbey for co-location of services; and

(iv)         Provision of additional rental loans to homeless single people, to avoid the use of bed and breakfast accommodation.

(3)          That the proposals suggested for a pool of hybrid vans for the Housing department be investigated; and

(4)           That when the carpark at St John’s Primary School was acquired by  ...  view the full minutes text for item 22.

(Director of Resources) To consider the attached report (FPM-012-2015/16).

The Director of Resources advised the Cabinet Committee that the Corporate Risk Register had recently been reviewed by both the Risk Management Group on 27 August 2015 and Management Board on 2 September 2015 and a number of amendments had been identified and incorporated into the register which included;

1.    Risk 1 Local Plan

Key dates within the Action Plan had been updated to advise the current status, which included the confirmation that the new staffing structure had been implemented.

2.    Risk 2 Strategic Sites

The Effectiveness of controls/actions had been amended to advise the updated position for the key sites.

3.    Risk 4 Finance Income

The Key date had been amended to Autumn, when the outcome of the Comprehensive Spending Review would be available.

4.    Risk 5 Economic Development

Recruitment of experienced staff had been removed from the required further management action as staff were now in post. The key date had been revised to January 2016 for the completion of the Economic Development Strategy.

5.    Risk 6 Data / Information

The required further management action had been amended to advise the required implementation of a new system for handling Freedom of Information requests. The suitability to extend the use of the system for Data Protection would be considered after a further six months.

6.    Risk 7 Business Continuity

The required further management action had been amended to include the need to arrange periodic testing and exercises.

7.    Risk 8 Partnerships

The Existing Control had been updated to advise the structured reporting was to Select Committee rather than Scrutiny Panels.

8.    Risk 9 Safeguarding

An additional Existing Control and required further management action had been added to advise the establishment of a Nursery Worker Accommodation Task Group and the need for an action plan for the group. Also within the existing Controls it was noted that the Safeguarding Strategy and Action Plan was adopted by Cabinet. An additional required further management action had been added to reflect the Cabinet decision to support a growth bid to make the Safeguarding posts permanent.

9.    Risk 10 Housing Capital Finance

An additional Vulnerability and Trigger had been added should there be any legislative change which reduced income to the Housing Revenue Account (HRA).

Resolved:

(1)          That the Key dates within the Action Plan for Risk 1, Local Plan be updated;

(2)          That the Effectiveness of controls/actions for Risk 2, Strategic Sites be updated;

(3)          That the Key date for Risk 4, Finance Income be amended;

(4)          That the Required further management action and updated Key Date for Risk 5, Economic Development be amended;

(5)          That the Required further management action for Risk 6, Data/Information be amended;

(6)          That the Required further management action for Risk 7, Business Continuity be amended;

(7)          That the Existing Control within Risk 8, Partnerships be amended;

(8)          That the Existing Control and Required Further Management Action for Risk 9, Safeguarding be updated;

(9)          That the Vulnerability and Trigger within Risk 10, Housing Capital Finance be added;

(10)  ...  view the full minutes text for item 23.

(Director of Resources) To consider the attached report (FPM-013-2015/16).

The Assistant Director, Accountancy presented the quarterly financial monitoring report for 1 April 2015 to 30 June 2015, which provided a comparison between the original profiled budgets for the quarter and actual expenditure or income. The report provided details of the revenue budgets, the Continuing Services Budget and District Development Fund as well as the capital budgets which included the Major capital Schemes.

The Cabinet Committee were advised that all directorates were either in line with the budget at the end of the first quarter, or were underspent. The Assistant Director, Accountancy reported that several of the Council’s key income streams, including Development Control, Building Control, Licensing, MOT’s carried out by Fleet Operations, had all performed particularly well in the first quarter of the year. The Car Parking Income and Local Land charges were both below estimates and would be monitored. The Business rates had increased but were only expected to be temporary because of the outstanding appeals and cash collection was going well.

Councillor Stallan advised that an issue had been raised about turning away vehicles for MOT’s. The Director of Neighbourhoods advised that it would be looked into, as nothing had been reported directly to himself.

Recommendations/Decisions Required:

(1)          That the revenue and capital financial monitoring report for the first quarter of 2015/16, be noted.

Reasons for Decisions:

To note the first quarter financial monitoring report for 2015/16.

Other Options Considered and Rejected:

No other options available.

(Director of Resources) To consider the attached report (FPM-014-2015/16).

The Director of Resources presented a report regarding the key issues arising from the annual Governance Report for 2014/15. The International Standard on Auditing 260 required the External Auditor to report to those charged with governance on certain matters before giving an opinion on the Statutory Statement of Accounts.  The External Auditor had indicated that their audit of the Council’s Statutory Statement of Accounts for 2014/15 would be presented to the Audit and Governance Committee on 21 September 2015.

The report highlighted the significant findings of the audit of the financial statements of the Council for the year ending 31 March 2015, and the Director of Resources advised the Cabinet Committee of the following key findings arising from the audit:

(a)          A material misstatement relating to incorrect data input into the Asset Management System, which the balance on the Revaluation Reserve was overstated by £6,554,747 and the balance on the Capital Adjustment Account understated by the same account;

(b)          There was one unadjusted audit difference which increased the draft surplus on the provision of services in the comprehensive income and expenditure account by £88,000 to £15.863 million (from£15.775);

(c)          Subject to satisfactory completion of the outstanding work, it was anticipated that an unqualified true and fair opinion would be issued on the financial statement for the year;

(d)          No significant deficiencies in internal controls had been identified;

(e)          The Annual Governance statement was not misleading or inconsistent with other information and complied  with the ‘Delivering Good Governance in Local Government criteria;

(f)           The Whole of Government Accounts (WGA) element was below the threshold for a full assurance review and no further work was required other than to submit the section on the WGA Assurance Statement to the WGA audit team with the total values for assets, liabilities, income and expenditure; and

(g)          The auditors were satisfied in all significant respects that the Council had put in place proper arrangements to secure economy, efficiency and effectiveness in the Council’s use of resources, and proposed to issue an unqualified value for money conclusion.

The Director of Resources advised that valuations of the Council’s leisure centres, which had been performed by the Council’s internal valuer, had been significantly higher than expected and the working papers that supported the valuation had not been located. Therefore the auditors had requested that the Council revisited the valuations and include supported working papers. The Council’s Estates and Valuation team had provided an indicative opinion on the value of the assets but were unable to provide a formal valuation because of a lack of experience valuing this type of asset. The valuation had been received and reduced from approximately £27 million to £12.5 million, although this would not effect the level of Council Tax or make any changes to the Medium Term Finance Strategy and accounts should be signed off shortly.

Resolved:

(1)          That the External Auditor’s Annual Governance Report be noted.

Reasons for Proposed Decisions:

To ensure that Members were informed of any significant issues  ...  view the full minutes text for item 25.

It was noted that there was no other urgent business for consideration by the Cabinet Committee.

The Cabinet Committee noted that there were no item of business on the agenda that necessitated the exclusion of the public and press from the meeting.