6.13

North Somerset Council

Report to Strategic Planning and Economic Development Policy and Scrutiny Panel

Date of Meeting: 12^th March 2007

Subject of Report: Quarter 3 Finance and Performance Monitoring 2006/07

Town or parish: All

Member presenting: Chairman

Key Decision: No

RECOMMENDATIONS

It is recommended that the Panel examine the key variances contained in part two of the report. As well as noting the good performance highlighted in part 3 of the report.

1. Summary of Report

This report is extracted from the report that went to the Executive on 13^th February 2007

The purpose of the report is to inform the Panel of the anticipated financial position for the Council’s General Fund and Contract Services as at 31^st December 2006, together with monitoring of key performance targets.

As with the quarter 2 report, the financial position is detailed alongside quarter 3 progress of the Council’s Key Corporate Performance Indicators (KCPIs).

2. Policy

N/A

3. Details

3.1 Introduction

The attached report provides the second quarterly budget and performance monitoring report, for the 9 months to December 2006. The report is summarised into the following sections:

o Part 1 – Overall summary position for Finance and Performance

o Part 2 – Identifying key variances

o Part 3 – Directorate commentaries

o Part 4 – Other financial monitoring information

Part 3 of the report incorporates a comprehensive commentary from the relevant director which includes a financial and performance overview for their service area. It also identifies service delivery achievements, major performance and financial variances together with any mitigation factors or further actions that may need to be taken.

3.2 Performance Monitoring

The Corporate Plan 2005/06 to 2007/08 contains targets for each of the Council’s Key Corporate Performance Indicators (KCPIs) and these are grouped by the Council’s corporate priorities. Actual performance against these targets is monitored on a quarterly basis.

In Quarter 3, 41 KCPI results are known (of the 67 indicators in the Corporate Plan). From these 41 results:

o 75% of these KCPI results have shown improvement since the year end of 2005/06

o 75% of these KCPI targets for 2006/07 look set to meet the ambitious annual targets set in the Corporate Plan 2005/6-2007/8.

Details of the Council’s key service delivery achievements are highlighted within each of the Directorate commentaries, together with further action reports where necessary.

3.3 General Fund Revenue Expenditure

There is projected net overspend on the Council’s General Fund revenue budgets of £128k at the year-end. This projection includes variances arising from key risks identified within the Medium Term Financial Forecast, as well as other financial variances over £50k.

However, Members will recall that the Council has been advised that it will receive approx £0.314m from Bristol City Council in relation to the balances and reserves of the former Avon County Council. In addition, the Council has received approximately £0.184m relating to refunds of NNDR. It is therefore projected that there will be a net contribution to the Council’s General Revenue Reserves of £0.370m at the end of the financial year. This compares with a projected contribution from reserves of £0.462m at month 8.

The reasons for the projected net overspend are incorporated within each of the directorate commentaries, but Part 2 of the Monitor does highlight the major variances and issues identified by the Council.

The Corporate Management Team continues to monitor the Council’s financial position on at least a monthly basis, together with the effects of the broad mitigating strategies that have been implemented. It is anticipated that a balanced budget should be achieved at the end of the financial year although CMT has considered further measures, such as a recruitment freeze, a moratorium on equipment and other discretionary spending (such as highways maintenance) and cancellation of planned training and development courses which could be implemented at a later stage if required, although it is recognised that such an approach would be indiscriminate and lead to increased pressure on existing staff and deterioration in service delivery standards in an unplanned way.

3.4 General Fund Capital Monitoring

Appendix 5a shows the Council’s capital monitoring as at 31st December 2006. This detailed schedule allows Members to review the budgets and expenditure for each of the projects being undertaken at this time. This schedule also identifies projects with projected variances, which have been conveyed to Members in previous reports.

Listed within Appendix 5c are the amendments to the capital programme, the details of which have been approved by the Capital Board. There are 2 new projects requiring approval from the Executive together with adjustments to various current schemes, including re-phasing of budgets into 2007/08, which allows a more realistic budget to monitor against.

4. Consultation

N/A

5. Financial Implications

See main detail of report

6. Equality Implications

None

7. Corporate Implications

The KCPI report is part of the Councils overall Performance Management Framework, and is integrated into the Corporate Plan 2006/7-2007/8.

