Agenda Item No
The Vale of Glamorgan Council
Scrutiny Committee (Economy and Environment): 9th October 2012
Joint Report of the Director of Development Services and the Director of Visible Services and Housing
Revenue and Capital Monitoring for the period 1st April 2012 to 31st August 2012
Purpose of the Report
1. To bring to the attention of this Scrutiny Committee, the position in respect of revenue and capital expenditure for the period 1st April 2012 to 31st August 2012 regarding those revenue and capital budgets, which form this Committee’s remit.
2. To request a change to the Capital Programme.
It is recommended that:
1. the position with regard to the 2012/13 revenue and capital monitoring is noted
2. Cabinet be requested to approve a virement from the Policy Budget to Economic Development and Leisure of £333,000.
3. the proposed amendment to transfer £17K from NCN88 to the Pont y Werin capital scheme and to also increase the Pont y Werin scheme by a further £6k, funded from SEWTA grant, is endorsed and referred to Cabinet for approval.
Reasons for the Recommendations
1. That Scrutiny Members are aware of the position with regard to the 2012/13 revenue and capital monitoring.
2. To fund savings not achieved due to delay in transfer of leisure centres.
3. That Scrutiny and Cabinet approves the proposed amendment to the Capital Programme.
3. Council on the 7th March 2012 (minute no 951 and 950 respectively) approved the Revenue and Capital Budgets for 2012/13. Reports monitoring expenditure are brought to this Committee on a regular basis.
Relevant Issues and Options
4. The Revenue Budget and projected outturn for 2012/2013 are shown in Appendix 1.
5. Highways Maintenance & Engineering Design & Procurement - There is currently a £26k adverse variance to the profiled budget. This is mainly due to a slight overspend on employee costs. The budget for 2012/13 takes account of the efficiency savings required. The budget will be monitored closely to ensure these savings are met and it is expected that the budget will outturn on target.
6. Waste Management - There is currently a £89k favourable variance to the profiled budget. The current underspend is mainly due to tonnages to landfill dropping as the food waste and co-mingled recycling programmes increase in popularity therefore saving on costly landfill disposal. The budget for 2012/13 takes account of the efficiency savings required. The budget is currently expected to outturn on target
7. Grounds Maintenance - There is currently a £63k adverse variance to the profiled budget. This is mainly due to an overspend on new machinery as new legislation has come in to force for Hand Arm Vibration. The budget for 2012/13 takes account of the efficiency savings required. The budget will be monitored closely to ensure these savings are met and the budget outturns on target.
8. Support – There is currently a favourable variance of £48k to the profiled budget. This budget is to be held for any cost pressures within Visible Services that may arise throughout the financial year. Currently this budget is also projected to outturn on target.
9. Building Services - It is currently anticipated that this area will breakeven at year end.
10. Economic Development and Leisure - The leisure partnership agreement was finalised on 1st August consequently there is a shortfall in achieving the £1m efficiency savings target set for the year which equates to £333,000 in 4 months. The budget for Economic Development and Leisure needs to be increased to reflect this change which will be compensated by a corresponding reduction in the Policy budget. This amendment has been reflected in Appendix 1.
11. After the above, there is an adverse variance on Leisure Services of £255,000. Part of this is due to timing issues whereby some staff costs, such as those paid on timesheets, are paid a month in arrears and therefore when the centres transferred an additional month was paid (£55k). Also income received via direct debits on a monthly basis partly covered a period in advance for a future month and likewise an adjustment has to be made to reduce income at the point of transfer (£95k). This leaves an overspend of £105k arising as a result of the general uncertainty prior to the start of the contract, leading to a reduction in income, an increase in staff costs and additional work undertaken due to the transfer. The figures shown are based on Leisure Services estimates and further work will be undertaken to clarify the position and therefore the funding for the adverse variance will be addressed in the revised estimates report to Cabinet in November 2012.
12. There is an adverse variance of £92k on Lifelong Learning Education and Training Services as a result of the receipts from the Government Work Programme not achieving the target to date and this is currently under review in order to achieve outturn within budget by year end.
13. Planning and Transportation - There is currently a £137k favourable variance to the profiled budget. This is predominately due to income from planning fees for major schemes now being in advance of profiled estimate. The timing of their receipt will impact on the budget variance. It is anticipated that the division will outturn on budget.
14. Appendix 2 details financial progress on the Capital Programme as at 31st August 2012.
15. For all schemes where it is evident that the full year's budget will not be spent during the year, the relevant officers are required to provide an explanation for the shortfall and this shall be taken to the earliest available Cabinet.
