Agenda item

The Portfolio Holder for Finance will attend the meeting in order to be held to account for matters within the remit of this committee. 

Discussion:

The Portfolio Holder for Finance, Councillor Jarrett, gave a presentation to the committee which included:

      Procurement

·        The Procurement Board had met 16 times during the past year and considered 118 contracts with a total of £230 million

·        Scrutiny of contracts was becoming increasing severe and testing to ensure value for money

·        The Council was moving towards a ‘Category Management’ form of procurement which, once set up, would deliver better contracts and service delivery.

Asset and Property Management

·        In 2010/11 the Council sold 29 properties valuing £4.1 million
In 2011/12, 26 properties were sold valuing £2.6 million and a further four properties were due to be sold with a value of £700,000. This helped to fund capital priorities with a beneficial effect on the backlog of maintenance which had reduced from £34 million to the current £16 million

·        Work had commenced on Rochester Riverside

·        Terms were being agreed with Tesco for a new store in Strood which would enable a new library offer in Strood with a community hub

·        26 out of 27 council-owned business start-up units were currently let and the property team had been commissioned as property advisors by Kent Fire and Rescue Service

·        on-going energy savings work which included £2.7 million spent on mercury abatement work at Medway Crematorium, which would drive down utility costs.

Risk Register

·        Risk was now embedded across the organisation and in service delivery and contracts.

Communications

·        The Council had been awarded a 3* rating for its website which was well used, with 100,000 new visitors per month during the last quarter

·        Medway Matters magazine was produced six times a year which was a vital means of communicating with residents. It was greatly enhanced with the unified events guide which would now be included in every edition

·        Current campaigns included: Love Medway app and Stop the Estuary Airport.

Better for Less

·        Phase 1 was underway and would deliver budget savings and an enhanced service

·        The Council sought to minimise the number of staff leaving due to this project and to date there had been one compulsory redundancy. Affected staff had been moved to vacant posts which saved money on redundancy costs and minimised the disruption to employee’s lives.

Finance

·        The Council had set a balanced budget over the past few years and delivered on it, despite difficulties caused by the government’s Comprehensive Spending Review, with greater challenges to face in the next few years

·        The whole Council worked hard to bring in a balanced budget, and in some cases, an underspend

·        budget assumptions were made on demographic growth which was a volatile measure but in spite of this, the assumptions made have been sound, as the budgets have been balanced at the end of the financial year

·        There was two years remaining of the Comprehensive Spending Review (CSR) with further grant reductions and the consequences of the Council Tax freeze for 2012/2013

·        There was to be a government ‘Resource Distribution Review’ (which included the re-distribution of business rates) but this would not happen until 2013/2014.

The committee made various comments and asked questions, including:

·        with reference to an open letter sent by North Kent businesses to the Council, Members commented on people objecting to Medway’s stand over the possible airport in the Thames estuary when they did not live in Medway

Councillor Jarrett agreed and advised that he was discussing with officers how to respond to this letter.

·        changes to housing benefit might see landlords having problems getting their rents

Councillor Jarrett advised Members that the change to housing benefit would inform the current review of the Supporting People service which the Council was looking to reduce from £4.6 million by £2 million.

·        a Member had received information that there had been problems accessing the e-petition facility on the Council’s website.

Councillor Jarrett advised that he would ask officers to investigate this.

·        The information given by Councillor Jarrett about the procurement process had demonstrated what a huge part of the Council’s finances it controlled and how complex the process was. It was suggested that Members were offered training about the Procurement process at a time when the Category Management system would be going live

The Portfolio Holder agreed that he would ask officers to offer training on this at the appropriate time.

·        The government’s budget for 2012/2013, announced earlier today, included Council Tax benefit for service personnel to be increased from 50% to 100%. Would the Council be compensated for providing that additional benefit?

Councillor Jarrett responded that he understood that the Council would fund the cost of this additional Council Tax benefit.

·        How had the Council achieved the turn-around of £5 million forecast overspend in quarter 2 monitoring reports to a forecast balanced budget in quarter three?

Councillor Jarrett reminded the Committee that social care services remained the main area of volatility as far as the budget was concerned. For 2011/2012 there had been over-provision in the budget which meant that those in need were provided for but this demand had not materialised in every case yielding a beneficial budget position. This had also been achieved by senior officers managing their budgets sensibly and a moratorium on all spending had yielded savings but with no diminution of service.

·        The government’s consultation date for the proposed airport in the Thames estuary had changed from 13 March to be scheduled during summer 2012. Was this delay welcomed?

Councillor Jarrett responded that it was good in some ways but certainly not for lengthening the uncertainty for residents in the area. He advised that he had written to the Head of the Civil Service about launching a consultation during the purdah period for the elections for the Mayor of London and this seemed to be a reason for delaying the consultation.

·        What had the Cabinet learnt from the experience surrounding the delay and extra costs of the dynamic bus facility in Chatham?

Councillor Jarrett responded that he had already given a commitment to publish the full spending costs for the bus facility. He added that in the Medway Renaissance Legacy Pack, dated 25 February 2011, it stated that the dynamic bus facility and the changes to various roads were on programme and on budget. The Cabinet had learnt a lot from this matter and he had referred to this in his presentation about Procurement contracts – that they were now let in a more robust way and were better managed.

·        What preparations were in place for the national changes to universal credit and Council Tax, where it was expected that a number of families who were unable to continue to afford to live in their current homes (particularly in London) would look for a cheaper area to live in?

Councillor Jarrett replied that there had been a large increase in the numbers requiring the Council’s statutory obligations around Special Educational Needs (SEN) and this was being addressed in the emerging strategy. The increase in demand had been caused through inward migration, with many families moving to Medway from London. This did have to be addressed and the Council would review the criteria more frequently and robustly and may have to adopt a more stringent policy.

·        Following a recommendation from the Audit Committee in 2011, was the Council working towards setting up a one-stop shop fraud hotline?

Councillor Jarrett responded that PKF (the Council’s auditors) had produced a report which led the Cabinet to believe that some of the Council’s systems were not as robust as had previously been believed. He accepted that work was required to rectify this and he assured Members that the problem was recognised and he was working on this issue.

·        The government had announced it was going ahead with National Planning Policy Framework (NPPF), which may put Capstone Valley under threat as a greenspace facility. What was the Portfolio Holder’s view on this?

Councillor Jarrett responded that this was a great worry. The Localism Act gave general powers to local neighbourhoods but most neighbourhoods did not want large developments and the Council had to be robust in fighting any proposals to develop the Capstone Valley and also the peninsula. He wanted to communicate the possibilities and full consequences to the wider public and one way to do this was to explain the threat of housing and loss of greenspace.

·        Recently Medway had not achieved City Status, what did the Portfolio Holder think had damaged the bid and had there been any positive points from the campaign to help the council in the future?

The Portfolio Holder responded that the council had run a high-profile campaign at a cost of £13,000, whereas a full marketing campaign would have been extremely expensive. The positive outcomes from the campaign included that Medway was now more widely identified as a place in its own right (rather than five towns), it was much more recognised in central government and through the regeneration projects even more widely recognised. This will help the council’s on-going work to lever investment and encourage businesses into Medway.

Decision:

The Portfolio Holder was thanked for his presentation and the responses he had given.