8. Options considered

None

Author

Peter Sloman, Head of Financial Management, 01934 634619

Shane Trevett, Scrutiny and Performance Team Manager, 01275 884009

Extracts taken by Camilla Marlow, Scrutiny & Performance Officer, on behalf of SPED.

Background Papers

Q2 finance and performance monitoring report.

PART 1: Overall summary position for Finance & Performance

General Fund Revenue Expenditure

The General Fund Summary as at 31^st December 2006 is shown at Appendix 1a. The summary provides for the use made of earmarked reserves available to Directorates at the end of 2005/06 and, in addition, the revised budgets reflect the minor virements that have been approved during the first 9 months of the financial year. The projected year-end position on the General Fund for 2006/07, as at the end of Period 9 / Quarter 3, is as follows:

	£000
General Fund Approved Budget for the year	121,846
Predicted year-end position	121,975
Projected overspend on GF services as at 31^st March 2007	128
Contribution re Former Avon CC reserves and balances	-314
Windfall savings re NNDR Refunds	-184
Currently anticipated contribution to General Fund non-earmarked reserves	-370

The projected net overspend of £0.128m (or 0.1% of the Council’s net budget), has arisen within the following areas:

	£000
Children & Young People’s Services	312
Adult Social Services & Housing	952
Development & Environment & Contract Services	-291
Finance & Resources and Corporate Services	-70
Capital Financing and Interest on Balances	-922
Non Service Budgets	147
Projected overspend on GF services as at 31^st March 2007	128

Key Corporate Performance Indicators

The Corporate Plan 2005/06 to 2007/08 contains targets for each of the Council’s Key Corporate Performance Indicators (KCPIs) and these are grouped by the Council’s corporate priorities. Actual performance against these targets is monitored on a quarterly basis.

In Quarter 3, 41 KCPI results are known. From these 41 results:

· 75% of these KCPI results have shown improvement over 2006/07

· 75% of these KCPI targets for 2006/07 look set to meet the ambitious annual targets set in the Corporate Plan 2005/6-2007/08.

Details of the Council’s key service delivery achievements are highlighted within each of the Directorate commentaries, together with further action reports where necessary.

PART 2: Identifying key variances

Financial and Performance Key Variance Issues

The detailed reasons for the projected net overspend of £128k at the year-end are incorporated within each of the Directorate commentaries shown in Part 3, as are performance achievements, but the major issues resulting in financial or performance variances are shown in the table below:

Corporate Priority	Projected General Fund Variance	Performance Issue
Enhance the quality of our natural and built environment	Over recovery of Development Control income of £132k. See D&E Directorate Commentary	See D&E Directorate Commentary on service delivery achievements on abandoned vehicles, street cleanliness and for the speed of ‘major’, ‘minor’ and ‘other’ planning applications.
Improve transport infrastructure		The KCPIs for transport infrastructure are only reported annually.
Promotes safe and sustainable travel	Underspend of £107k in relation to salaries partly from efficiency savings and part from delays in the filling of posts. See D&E Directorate Commentary	The KCPIs for safe and sustainable travel are only reported annually.
Increase local job opportunities in Weston-super-Mare		Economic regeneration performance indicators are being developed. See D&E Directorate Commentary for service delivery achievements of the Ready4Work scheme
Reduce economic exclusion and deliver area-based community regeneration
Promote Weston-super-Mare as strategically significant town

PART 3: Relevant Directorate Commentary

COMMENTARY FROM THE DIRECTOR OF DEVELOPMENT AND ENVIRONMENT

Director: David Turner

Directorate Overview

Budget

The current estimated outturn position for the Directorate, after estimated use of earmarked reserves is £43.253m compared to a budgeted amount of £43.545m, giving an anticipated variance of a £0.292m under spend (0.67% of the directorate budget.

KCPIs

The Development and Environment Directorate has data returns for 18 KCPIs in Quarter 3. 72% of the KCPIs are on track to meet their annual target. There will be an additional 16 KCPIs monitored over Quarter 4 with end of year targets only.

Service delivery achievements

The volume of older and younger people using leisure facilities (KCPI 52) is 134,282 for Quarter 3, which equates to a cumulative total of 364,148 when the end of year target is 324,268.

