Contact: Bevis Ingram, ext 7508

1 Introduction

1.1 This report presents the outturn for the 2003/04 financial year (year ended 31 March 2004) for approval by the Joint Management Committee. The report also shows, for information, the revenue budget for 2004/05, as agreed by the JMC in December 2003.

1 Overall Financial outturn

1.1 Appendix 1 shows the outturn for 2003/04, compared with the revised budget. There are some significant variations over the last few months of the year. The main reasons for these are as follows:

· A shortfall in sales/charges income (£22,600). This is principally due to further delays in the completion of restoration work.

· Additional costs associated with the fit out of the new tea rooms and furniture for the Granary and Dairy rooms (£12,400). These were not included in the capital scheme and have had to be met by the Park's revenue account. They may still be scope to approach the Recreation and Heritage Department of Hampshire County Council for a capital contribution towards this.

· Savings on employee costs by holding posts vacant and cutting back on employee related costs (£9,300).

· Additional contributions (recorded under `other income') from Hampshire County Council departments to pay for specific projects and activities (total £44,000). This has also meant further spending on those projects/activities, largely recorded as additional supplies and services expenditure (+£34,000), but also under other headings.

· Other minor variations explain the remaining differences with the revised budget.

1.2 Overall the deficit made by the Park has increased by £16,500 over that allowed for by the revised budget. In total the deficit made was £67,234, shown as follows:

	Revised budget	Outturn
	2003/04	2003/04
Expenditure	577,800	604,114
Income	318,600	329,637
Net Expenditure	259,200	274,477
Funding from Local Authority Partners	207,418	207,243
Deficit	51,782	67,234

1.3 The Park's reserves are now overdrawn by £16,502

1.4 The budget for 2004/05 set in December 2003 planned to make a small surplus (£5,500). This will now be insufficient to pay off the current deficit. In addition, the budget assumed that the new facilities would have opened before April 2004; at the time of writing (June 2004) the facilities are not yet fully open. This is likely to have a negative impact on the 2004/05 financial performance.

2 Financial Analysis

2.1 The report considered by the JMC in December 2003 included the follow targets for the Park's financial performance:

2004/05	Surplus sufficient to keep any deficit after matching funding paid to under £10,000
2005/06	Surplus sufficient to build reserves to £10,000
2006/07	Surplus sufficient to build reserves to £30,000

2.2 The deficit for 2003/04 means that the first of these targets (for 2004/05) is now even more unlikely to be met.

2.3 The Park is now overdrawn on its reserves and there is no immediate prospect of clearing this in the current financial year (2004/05). Although this is can be attributed to the one off factor of the major works being undertaken at the Park, and that these works should improve the long term business position pf the Park, this is still a serious financial problem that the JMC should address. The deficit is being held with Hampshire County Council who act as Treasurer for the JMC; at present the JMC is relying on the County Council's good will to allow the deficit to be incurred and now not be paid off until 2005/06, assuming no further capital contributions are forthcoming.

3 Visitor analysis

3.1 The following table shows visitor and shop figures for the past two years.

2002/03: 68,361 generated gate receipts of £189,681 (average: £2.77)

2003/04: 67,321 generated gate receipts of £179,509 (average: £2.67)

2002/03: 68,361 generated shop receipts of £20,475 (average: £0.30)

2003/04: 67,321 generated shop receipts of £19,782 (average: £0.29)

3.2 Visitor numbers have held up despite the lack of completed facilities, due to free days, 2 for 1 offers and discounts. This has maintained the interest and involvement in the Park, but at a cost of lower gate receipts - effectively the special offers have largely cancelled out the fall in visitor numbers due to the incomplete facilities. This probably indicates that visitor numbers are price sensitive; the alternative analysis - that the number of visitors is largely unaffected by either the special offer prices and the incomplete facilities seems unlikely. Had the visitors in 2003/04 paid the 2002/03 average price (£2.77), income for entrance charges would have been higher by nearly £7,000.

3.3 Net income per head in the shop was virtually unchanged suggesting that once people are through the door they will spend in the shop regardless of what other attractions are on offer. Efforts will continue to be made to maximise income from shop sales in the future.

Recommendations

1 That the financial outturn for 2003/04 be approved

2 That the Officer Group be instructed to present proposals to the next meeting of the JMC on a business plan for the Park which includes eliminating the deficit in the Park's accounts.

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:

Published works.

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

TITLE FILE

Appendix A

Sir George Staunton Country Park Final Accounts 2003/04

Appendix B

Sir George Staunton Country Park Forward Budget 2004/05