Hampshire County Council

Recreation and Heritage Policy Review Committee Item 7

18 November 2004

Executive Member - Recreation & Heritage Item 6

18 November 2004

Budget Monitoring 2004/05

Report of the County Treasurer and Director of Recreation & Heritage

Contact: Bevis Ingram 01962 847508 email: [email protected]

Stuart Dorward 01962 846110 email: [email protected]

1. Introduction

1.1 This report provides an update on the financial position reported in September and also presents monitoring information on progress against workforce plan and performance indicator targets.

1.2 Based on activity to the end of September there is a potential overspend of £404,000 on the revenue budget. Management action has been and will continue to be taken to ensure that actual spending for the current year is brought back in line with the budget. The further requirement for £250,000 of additional expenditure on books and other materials for new and refurbished libraries will be accommodated by deferring to 2005/06 part of this year's planned transfer from revenue to capital.

2. 2004/05 Budgetary Position

2.1 The September report indicated that an overspend of £354,000 was likely without further management action. The additional need to provide new loan materials this year for new and refurbished libraries added a further £250,000 to the pressures on the budget, giving a total potential overspend of £604,000. The main financial issues were in the Library and Information Service, where total pressures of £1.1 million were being experienced. Management action already in hand was expected to limit this to £0.5 million. The balance of the forecast overspending (£104,000) arose from pressures in other services.

2.2 The Library and Information Service is currently forecasting an overspend of £450,000. This represents an improvement of £50,000 compared with the position reported in September. However, this is offset by an emerging pressure of approximately £100,000 on ICT equipment and services arising from the extensive roll-out of IT2000 to the Department's sites. The potential overspend therefore currently stands at £404,000.

2.3 Faced with these pressures the Departmental Management Team has agreed and implemented a series of measures to bring spending back in line with the budget. These measures include freezing part of the revenue funded capital programme provision for Discovery Centres and library refurbishments (made possible by the extended timescale of the Havant scheme), deferring spending on specific items and setting savings targets for all services. These targets will be met through variety of actions e.g. applying strict criteria to filling vacant posts and to the commissioning of design work and publications.

2.4 In summary, the current position and proposed actions are as follows:

2.5 The contract for the new accommodation block at Calshot Activities Centre has now been let. The total cost of the scheme at the project appraisal stage was £1.21million, which required the Centre to take on and fully service a prudential borrowing arrangement of £490,000. The contract sum, including fees and the additional cost of the sprinkler installation, is £1.227 million , requiring borrowing of £507,000. In order to reduce the ongoing annual financial commitment to service this borrowing, the Centre proposes to transfer available sums from revenue to capital in 2004/05, 2005/06 and 2006/07. On the basis of current projections, savings on the Centre's minor works and equipment budget together with improved income from the climbing walls are expected to result in a net underspending of £65,000. It is proposed that the underspending target for 2004/05 is quantified in January and factored into the budget process.

2.6 For the purposes of this report, it has been assumed that £65,000 will be transferred from the revenue budget to capital in support of the accommodation block project. The net transfer from capital to revenue shown in Appendix 1 is therefore £339,000 (the £404,000 detailed in paragraph 2.4 less the £65,000 for Calshot).

2.7 A report elsewhere on the agenda puts forward proposals for capital developments at the Welsh Mountain Centre. It is proposed to part fund these developments by planning to make further savings in the current year in the Sport, Community and Outdoor service and then seeking approval in the January budget report to carry forward any consequent underspend to 2005/06.

2.8 Since September, an increase to the cash limit of £80,000 has been approved. However, this mainly relates to technical adjustments and items already reflected in the earlier budget monitoring. There is not, therefore, an increase in Recreation and Heritage's spending power. The changes to the budget are summarised in Appendix 1, which shows the budget position summarised for the whole department. Appendix 2 shows the details for each individual service.

3 Workforce Plan

3.1 The Recreation and Heritage Workforce Plan for 2004/05 was considered by the Policy Review Committee and approved by the Executive Member on 13 May 2004. This looked at a range of factors affecting the workforce and contained a number of proposals for changes in the staffing of the Recreation and Heritage Department. These were subsequently approved by Cabinet.

3.2 The strategic review in the Library and Information Service is now complete and new staffing structures are in place. 17 libraries are scheduled to open longer this financial year (a total of an additional 75 hours per week). The new Alton library and Odiham Bridewell have been opened and the Discovery Centre Manager for Gosport is now in post.

3.3 Staffing changes resulting from the Countryside Service review are now largely complete, including recruitment to new posts required to meet duties arising from the Countryside and Rights of Way Act.

3.4 Recruitment is largely complete to new posts in the Museums Service for the South East Regional Museums Hub, funded wholly by the Museum, Library and Archives Council's "Renaissance in the Regions" programme.

3.5 The structure of the finance team that supports Recreation and Heritage and some of the central departments of the County Council has been reviewed. Recruitment of a SAP Support Officer will be delayed until next year pending implementation of changes resulting from this review.

3.6 In summary, Recreation and Heritage has continued to progress service improvements this year through new and changed posts. These have been approved by the Leader and Cabinet and funded through new or redirected resources approved as part of the 2004/05 budget.

4 Performance Indicators

4.1 Appendix 3 sets out the latest position on key cultural services performance indicators and targets contained in the County Council's Corporate Strategy and Performance Plan. The Corporate Strategy contains four targets specific to Recreation and Heritage. Monitoring data is available for three of these and shows good progress.

4.2 The Performance Plan targets relate solely to Best Value Performance Indicators. Again, the monitoring data show a generally satisfactory position. These are significant for the cultural services block of the Corporate Performance Assessment.

5 Conclusions

5.1 There continue to be considerable pressures on Recreation and Heritage revenue budgets. The management action being implemented will address the majority of these, but it is likely that it will be necessary to defer the transfer of funds from revenue to capital to achieve a balanced position. Meanwhile all efforts will be made to identify further savings opportunities.

Recommendations

That the proposals set out below be supported and submitted to the Executive Member for Recreation and Heritage for his consideration:

(i) that the financial position be noted

(ii) that the continuing action being taken to restrict the overspend be endorsed

(iii) that the proposal to use the underspend at Calshot Activities Centre to reduce the borrowing requirement be noted.

Section 100 D - Local Government Act 1972 - Background Documents

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 Location

Recreation and Heritage

Corporate Strategy Targets (specific to Recreation and Heritage)

Performance Plan Targets

Note: The 2004/05 full year projection is, apart from BV178, a straight line extrapolation of the year to date figures in the preceding column.