The % of abandoned vehicles removed within 24 hours (KCPI 20, BVPI 218b), advanced the predicted target. The Quarter 3 data out turn was 80%, when the predicted end of year target is 76%.

The new street cleansing contract was let with no budget increase to maintain service delivery standards. A 2006/7 target of 5% of relevant land and highways assessed as having combined deposits of litter and detritus that fall below an acceptable level (KCPI 55, BVPI 199a) has been set. In 2005/06 this indicator achieved 5% and 7% in 2004/5. The 2004/5 national average was 17.5%. A level of 3% was achieved for Quarter 3 which is still in the best performing 10% of councils in the country and continues to improve from each quarter.

The annual review of the Waste Strategy is complete and the tonnage review has led to savings of £311k in the 2007/8 draft budget. Cumulative Landfill Allowance Trading Scheme (LATS) permit balance (KCPI 72) stands at 15,206 permits for later usage, which has already exceeded an annual target of 10,920 permits and continues to improve from its previous quarter.

31% of household waste was recycled and composted (KCPI 48, BVPI 82a+b), (17.0% recycling, 14.3% composting) which although decreased by 1% from Quarter 2, the indicator continues to exceed its annual target of 29.9% (16.7% recycling, 13.2% composting.)

The % of household waste that was land filled (KCPI 30, BVPI 82d) was 69% and continues to remain under an end of year target of 70.1%

The volume (in terms of weight) of household waste arising per head of population (KCPI 31, BVPI 84a) continues to reduce, but at a lower rate than in the previous 2 quarters and met its Quarter 3 target with 406.1 kilograms of household waste being collected (per head of population) compared to an expected level of 479.9.kgs. Waste tonnages are subject to large fluctuations and are sensitive to a number of complex variables, including weather conditions, retail activity, timing of public holidays and resident behaviour, as well as service changes and marketing and education activity. See detailed report for Environmental Services Policy and Scrutiny Panel for 27^th February 2007.

There are beneficiaries of the Ready4work scheme being monitored as part of the process of enabling people on incapacity benefit and income support living in WsM South and Central wards to be helped by the Council into sustained employment. The latest figure of 44 for Quarter 3 shows this to be on track to meet its end of year target of 45 people being assisted for 2006/7 (KCPI 43.)

The speed of processing ‘minor’ applications (KCPI 29c, BVPI 109b) remains on track to achieve a 2006/7 end of year target of 68%, despite decreasing from its Quarter 2 position of 75.5%. The indicator currently stands at 72.3%, but has dipped from Quarter 2 mainly because of staff shortages and demand in minor applications.

There were 88% of “other” planning applications decided within 8 weeks for Quarter 3 (KCPI 29a, BVPI 109c). This is on track to meet its end of year target of 85%.

The speed of processing ‘major’ planning applications raised a further action report for Quarter 1 and made some progress in Quarter 2 with 56.8%. The Quarter 3 figure is back on target at 70.8% for this quarter, and should achieve the end of year target of 63%.

Reported incidents of Common Assault (KCPI 26) continues to decrease with a 25.9% decrease in reported incidents from Quarter 2 to Quarter 3. This indicator should achieve its end of year target of an 11.5% reduction in incidents from 2005/6 to 2006/7.

The number of reported incidents of Theft of a motor vehicle (KCPI 23) has continued to decrease for this quarter, with a 7% reduction during Quarter 2 and a further 2.8% reduction during Quarter 3. This indicator is still on track to achieve an overall end of year target reduction of 11.5% for 2006/7 over 2005/6.

Major variances and further actions

Financial Variances in relation to risks identified in the Medium Term Financial Plan

Waste Strategy Implementation (£583k underspend)

· Waste disposal – reduction in tonnages compared with budget (£342k underspend)

· Green waste processing – reduction in tonnages when compared to budget (£151k underspend)

· Delay in implementation of plastics recycling at HWRCs and synchronisation of collection days (£90k underspend)

The 2006/7 budget was calculated following a review of the waste strategy, which was reported to the Executive in September 2005. A full report will be presented to the February meeting of the Environmental Services Policy & Scrutiny Panel, reporting the first 9 months performance in relation to the Waste Strategy. In addition, the second annual review of the strategy was presented to the Executive in October 2005 and the tonnage review has led to a £311k saving in the proposed budget for 2007/08.

