Agenda item

To receive the report of the Strategic Director for Corporate Resources.

The Strategic Director for Corporate Resources presented the report making the following points:

·         all documents provided had been considered by Full Council and this was an opportunity to ask questions to better understand the financial position;

·         he was currently conducting a review of how financial information was presented to Members and endeavouring to make it more user-friendly especially at the end of the year; and

·         any underspend at the end of the year can be caused by late funding from government and there was a will to make the true position for each service more understandable.

The Strategic Director for Corporate Resources responded to Members questions in the following terms:

·         he would ask the museum service for performance data to give a fuller answer but the previous café owner had given notice and a trial was being undertaken with the team who run the café at St Sidwell’s Point and there was a small budget for this;

·         the St Sidwell’s Point café staff were council employees;

·         £1.1 million of the required £1.4 million had been delivered and this was the purpose of carrying reserves, to support and protect the Council should all savings not be made;

·         budget savings can prove to be challenging and setting income targets was a projection and may run short as it involved a range of assumptions and central government sometimes made changes;

·         a best estimate was £5.7 million savings required over the next three years;

·         Government was committed to business rate reset and this was the single reason for the required reductions;

·         there were some issues of staff shortage making some projects difficult to deliver and Members could ask any Head of Service why projects which had been signed off were not being delivered;

·         it may have helped if the business rate retention scheme had been reset in 2018;

·         some council’s had found this useful in balancing changes in government grants;

·         the council did not respond to the consultation but have commissioned some indicative work;

·         there were pockets of deprivation but compared to other areas in the country Exeter did not score highly for deprivation;

·         with Local Government reorganisation the Guildhall would no longer be suitable for office relocation and options were being considered and would be taken back to full Council at the appropriate time;

·         the idea had been to fund works from the Guildhall shopping centre surplus in order to free the Civic Centre for housing;

·         there was an assessment of the number of people who don’t live in the city but travel in which used a formula to calculate how much funding was received;

·         an amount was being paid to fund the backdated pension deficit;

·         pension valuation was being undertaken and there was an improved position;

·         the valuation was designed to meet an accounting standard which was calculated differently to a triennial valuation;

·         it was very difficult to project pension contributions but there was a three-year agreed amount and above this the tendency was to increase slightly each year;

·         information would be provided by Devon County Council as they administered local pension;

·         last year Strata’s pension fund broke-even and Exeter’s was into the 90 percents from an accounting point of view;

·         there were different types of debt and income generated through a range of sources but some debts could be quite old but would be chased if tenant was in situ as arrears and would become debt when the tenancy was ended;

·         there were two processes which would be followed for debt depending on whether the tenant was existing or previous;

·         there were vacancies in some areas and one was the central sundry debt team but work on resolving this was being undertaken;

·         a range of techniques were used to recover debt with three areas where write-off was sought – uneconomical, low value debt, if a company or individual was declared bankrupt, had a debt order or Individual Voluntary Arrangement where there was no means to recover the debt or where all avenues had been exhausted;

·         the write-off process would depend upon the value of the debt but would always involve the Strategic Director and on occasion the Portfolio Holder where the value of the debt required;

·         earmarked reserves titled Sure Start remained due to funds having been provided by Sure Start in 2005 to provide a play area and must be kept forever in order to provide interest for maintenance and stood at around £20,000;

·         he would take back to the service the questions of what the difficulties in appointing a project manager and the ensuing delays in leisure enhancements and what measures were being taken;

·         he would also ask the service to respond regarding which initiatives had not begun utilising CIL funds;

·         Wellbeing Exeter was funded through CIL Neighbourhood funding and was reliant on the amount of CIL collected and delays to developments could cause challenges;

·         there was a plan to alleviate and support temporary accommodation which related to the General Fund and a particular length of lease was required for the maximum housing benefit subsidy and this had to sit within the HRA;

·         the risk that rental income wouldn’t be sufficient had been considered but deemed a low risk in respect of these properties;

·         HRA was self-contained and funds would need to be found elsewhere in the budget, usually by scaling back the capital programme should the repayment not be met; and

·         it would not be possible for earmarked reserves to be used for murals; this would usually come from annual maintenance budgets and the one for the play area was specific.