16. Structural Repairs of Eastern Shelter Public Convenience Block - Cabinet (29th February 2012) approved the inclusion of a successful capital bid for £55k in both 2012/13 and 2013/14 for structural repairs to the public convenience block behind Barry Island's Eastern Shelter. Officers have reported incidents of structural failure of the concrete structure of the Eastern Shelter, with sections of the concrete breaking up. There is now a serious concern that the Eastern Shelter needs structural repairs and that unless works are undertaken soon it will be a risk to public safety. Areas underneath the shelter have been cordoned off in order to reduce the risk of injury. As the shelter is a listed building WG must give Listed Buildings Consent (LBC) before works proceed. There are certain exceptional circumstances whereby works can proceed ahead of LBC, such as 'in the interests of safety or health or for the preservation of the building' and it is intended that works would proceed on this basis. A request for LBC will nevertheless be made, albeit retrospectively, once a structural survey is completed. Emergency powers have been exercised to approve the reallocation of all £55k of the 2012/13 capital budget for an immediate structural survey, to be carried out by structural consultants (estimated at £30k), and the urgent works to the shelter. In addition, a further £30k will be needed from the 2013/14 allocation for these works and approval has also now been given for this sum to be brought forward from the 2013/14 budget into the 2012/13 Capital Programme. This is reflected in Appendix 2. It is proposed that the public convenience block will be addressed as part of the regeneration of Barry Island and will be included in discussions with Regeneration Officers at the Welsh Government.
17. Pont y Werin and NCN88 - South East Wales Transportation Alliance (SEWTA) have approved the transfer of £17k grant from the National Cycle Network route 88 budget to the Pont y Werin cycleway budget as well as awarding an additional £6k grant for the Oystercatcher element of the Pont y Werin scheme in order to reflect the true expenditure anticipated on this project. Cabinet will be asked to amend the capital budgets on these two schemes to reflect these approved changes.
18. Rights of Way Improvement Plan (ROWIP) - Cabinet on 9th July 2012 (minute C1780) approved the inclusion of a Countryside Commission for Wales (CCW) capital grant towards various improvements to the rights of way network into the Council's Capital Programme. The actual allocation from CCW came in higher than anticipated, at £39k. This sum is now included in Appendix 2.
19. Gibbonsdown Community Centre - Under delegated authority, officers have approved the transfer of some £13k from the Barry Regeneration Partnership capital budget towards developing design and tender papers for this project to refurbish the community centre building. The scheme is anticipated to be funded from two separate Welsh Government grants: the Barry Regeneration Area (BRA) the Flying Start capital grant. Neither grant offer has formerly been received by the Council as yet, though the BRA grant has initially been approved for the Gibbonsdown Childrens Centre who originally applied for the grant. WG have advised that they will be happy to transfer the offer from the Children's Centre to the Council though this has not taken place as yet. A Flying Start grant offer is not expected until October. Tenders are due back at the end of October, by which time available funding for the scheme will be known.
Variance between Actual Spend to date and Profiled Spend
20. Cabinet have previously agreed that further information would be provided where schemes have a value of over £500k and show a variance of 20% or more between actual spend and the profile. The following schemes meets this criteria:-
21. Coldbrook Flood Risk Management - Detailed design has now been completed on this major flooding scheme but contractor appointment has been delayed. Highway Officers advise that the programme has slowed due to problems with obtaining consent from the Environment Agency to undertake works on Main River. At this stage a full spend is anticipated though Members will be advised if it becomes evident that this is no longer viable.
22. Highway Resurfacing (Local Government Borrowing Initiative) - Expenditure is behind budget as although works are progressing well on site, smaller sites have been completed earlier than planned which has reduced costs to date. Weather permitting, a full spend is still anticipated.
23. Vehicle Renewals - In a similar manner to last year, the Council's Fleet Manager is reporting lengthy delays with delivery of newly procured vehicles which has meant that expenditure is not keeping in line with the planned profile. Build times on some of the vehicles is far greater than anticipated
24. Appendix 3 provides non-financial information on capital construction schemes with a budget of over £100,000. Where a budget shown in Appendix 2 is more than £100,000 but is made up of several smaller schemes that individually are less than £100,000, the scheme is not included in Appendix 3.
Resource Implications (Financial and Employment)
25. As detailed in the body of the report.
Sustainability and Climate Change Implications
26. One of the purposes of the Sustainable Development Working Group is to review the sustainability of major capital schemes. Wherever possible, the Council strives to reduce carbon emissions and improve energy efficiency and positively encourages waste reduction initiatives.
Legal Implications (to Include Human Rights Implications)
27. There are no legal implications.
Crime and Disorder Implications
28. There are no crime and disorder implications.
Equal Opportunities Implications (to include Welsh Language issues)
29. There are no equal opportunity implications.
30. Effective monitoring assists in the provision of accurate and timely information to officers and Members and in particular allows services to better manage their resources.
Policy Framework and Budget
31. The report is in accordance with the Policy Framework and Budget.
Consultation (including Ward Member Consultation)
32. The appropriate Chief Officer has been consulted. This report does not require Ward Member consultation.
Carolyn Michael (Senior Group Accountant) (01446 709778)
Director of Development Services
Director of Visible Services and Housing