Super Inflation (£58k overspend)

The unit cost of the new street lighting energy contract was higher than anticipated, resulting in a projected overspend of £58k, as reported to the Executive in September 2006. The additional cost of the new contract has been taken into account in the setting of the 2007/8 budget.

Income targets and increase in income (£11k underspend)

· Fee and legal income in Development Control - £132k underspend

· Increase in licensing income - £45k underspend

· Industrial Units and Depots - £31k overspend

· Parks income - £70k overspend, largely in relation to income streams from grants and s106 coming to an end

· Street Trading scheme, not yet implemented - £36k overspend

· Car parking income - £36k overspend in relation to permit and garage income not being received as anticipated

The most significant of these variances have been taken account in the setting of the 2007/08 budget.

Concessionary Fares

A small projected overspend of £40k is anticipated due to an increase in passenger journeys and an increase in fares (from 1 Jan 2007) by the First Group. The cost risks and uncertainties in relation to concessionary fares have been taken in account in the setting of the 2007/8 budget.

Other variances (over £50k)

Waste (non waste strategy related) (£114k overspend)

£114k one-off revenue contribution to the costs of making the rock face safe at Black Rock Household Waste Recycling Centre

Leisure and Libraries Salaries (£228k overspend)

Information from the salaries paid to date indicates that there is a potential overspend of £276k. Analysis indicates that £228k of this overspend has arisen as a result of the implementation of Single Status, particularly in leisure centres, the Playhouse and the Winter Gardens. This has been taken into account in the setting of the 2007/08 budget.

Refund of NNDR on seafront car parks (£52k underspend)

Following a revaluation of car parks, there is an underspend in this area, however, some if this is being used to offset a slight under-recovery of car park income when compared to budget. The refund had been taken into account in the setting of the 2007/8 budget and is shown as a base budget saving.

Planning & Transport Policy Salary Savings (£107k underspend)

Currently an underspend of £107k in relation to salaries partly from efficiency savings and part from delays in the filling of posts.

Central recharges – legal (£63k underspend)

Offset by increased expenditure in other Directorates

Performance

Theft from a motor vehicle (KCPI 22 Theft from a motor vehicle is showing an increase of 8.1% (year on year comparison). The Partnership has completed extensive analysis of theft from a motor vehicle offences. This shows that offences relate to on street parking. The analysis shows that some of the offences relate to new technology e.g. satellite navigation equipment being stolen. This is a national problem. A further issue which has fuelled the increase in theft from motor vehicle, locally, is theft of number plates. Extensive analysis shows little pattern in these offences and there is little evidence to suggest why the plates are being stolen.

Targeted work has taken place in North Somerset using a covert capture car which records images of criminals breaking into the car. To-date, 18 offenders have been prosecuted as a result of this work. There has also been extensive publicity of this work to act as a deterrent. Enforcement activity has increased in relation to illegal on-street parking. This should have a knock-on effect of drivers making greater use of car parks where there is less risk of their vehicle being broken into. Aspects of Decriminalised Parking Enforcement could also encourage drivers to leave their cars in less vulnerable locations. Number plate fixings which make them more difficult to steal have been introduced and a number plate amnesty was held to try and gather intelligence on thefts. Crime prevention activity has also focussed on steps drivers can take to avoid thefts from vehicles e.g. not leaving valuables on display.

Wounding (KCPI 24.) In previous reporting periods, there has been an overall reduction in all violent crime, with common assault decreasing and wounding increasing. However, in quarter 3, overall violent crime has increased by 3.2%. This is due to a continued increase in wounding. Whilst common assaults continue to decrease, there are more incidents of wounding which has the greater impact on the overall level of violent crime.

The Partnership is continuing multi-agency checks on licensed premises to ensure that these are well managed and the risks of violence reduced. To date, 301 multi-agency checks have been undertaken since November 2005. These have resulted in a variety of actions including 2 licensing hearings (where further conditions were introduced) and 5 premises action plans. The Partnership is also investing in body worn surveillance (head worn cameras) which improve evidence gathering in relation to violent crime. There is also a new alcohol worker to address alcohol-related offending. Multi-agency risk assessment conferences for the highest risk domestic violence cases with the aim of reducing repeat incidents of violence are also being introduced.

