PAPER C

REASON FOR SELECT COMMITTEE CONSIDERATION

This report sets out the budget and spending position on both revenue budgets and the highways capital programme as at the end of May. Within the Comprehensive Performance Assessment framework, one of the key criteria is that financial reports relating to underlying financial records are prepared and reported to members on a regular basis in order that focus is maintained on the Council’s strategic priorities. 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.

REVENUE EXPENDITURE

The report details gross expenditure, income and net expenditure to date against budget as shown at appendix 1. It also shows the current variance, which compares the net budget with the net expenditure to date. In order to provide more meaningful information, commitments have been included with the expenditure to date figures for the more significant contract sums where the likely expenditure in the year can be relatively easily predicted i.e. waste management budgets, toilet cleansing and street cleansing. This has had the impact of showing the net budget to be heavily committed at this stage of the financial year; however the impact will reduce through the year as expenditure replaces commitments.

Members will recall that the budget strategy of the Council for this year suggested a reduction of £248,000 in the highway maintenance budget to reflect the fact that a standstill budget would represent an amount of some £488,000 in excess of the Formula Spending Share (FSS). There is a need to monitor both the highway maintenance and traffic management budgets closely as a result of 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. The final potential budget pressure area is in the public transport budget where there is a statutory requirement to meet increased costs arising from the Concessionary Fares Age Equalisation scheme.

In addition to those pressures, other areas which require budgets to be identified on an ongoing basis are highways landslide monitoring, bridge inspections and highway condition surveys. Finally, landfill tax continues to require constant scrutiny to ensure that accumulated expenditure is consistent with budget availability.

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.

Since last month the budget for the Newport to Cowes Strategic Corridor has been increased by £185,000 to reflect higher financial commitments to works in the corridor than the original estimate. The increase has been accommodated by transferring £50,000 from bus infrastructure, £100,000 from walking schemes, and £35,000 from the Newport to East Cowes Strategic Corridor. The first two transfers are a result of an investment in bus infrastructure works and walking schemes within the Newport to Cowes Strategic Corridor project; the latter is a result of a saving against original estimate on the Newport to East Cowes Strategic Corridor.

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

Appendix 2     Capital Expenditure

BACKGROUND PAPERS USED IN THE PREPARATION OF THIS REPORT

None used in the preparation of this report.

Contact Point :           Stuart Fraser ☎ 823657 email: [email protected]

PAUL WILKINSON

Chief Financial Officer