Hampshire County Council

Buildings Land and Procurement Panel Item

5 April 2005

Revenue Maintenance Budget 2004/5 and 2005/06

Report by the Director of Property, Business and Regulatory Services

How the conclusion in this report fits with the Corporate Strategy

The activities covered by this report affect the majority of the County Council's services, contributing to the achievement of all the corporate aims, in particular:

Aim 1 - maximising life opportunities - by maintaining the built estate to a high

standard for the community to enjoy

Aim 5 - improving services - by providing well maintained premises that enable

improved service delivery

1

Summary

1.1

The purpose of this report is to update Panel members on the revenue budget position for the current financial year, and to propose the allocation of the budget for 2005/6 in line with the strategy report earlier on the agenda.

2

Revenue budget 2004/05

2.1

Appendix 1 shows the level of commitment against the revised budget for 2004/5. The revised budget figure of £12.669m will be fully spent by the end of the financial year.

2.2

By the middle of March, the total level of commitment was 98.8% However, two elements of the budget are delegated to schools and are not within the control of this Panel. These budgets relate to minor repairs which are arranged directly by schools, and delegation to those foundation schools who have not entered into buy back arrangements with Property Services (all Community Schools have entered into the buy back arrangements with Property Services). When only those budgets within Panel's control are included in the calculation, the level of commitment is in line with expectations.

2.3

By the end of February, most of the winter contingency of £324,000 had been spent against engineering servicing and repairs. This is an annual contingency provision in case of a severe winter, and unspent elements are carried forward to the following financial year. Despite the relatively late cold weather this winter, it is likely that a small element of the contingency will remain unused, and it is recommended that this should be carried forward to 2005/06.

2.4

The major commitment against the revenue budgets relates to the four engineering term maintenance contracts. These account for £5.3m (42%) of the budgets, and it is currently estimated that spending on these contracts will be almost exactly in line with budget.

3

Revenue Budget 2005/06

3.1

The original budget for 2004/05 was £12.565m, and in line with the County Council's budget strategy, inflation of 2.5% has been included in the forward budget for 2005/06. As in previous years, the true cost of inflation in this area at around 6% is significantly higher than the allocation. As a result of the passporting arrangements, a further £313,000 has been added to the revenue repairs budget and a sum equivalent to the inflation shortfall, giving a total budget of £13.258m. In line with the Council's annual efficiency savings, the revised budget has been reduced by £71,000. Given the nature of this budget, with over 40% committed to long term contracts and the annual delegation to schools, it is difficult to see where opportunities for further efficiencies could arise.

3.2

Proposed allocations for 2005/06 are shown in Appendix 2. The general approach has been to increase schools' allocations by the 2.5% inflation allowance and by the passporting provision, with other allocations generally reflecting the 2.5% increase.

4

Conclusion

4.1

It is estimated that actual expenditure in 2004/05 will be very close to the approved budget, although this will depend on the extent to which the winter contingency is utilised. Any unused balance should be carried forward to 2004/05. The approved budget for 2005/06 will not maintain the current year's spending power due to the inadequate allowance for inflation and application of corporate efficiency savings.

Recommendation(s)

That the Panel advises the Executive Member for Policy Resources that approval be given to:

1

Any uncommitted element of the winter contingency being carried forward to 2005/06.

2

The budget allocations for 2005/06 as set out in Appendix 2.

P&R Revenue Maintenance - 2004/05

Budget £'000

Commitment £'000

Percentage

a) Non-Education Services

Redecorations

510

521

102.2%

Engineering servicing and repairs

1,639

1,764

111.3%

Minor structural repairs

590

629

106.6%

Asbestos testing

40

57

142.5%

Vandalism reinstatement

100

118

118.0%

Sub Total

2,879

3,089

109.3%

Contingency

* 300

324

0.0%

b) Delegated to schools

Delegation under LMS scheme

2,140

2,240

100.0%

Delegation under fair funding:

Community Schools

5,830

5,483

94.5%

Foundation Schools

810

767

100.0%

Sub Total

8,780

8,490

96.3%

c) Other Allocations

Strategic consultants

370

407

110.0%

Non functional buildings

100

31

31.0%

Devolved to other services

240

176

73.3%

Sub Total

710

614

86.5%

Total

12,669

12,517

98.8%

Budget

Proposed

Allocation

Allocation

2004/05

2005/06

£'000

£'000

Non-Education Services

Redecorations

510

525

Engineering Servicing & Repairs

1,639

1,625

Minor Structural Repairs

590

555

Asbestos Testing

40

40

Vandalism Reinstatement

100

105

Sub Total

2,879

2,850

Contingency

300

375

Delegated to schools

LMS Delegation

2,140

2,194

Fair Funding Delegation

Community Schools

5,830

6,251

Foundation Schools

810

868

Sub Total

8,780

9,313

Other Allocations

Strategic Consultants

370

380

Non Functional Buildings

100

100

Devolved to Other Services

240

240

Sub Total

710

720

Total

12,669

13,258