Venue: Virtual Meeting
Contact: Democratic Services - 01522 873387
RESOLVED that the minutes of the meeting held on 20 February 2020 be confirmed.
Declarations of Interest
Please note that, in accordance with the Members' Code of Conduct, when declaring interests members must disclose the existence and nature of the interest, and whether it is a disclosable pecuniary interest (DPI) or personal and/or pecuniary.
Councillor Pat Vaughan declared a Personal Interest in relation to agenda item titled 'Financial Performance - Outturn 2019/20'. Reason: His granddaughter worked in the Finance Section of the City of Lincoln Council.
Councillor Pat Vaughan declared a Personal Interest in relation to agenda item titled 'Treasury Management Stewardship and Actual Prudential Indicators Report 2019/20 (Outturn)'. Reason: His granddaughter worked in the Finance Section of the City of Lincoln Council.
In the interest of transparency Cllr Helena Mair requested it be noted that her husband’s employer was involved in several local projects which involved the City of Lincoln Council including the Rookery Lane and Central Market refurbishment. If any reference was made to these projects, she would leave the room at that point and not take part in discussions thereon.
Jaclyn Gibson, Chief Finance Officer,
a) provided Members with a status report for the City of Lincoln Councils Strategic Risk Register:
b) highlighted that since reporting in February 2020, the COVID-19 pandemic had fundamentally affected the environment in which the Council operated and as such the risks that it faced. Whilst the strategic risks that were previously included in the register remained valid, the level of assessed risk (likelihood and impact), target risk scores and mitigating action needed to be reviewed and updated to reflect the new landscape, as well as identifying any new strategic risks.
c) explained that considering these circumstances the quarter four strategic risk register for 2019/20, which would ordinarily include an assessment of whether the target risk for the year had been met or not, had not be prepared. Instead setting out in this report what were now considered to be the strategic risks/opportunities facing the Council having taken into consideration the impact that the pandemic and lockdown arrangements had, as well as the path to recovery.
d) highlighted ten existing strategic risks that were all still felt to be relevant, although re-framed to reflect the effects of the pandemic and focus of the Council in 2020/21:
1. Failure to engage and influence effectively the Council’s strategic partners, council staff and all stakeholders to deliver against e.g. Council’s Vision 2025.
2. Failure to deliver a sustainable Medium-Term Financial Strategy (that supported the delivery of Vision 2025).
3. Failure to deliver the Towards Financial Sustainability Programme whilst ensuring the resilience of the Council.
4. Failure to ensure compliance with statutory duties/functions and appropriate governance arrangements are in place.
5. Failure to protect the local authority’s Vision 2025 due to changing structures and relationships in local government and impact on size, scale and scope of the Council.
6. Unable to meet the emergency changes required in the Council’s culture, behaviour and skills to support the delivery of the Council’s Vision 2020/2025 and the transformational journey to One Council approach.
7. Insufficient levels of resilience and capacity exist in order to deliver key strategic projects & services within the Council.
8. A decline in the economic prosperity within the City Centre.
9. Failure to mitigate against the implications for the Council following the outcome of Brexit.
10. Failure to deliver key strategic projects.
e) explained in addition to the ten existing strategic risks, three new risks relating to the impact of the pandemic had emerged and were as follows:
· Failure of the Council’s key contractors and partners to remain sustainable and continue to deliver value for money.
· Failure to work in partnership to sustain support to vulnerable residents post COVID-19.
· Failure to put in place safe working practices and social distancing measures to protect officers and service users.
f) invited members’ questions and comments.
Question: Members asked whether checks on contractors could be carried out?
Response: The City of Lincoln Council did have the ability to do financial checks on contractors if there were concerns.
a) the status ... view the full minutes text for item 3.
