REPORT OF THE STRATEGIC DIRECTOR FOR FINANCE & INFORMATION AND COUNTY TREASURER

SUMMARY / PURPOSE

This report sets out the budget and spending position on both revenue and capital for the services within this Committee’s remit, as at the end of July. The figures do not include budgets that are controlled elsewhere than the service concerned. These are monitored by the Committee which bears responsibility for the item concerned. (For example, Resources Select Committee monitors the building maintenance budget centrally, and building maintenance costs are not therefore shown against individual services below).

REVENUE EXPENDITURE

The report details gross expenditure, income and net expenditure to date against budget as shown at appendix 1. The expenditure and income has been classified over thirteen distinct categories, each of which may have different spending or income generation characteristics. For example, the waste management budget has expenditure which accrues fairly evenly through the year, with increased contract payments from November, the anniversary of commencement of the contract. By contrast, the county transport and management and supervision budgets also have expenditure which accrues fairly evenly through the year, but in addition have a considerable requirement for recharges to service budgets and capital budgets which tend to take place in arrears of the expenditure; whereas the car parking service generates a considerable amount of income, an element of which is seasonal.

At this stage of the financial year there are still few significant variances to report. Members are aware that, as part of the closedown process for last financial year, an overspend of some £373,500 occurred in the highway maintenance budget. As suggested in last month’s monitoring report, the Executive agreed that in view of the high public priority of the service, coupled with the Council’s efforts to produce a step improvement in this area, it would be prudent on this occasion to write the overspend off within the context of significant corporate savings overall. In addition, a number of carry forwards of underspent budgets in the previous year have also now been approved, notably in coast protection and highway safety maintenance for cliff stabilisation works, beach safety and inspection and Agenda 21.

Members are already aware that there are financial implications arising from the emergency works undertaken at Coppin’s Bridge to the bridge structure. The cost of the emergency works already undertaken, plus any further remedial works which prove to be necessary, have still to be finalised and a decision made as to whether they are capital or revenue in nature. In either case there will be an impact on existing budgets. That point is noted in the Revenue Expenditure Table attached as appendix 1, together with a number of other comments on the services within this Committee’s terms of reference.

CAPITAL EXPENDITURE

Expenditure against each scheme is shown at appendix 2.

The budgets shown are those approved for the current financial year, described as 2002-2003 schemes, and those slipped from the previous year, described as 2001-2002 slippage. The current years budget forms a part of the single capital pot, for which expenditure must be completed by 31 March 2003. Last year’s capital settlement was in the form of 2 year supplementary credit approval for which expenditure also has to be completed by 31 March 2003. The total approved budget for the year is in excess of £11.5 million, of which £3.4 million has been spent by the end of July, with a further £1.1 million committed. Within the total approved budget figure there is some £1.9 million for the Military Road project, on which negotiations are still being progressed with prospective contractors. The budget for the project has been in place for some years now, and the net underspend has been carried forward year on year to ensure the maximum amount is available when tenders are received. Consequently, there is flexibility to carry forward any underspend once again, should that prove to be necessary. There are also over-allocations of budget on the Newport to Ryde strategic corridor and included in slippage brought forward from the previous year, which will both need to be managed within the total resources available. This is in accordance with the resolution of the Executive on 26 February 2002 which delegated responsibility for delivery of the full programme to the Portfolio Holder for Transport and the Head of Service, within the broad themes identified and the available finance.

Contact Point : Stuart Fraser Φ 823657

John Pulsford

Strategic Director for Finance and Information and County Treasurer

REVENUE EXPENDITURE SUMMARY as at end of July

Service	Expenditure		Income		Net
	Budget	To date	Budget	To date	Budget	To date	Comment
	£000	£000	£000	£000	£000	£000
Management and Supervision including Policy and Strategy	1,322.5	613.3	-148.8	-156.5	1,173.7	456.8	Budget includes Transport Planning, Policy and Strategy and Professional and Engineering Services. Expenditure budget is net of design and supervision fees to be recharged to capital projects – first quarter’s charges now complete in many cases
Coast protection, harbours and seafronts	873.0	416.0	-212.7	-89.8	660.3	326.2	This budget now includes carry forward of £236,200 from the previous year in respect of contractually committed cliff stabilisation works, and £19,200 on beach safety and inspection
Waste management and recycling	6,139.1	950.5	-7.2	-5.4	6,131.9	945.1	Budget includes all aspects of the Integrated Waste Management contract, and also includes the landfill tax budget. IWM contract invoices tend to be some weeks in arrears, hence the apparent budget surplus
Public conveniences and first time sewerage	438.5	122.5	-6.2	-0.2	432.3	122.3	Main budgets are for the contractual cleaning of the public conveniences and operational costs such as rates, water and electricity
Building control	416.8	135.8	-383.3	-159.3	33.5	-23.5	Income presently ahead of target due in part to amounts received last year relating to works not yet started, hence accrued into the current year
Street and beach cleaning	1,350.0	332.7	-0.3	-0.7	1349.7	332.0	As is the case for the waste management and recycling budgets, street cleansing invoices in particular tend to be some weeks in arrears, hence the apparent budget surplus
Highway maintenance	1,847.2	555.0	-33.5	-14.6	1,813.7	540.4	Overspend of £373,500 from previous year now written off in that year rather than carried forward and offset against this year’s budget. Coppin’s bridge remedial works to consider

REVENUE EXPENDITURE SUMMARY as at end of July

Service	Expenditure		Income		Net
	Budget	To date	Budget	To date	Budget	To date	Comment
	£000	£000	£000	£000	£000	£000
Traffic management and road safety	657.6	372.9	-14.0	-5.0	643.6	367.9	This budget now includes carry forward of £244,000 from the previous year in respect of contractually committed cliff stabilisation works linked to highway safety
Street Lighting	605.6	150.9	-10.0	-2.2	595.6	148.7	Budget covers all aspects of the street lighting service, including power, planned maintenance and routine maintenance
County Transport	432.6	651.5	-294.2	-63.4	138.4	588.1	Budget includes operational costs of Wightbus, Home to School Transport and the Council’s vehicles and plant prior to their reallocation to service areas. The budgets shown are net of recharges to service user budgets, however no recharges have taken place for the first quarter, hence the current overspend shown
Public Transport including Cowes Floating Bridge	1,566.2	503.2	-578.1	-207.7	988.1	295.5	This budget contains the costs of subsidised local bus services, Rural Bus Grant Services and concessionary fares schemes, as well as the operation of the Cowes Floating Bridge. Income is mainly from the Floating Bridge and the Rural Bus Grant
Car Parking	610.2	315.7	-2,118.3	-1,011.6	-1,508.1	-695.9	The main focus of this budget tends to be on income generation because of its relative significance and the impact it can have on the delivery of other service areas e.g. traffic management and public transport. Income is accruing reasonably well to date, although a significant proportion is seasonal
Environmental Initiatives including Agenda 21	159.1	52.2	-95.7	-8.4	63.4	43.8	This budget includes the Coastal Visitors Centre and associated projects as well as the Agenda 21 budget. A carry over of £13,800 from the previous year has been included in the Agenda 21 budget to assist delivery of the objectives of that service