Burglary (KCPI 25) is continuing to reduce. However, it is not currently meeting the reduction target of -8.5%. Significant reductions have been achieved over the last few years but these are difficult to sustain. This year has been particularly challenging with an extended summer period meaning that there was an increase in burglaries to insecure properties (through open doors and windows).

Burglary reduction remains a priority with targeted work with prolific offenders and crime prevention activity continuing. A community safety event is scheduled to take place on 24 February which will provide crime prevention products and advice. Mobile Automatic Number Plate Recognition (ANPR) is used on the main road routes into North Somerset. This assists with detecting known offenders coming into the area to commit acquisitive crime (burglary and theft from motor vehicles). In the future, this approach may be enhanced by the introduction of fixed ANPR sites and discussions are taking place around the introduction of this type of system.

Criminal damage (KCPI 21) offences have increased by 6.4% (year on year comparison to the end of Quarter 3). Part of this increase may be due to a recording issue. Avon & Somerset Police have introduced a new call-handling system which means they are now taking more calls and recording more crime.

Reducing criminal damage is a stretch target within the draft Local Area Agreement. Neighbourhood Policing and area-based working by a range of agencies (e.g. North Somerset Council Streets & Open Spaces and Environmental Protection and North Somerset Housing) is targeting anti-social behaviour and criminal damage. In hotspot locations a range of measures are being used in a concerted effort to reduce anti-social behaviour and criminal damage. For example, in the Maltlands area, a dispersal order has been combined with action on underage sales, increased police patrols and an anti-social behaviour road show run by the youth outreach project visiting the area. A Crimestoppers campaign is being introduced in schools to encourage young people to come forward with information on who is committing criminal damage offences. Initiatives to reduce disorder associated with the night-time economy are also continuing.

The number of Public Library Standards (KCPI 19), remains at 6 standards met in Quarter 3 of 2006/7. The indicator is off target to meet its annual target of 7, during this quarter we failed to meet Standard 7 on customer satisfaction in the national PLUS survey (2006: 88.6% respondents thought their library service good or very good; Standard 94%).

The full Adult PLUS survey can officially only be run again in Autumn 2009, although we could ask the satisfaction question as a performance check in the interim. The Children’s PLUS survey will be run in Autumn 2007, and this satisfaction question is the next Library Standard we can achieve. We are taking a number of steps to ensure that services for under-16s can achieve a higher rating by then (2004: 73.8 rated service as good; Standard 77%). It should be noted that the Library Standards are currently under review and likely to be changed from 2008/9.

Financial and Service Risks and Further Action

The main financial risks inherent in the Development and Environment budget are set out in the published MTFF. No significant additional risks have been identified.

Anticipated / proposed contributions to / from earmarked reserves

At this stage, it is anticipated that Development and Environment will utilise the following earmarked reserves during 2006/7 and these sums have been reflected within the directorate revenue monitoring statement:-

· £10k Car Park Management shown within Leisure and Libraries

· £25k Road safety shown within Transport Planning

· £4k Office moves and accommodation shown within Improvement and Performance

· £43k Libraries Improvement Plan shown within Leisure and Libraries

· £1k Museum Promotion shown within Leisure and Libraries

· £1k Cycleways shown within Transport Planning

· £43k Health and Safety Reserve shown within Streets and Open Spaces

In addition the Directorate has reviewed and rationalised its earmarked reserves resulting in a transfer of £114k to the Waste Strategy Reserve.

Efficiency Gains

The Directorate’s efficiency gains target for 2006/7 is £1,422k. It is anticipated that the target will be exceeded by £441k, largely as a result of increase efficiencies in waste management due to reducing tonnages, as shown in the table below.

Summary of Efficiency Gains	Target / Budget	Actual	Variance
	£000	£000	£000
D & E Cashable Efficiencies	-868	-1,309	-441
D & E Non Cashable Efficiencies	-554	-554	0
Total Efficiency Gains	-1,422	-1,863	-441