1 Summary

1.1 This report sets out for Members the latest budget monitoring based on spending to 22 August.

1 Revenue

1.1 The latest position is given in Appendix A. Overall the projected outturn is equal to the budget with the exception of pensions. There are several large variances within this and these are examined below.

1.2 Wholetime firefighters' pay and allowances (-£28,000) (-0.1%)

This underspending reflects marginally higher than anticipated staff turnover and vacancies. It assumes a 4% pay award being made. Every 1% above this would cost £103,000 in 2002/03 (£247,000 in 2003/04).

1.3 Non-uniformed pay (-£58,000) (-1.0%)

The implementation of station administrative support on stations has been delayed due to the reorganisation from divisional command to functional and group command structure (-£55,000).

1.4 Other employee expenses (+£38,000) (+4.3%)

Staff advertising has increased (+£35,000) due to higher turnover of staff and new posts.

Removal expenses are increasing (+£20,000) due to several senior posts expected to be filled externally with an impact on the costs of relocation including removals, renting accommodation and house moving fees.

Training expenses are lower than expected (-£30,000) due to the most appropriate training courses not being available. This is after the training budget is being partly used to purchase a multimedia presentation system for training delivery at stations.

1.5 Operational equipment (-£156,000) (-22.4%)

Expenditure has been reprioritised to meet the demand for uniforms and personal protective equipment (-£150,000).

1.6 Other supplies (+£303,000) (+20.0%)

Consultants' fees are higher than anticipated (+£39,000). A consultant has been used to advise HFRS during the recent pay and grading review process and during the appeal process to ensure consistency throughout, and a conflict management consultant has been assisting the Personnel Department with their team building and change programme.

There has been an increased demand for uniforms and personal protective equipment (+£150,000) due to more recruits than in an `average' year.

The former recruits' accommodation has been refurbished, resulting in increased expenditure on furniture (+£20,000).

Legal fees are projected to be over budget (+£44,000) as legal services provided by an external solicitor are costing more than was budgeted. The legal services provided are for employment law and employment related matters, including unfair dismissal and discrimination claims; public and employer liability, professional negligence and some personal injury claims; employment tribunals and employment appeal tribunals. Litigation and insurance work where we are not represented by our own insurers estimated at £20,000 will be met from the provision made in last year's accounts.

1.7 Income (-£142,000) (+20.8%)

The increased income comes from a variety of sources; Farnborough Air Show (-£35,000), increased income at Workshops (-£32,000), increased sales of old vehicles (-£24,000) and the issue of a fire certificate for a large shopping development (-£45,000).

2 Pensions (+£84,000) (+1.1%)

2.1 To date there have been 20 retirements compared with the 46 allowed for the full year in the budget.

2.2 It is now thought that although the total number of retirements will remain the same, different officers will retire than originally assumed increasing the lump sums by £169,000. This is offset by lower pension payments (-£115,000) due to fewer retirements in 2001/02 expected when setting this year's budget. . Employee contributions are expected to be £42,000 lower than budgeted.

2.3 Although it is currently predicted that the pensions' budget will overspend this is well within possible levels of fluctuations within the year. The level of overspend is approximately equal to 1.5 firefighters' lump sum payments. There is also some uncertainty over the level of transfer values both in and out which are both currently lower than anticipated.

3 Capital

3.1 Appendix B sets out the latest estimate of capital payments. It sets out the slippage from 2001/02 to 2002/03 and that estimated to slip from 2002/03 to 2003/04.

3.2 Work has started on the repairs to Copnor Fire station. It is expected that the work will be finished by the end of the financial year and within the £135,000 budget set for minimum repairs.

3.3 There are some changes to the total cost of schemes and these are also set out in Appendix B for members' approval. The major change is the deletion of the Training Centre SCA. This has to be used by 31 March 2003 and it is now clear this will not be achieved. If an extension is granted then the approval can be added back into the capital programme.

4 European Convention on Human Rights and The Human Rights Act 1998

4.1 The proposals within this report are compatible with the provision of the European Convention on Human Rights and The Human Rights Act 1998.

Recommendations

1 That this budget monitoring report be noted.

2 That the changes to the capital starts values set out in Appendix B be approved.

Section 100 D - Local Government Act 1972 - background papers

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

1. Published works.

2. Documents which disclose exempt or confidential information as defined in the Act.

TITLE FILE

Budget monitoring 2002/03 pp 3.33d

Appendix B

Capital Monitoring October 2002

1. Changes to starts values of existing schemes

2. Changes to payments 2002/03