Colleen Warren, Financial Services Manager,
a) presented performance scrutiny committee with the provisional 2019/20 financial outturn position on the Council’s revenue and capital budgets
b) explained that in relation to the General Fund Revenue Account, the financial performance quarterly monitoring report for the 3rd quarter predicted a shortfall against the revised budget of £222,080. The provisional outturn for 2019/20 now indicated that this shortfall had decreased by £88,258, resulting in an overall budget shortfall of £133,822. This represented a variance against the revised budget of 0.99%. The key variances were as follows:
· City Hall, Industrial Estates & Lincoln Properties – Increased Income (£167,351)
· Housing Benefit Overpayments – Reduced Income £389,536
· Other Interest – Increased Income (£88,080)
· Car Parking – Increased Income (£90,912)
· Housing Regeneration – Reduced Expenditure/Increased Income (£98,366)
· MRP – Reduced Expenditure (£288,200)
· Direct Revenue Financing – Reduced Expenditure (£230,475)
· External Interest Payable – Reduced Expenditure (£222,139)
· Yarborough LC – Reduced Income – (£53,400)
· TFS Savings Target – Shortfall in delivery (£201,705)
c) advised that in relation to the Housing Revenue Account, the financial performance quarterly monitoring report for the 3rd quarter predicted an underspend of £79,582. The provisional outturn for 2019/20 now indicated an overspend of £71,514. This resulted in HRA balances at 31 March 2020 0f £1,007,095. The main over and underspends included within the provisional outturn were detailed in Appendix D, while the key variances were below:
· HRS Surplus – Additional Income (£72,487)
· Council Tax – Additional Expenditure £94,286
· Depreciation – Revaluation of properties – additional expenditure (£383,122)
· Loan Charges – Interest on additional borrowing – increased expenditure (£71,869)
· Major Repairs Reserve – DRF adjustment to fund additional depreciation and loan charges – (£440,526)
d) stated that in regard to the Housing Repairs Service, the financial performance quarterly monitoring report for the 3rd quarter predicted a £117,075 surplus outturn for 2019/20. The provisional outturn for 2019/20 showed a trading surplus of £72,487. The net trading surplus of £72,487 was the result of several year-end variations in income and expenditure against the approved budget. The main over and underspends included within the provisional outturn were detailed in Appendix F and the key variances were as follows:
· Reduced recharges for internal work and change to sub-contractor – reduced income (£181,936)
· Reduction in material costs – reduced expenditure (£104,741)
· Increased hire of equipment costs – additional expenditure (£87,633)
e) highlighted that in relation to the General Investment Programme, –the last quarterly report approved a General Fund Investment Programme for 2019/20 of £12,509,748. Movements in the programme since the approved revised budget decreased actual capital expenditure in 2019/20 to £10,056,747.
New projects/changes that required the approval of the Executive were:
· Disabled Facilities Grant – 2020/21 budget increased by £456,020 to match grant funding allocation.
· Car Park Improvements – Ticket Machines - £87,360 within 2020/21 funded by borrowing to purchase 16 new ticket machines to ensure all car parks were able to take contactless or chip & pin payments.
The changes that had been approved by ... view the full minutes text for item 4.
Sarah Hardy, Principal Finance Business Partner:
a) presented Performance Scrutiny with the annual Treasury Management Stewardship Report
b) explained that the prudential system for capital expenditure was well established. For the 2019/20 financial year the minimum reporting requirements were that members received the following reports:
· an annual Treasury Management Strategy in advance of the year (Council 26th February 2019)
· a mid-year Treasury update report (Executive 21st November 2019)
· an annual report following the year describing the activity compared to the strategy.
c) Key issues to note from activity during 2019/20 were:
· The Council’s total debt (including leases and lease-type arrangements) at 31st March 2019 was £120.258m as identified at appendix A of the report compared with the Capital Financing Requirement of £130.736m This represented an under-borrowing position of £10.478m, which was currently being supported by internal resources. Additional long-term borrowing would be undertaken in future years to bring levels up to the Capital Financing Requirement, subject to liquidity requirements, if preferential interest rates were available.
· The Council’s Investments at the 31st March 2020 were £30.55m as outlined in Appendix A of the report, which was £1.35m higher than at 31st March 2019. Average investment balances for 2019/20 were £28.833m, which was higher than estimated balances of £24.1m in the Medium-Term Financial Strategy 2019-24 due to the timing of borrowing taken. It was noted that this referred to the principal amounts of investment held, whereas the investment values included in the balance sheet were based on fair value. In most cases, this would be equal to the principal invested, unless the investment had been impaired.
