PAPER B

Environment and Transport Select Committee - 22 September 2003

BUDGET MONITORING REPORT AS AT END OF AUGUST 2003

JOINT REPORT OF THE CHIEF FINANCIAL OFFICER AND THE STRATEGIC DIRECTOR OF ENVIRONMENT SERVICES

REASON FOR SELECT COMMITTEE CONSIDERATION

This report sets out the budget and spending position on revenue budgets for the services within this Committee’s remit, and the highways capital programme, as at the end of August 2003. The figures do not include budgets which are controlled elsewhere than the service concerned. These are monitored by the Committee which bears overall responsibility for the costs. (For example, the corporate building maintenance budget is monitored by the Resources Select Committee, hence the costs are not shown against the service budgets in Appendix 1).

ACTION REQUIRED BY THE SELECT COMMITTEE

Members are invited to note the content of the report.

BACKGROUND

REVENUE EXPENDITURE

The report details gross expenditure, income and net expenditure to date against budget as shown at appendix 1. The appendix also shows the current variance, which compares the net budget with the net expenditure to date. In order to provide further information, commitments have been included in a separate column to the expenditure to date figures, and further columns have been added to show percentage expenditure and commitment to date against budget, and also percentage income generated to date against budget. Members will see from the totals on page 2 of the appendix that some £5.4m has been spent to date, whereas current commitments amount to £5.8m; in total 67.6% of the budget is spent and committed at this stage of the financial year. This is not perceived as a problem as the major commitments include the waste management and street cleansing contracts, for which expenditure will effectively replace the commitment as it arises.

Members will be aware from previous budget monitoring reports that the budget strategy of the Council for this year suggested a reduction of £248,000 in the highway maintenance budget. Currently the highway maintenance budget is showing 72.9% spent and committed. These figures include cyclical maintenance contracts such as grass cutting and gully cleaning. However, with the autumn and winter periods imminent, when more reactive requirements for winter maintenance, pothole repairs and safety sweeping may arise, there is a need to monitor both the highway maintenance and traffic management budgets closely as a result of the additional budget pressures which may be caused by the year on year budget reduction.

The budget strategy also included a £500,000 increase in the income target for car parks, which is another area requiring continual monitoring to ensure targets are achieved. At present, car parking income has achieved some 60.1% of the annual

budget and, whilst there will inevitably be a slow down in the winter months due to closure of seasonal areas etc, current indications suggest that the income generated should at least be equivalent to the budget.

Currently, the main area for concern is in the public transport budget where there is a statutory requirement to meet increased costs arising from the Concessionary Fares Age Equalisation scheme. Whilst those costs, estimated to be £80,000 per annum, have been accommodated within the budget, implementation of the new statutory requirement has given rise to a reappraisal of the existing Concessionary Fares scheme and its method of payments. Potential costs are still being assessed, but at this stage it seems likely that there may be a requirement for an additional payment of £120,000 per annum.

CAPITAL EXPENDITURE

Expenditure and commitments against each scheme are shown at appendix 2.

The approved budget for the current financial year is £5,495,000, which is equivalent to the settlement announced by GOSE during December 2002. That budget has now been augmented by carrying forward underspends from the previous year of some £2,100,000. The carry forward budgets are necessary for the completion of schemes already commenced during 2002/03 and in progress at the year end; they are also necessary for commitments made but for which works had not started by 31 March 2003; finally some amounts are required as a result of planned slippage where it was apparent that approved projects would not be commenced prior to 31 March 2003.

A number of the more significant projects included on appendix 2 are now complete or virtually complete in terms of works on the ground. These include the strategic corridors from Newport to both Cowes and East Cowes; the Military Road project; and the Newport to Sandown cycle route. However, the financial transactions for these projects are not yet complete, and the Head of Engineering Services and his project managers are assessing the financial position with regard to outstanding commitments, invoices, retentions and final account requirements, before deciding whether funds are available for transfer to other projects.

RELEVANT PLANS, POLICIES, STRATEGIES AND PERFORMANCE INDICATORS

The services included within this report are linked to a number of the Council’s key strategic objectives, specifically Improving health, housing and the quality of life for all; Creating safe and crime-free communities; Improving public transport and the highways infrastructure; and Protecting the Island’s physical environment.

They are also linked to a number of the Council’s plans, in particular the Local Transport Plan.

There are no direct implications for performance indicators arising from the production of this report. However, clearly there will be implications for future performance measures and indicators arising from the information contained within the report, specifically any cost based indicators, but also the outcomes arising from the services and projects to which this report refers.

CONSULTATION

No specific consultation has been undertaken in the production of this report. However, a number of the capital projects and services included within the report will have been the subject of consultation with a range of external agencies and members of the public.

FINANCIAL, LEGAL, CRIME AND DISORDER IMPLICATIONS

Since this a budget monitoring report, there are a number of financial implications (both revenue and capital) for the Council as a whole, and for the services for which this Committee has responsibility.

There are no direct legal or crime and disorder issues arising from the production of this report.

APPENDICES ATTACHED

Appendix 1 Revenue Expenditure Summary

Appendix 2 Capital Expenditure Summary

BACKGROUND PAPERS USED IN THE PREPARATION OF THIS REPORT

None used in the preparation of this report.

CONTACT POINTS

Due to the diversity of services to which the content of this report relates, there are a considerable number of potential contact points for queries, both financial and operational:

Environment Services

Budget : Stuart Fraser ' 823657 email: [email protected]

Operational : Derek Rowell ' 823146 email: [email protected]

Engineering Services

Budget : Helen Gaches ' 823657 email: [email protected]

Operational : Stephen Matthews ' 823788 email: [email protected]

Coast Protection and Environmental Initiatives

Budget : Annette Gregory ' 823767 email: [email protected]

Operational : Robin McInnes ' 857220 email: [email protected]

Waste Management, Street Cleansing and Public Conveniences

Budget : Stuart Fraser ' 823657 email: [email protected]

Operational : Steve Boswell ' 823732 email: [email protected]

Highway Design

Budget : Helen Gaches ' 823657 email: [email protected]

Operational : Phil Hayward ' 825769 email: [email protected]

Highway Maintenance

Budget : Helen Gaches ' 823657 email: [email protected]

Operational : Nick Gallin ' 823718 email: [email protected]

Traffic Management

Budget : Helen Gaches ' 823657 email: [email protected]

Operational : Peter Taylor ' 825763 email: [email protected]

Street Lighting

Budget : Helen Gaches ' 823657 email: [email protected]

Operational : Geoff Woodhouse ' 565552 email: [email protected]

Public Transport, Central Transport and Cowes Ferry

Budget : Andrew Taylor ' 823656 email: [email protected]

Operational : Andy Morris ' 823780 email: [email protected]

Car Parking

Budget : Annette Gregory ' 823767 email: [email protected]

Operational : Ann Kingswell ' 823713 email: [email protected]

Building Control

Budget : Tracy Ringer ' 823258 email: [email protected]

Operational : John Lutas ' 824588 email: [email protected]

Beach Cleansing and Foreshores

Budget : Rob Cooney ' 823831 email: [email protected]

Operational : John Metcalfe ' 823842 email: [email protected]

Local Agenda 21

Budget : Richard Wood ' 823652 email: [email protected]

Operational : Tony Geeson ' 823291 email: [email protected]

Paul Wilkinson Derek Rowell

Chief Financial Officer Strategic Director of Environment Services