· Actual investment interest earned on balances was £240k compared to £125k estimated in the Medium-Term Financial Strategy 2019-24 identified at Appendix A of the report
· The interest rate achieved on investments was 0.84% which was 0.31% above the target average 7-day LIBID rate (for 2019/20 the average was 0.53%)
d) advised that the following reported outturn position against the security and liquidity benchmarks in the Treasury Management Strategy were as follows:
- The Council’s actual average security risk for the portfolio as at 31st March 2020 was 0.004%, which compared with the 0.005% for the budgeted portfolio. This gave the estimated default rate on the investment counterparties which comprised the portfolio at 31st March 2020. This equated to a potential financial loss of £1,222 on the investment portfolio of £30.5m.
- Specified investments were high security sterling investments (i.e. high credit quality) with a maturity of no more than one year. Non-specified investments were all over investments representing a potentially greater risk; however, the risk was still minimal due to the stringent controls over counterparty credit quality contained within the Investment Strategy. The 2019/20 strategy set a maximum limit of 75% of the portfolio to be held in non-specified investments. At 31st March 2020, 80% of the investment portfolio was held in specified investments with the remaining 20% held in deposits with other local authorities. The Chief ... view the full minutes text for item 5.
Pat Jukes, Business Manager – Corporate Policy:
a) presented Members with a review of 2019/20 including the City of Lincoln Councils COVID-19 response in the following areas:
b) explained that in relation to COVID-19 Business Support, the government had made available a number of different grant funding options for businesses affected by COVID-19, so to ensure that Lincoln businesses benefit as much as possible, the Council’s Major Development Team set up a cross directorate working group of up to 20 people from ten services who used their skill sets to work together to maximise support for businesses.
c) advised that regarding COVID-19 Community Support, members of staff across many departments of the council were working from home to deliver vital services to prevent additional hardship to some of the most vulnerable in Lincoln. This included working with partner organisations across the community to fill any gaps in service and finding new ways to make it easier for people to ask for and access help, as well as seeking out groups of people impacted by COVID-19 and putting measures in place to allow them to access support such as:
· Befriending Service
· Community Signposting Helpline
· Online mapping of community groups
· Pensioner voucher scheme
· Free school meals
· Lincoln Community Foundation Crisis Fund
d) highlighted that in relation to helping the vulnerable, homeless and rough sleepers, the Homelessness Team were very busy dealing with historic and complex cases rather than seeing significant increases in homelessness. However, emergencies and helping people coming into the city needing accommodation and young and vulnerable people who had been asked to leave home or who were being exploited were dealt with by the team.
The Rough Sleeping Team had seen a definite increase in workload following the push to ensure all street sleepers were provided with safe internal accommodation. This included those who were in bed and breakfast and hotel accommodation which had closed as a result of COVID-19. Twenty-one people were offered accommodation as a result of this scheme.
Supported Housing – this service supported our most vulnerable tenants and as a result of the COVID-19 impact, had adapted its service to both protect and support tenants.
Lincare Home Support – Lincare had continued to operate its 24/7 telecare services for all its clients throughout the crisis. This was a critical service at the best of times, but even more so during the current COVID-19 crisis.
Customer Services – the number of calls consistent with what would be expected in a normal Q4 had been taken, at 29,739, which paid testament to the hard work that the team had put in. There had not been a day when the team were unable to offer a telephone response to the public.
Our Communications – this had been a year of change for the City Council’s Communication Team. Of the four people who began the year, only one remained. Luckily all three leavers had now been replaced and the team, since mid-March, was back operating at full capacity. ... view the full minutes text for item 6.
Clare Stait, Democratic Services Officer:
a) presented the draft work programme for 2020/21 as detailed at Appendix A of her report
b) advised that the work programme for the Performance Scrutiny Committee was put forward annually for approval by Council; the work programme was then regularly updated throughout the year in consultation with the Performance Scrutiny Committee and its Chair
c) reported that items had been scheduled in accordance with the existing work programme and officers’ guidance regarding the meetings at which the most up-to-date information could be reported to the committee; the work programme also included the list of portfolio holders under scrutiny
d) requested any relevant comments or changes to the proposed work programme for 2020/21.
RESOLVED that the work programme 2020/21 as detailed at Appendix A to the report be noted with the following amendments:
a) the Portfolio Holder for Our People and Resources be asked to attend the next meeting in August
b) the Portfolio Holders for Economic Growth, Housing and Customer Experience and Review to remain on the work programme with the Portfolio Holders for Reducing Inequality and Remarkable Place taken off unless deemed that they needed to be in attendance.