Contact : Paddy Hillary, Ext: 7391 e-mail: [email protected]
Jill Lovelock, Ext: 7591 e-mail: [email protected]

1. Summary

1.1. Negotiations have been continuing with government on the targets and stretched performance for the LPSA2. The final agreement was submitted to Ministers on 3 February 2006. This report provides Cabinet with the final LPSA2 document submitted to Ministers and arrangements for managing the pump priming and reward grants and performance monitoring alongside the Local Area Agreement.

1.2. The LPSA1 agreement ended on 31 March 2005 and a final claim for performance reward grant of £10, 687,099 was submitted in December 2005. This report updates Cabinet on the arrangements for receiving and allocating reward grant over the next 2 financial years.

2. Introduction

2.1. Cabinet have previously agreed the framework and targets for the LPSA2 which has been negotiated with government in partnership with District Councils, voluntary sector, health, police, fire and other partners. The attached schedule gives the final LPSA2 submitted to Ministers on 3 February.

2.2. Cabinet are reminded that the process for LPSAs has been subsumed within the Local Area Agreement process. In Hampshire we have continued to develop the LPSA separately as discussions had started some 18 months ago. Timing is such that we will conclude both the LPSA and Local Area Agreement in February and, although the LPSA2 starts immediately, the 2 agreements will come together for performance management purposes.

3. LPSA2

3.1. The final LPSA2 agreement includes 16 targets covering the priority areas of removing barriers to employment; feeling safe; healthier communities and environment.

These targets have been included in the Local Area Agreement development as the stretch element. The results will be monitored as part of the Local Area Agreement performance management framework and reported through the Local Area Agreement Executive and Board.

3.2. Management arrangements for handling the pump priming and performance reward grants have been agreed by the LPSA partners.

Hampshire gets a total of £2,001,030 pump priming (set by formula of £750k plus £1 per head of population). The partners agreed to top slice a 10% contingency and to cover the costs of the MORI survey (£60k) leaving £1,740,927. Target leads are working on the basis of £100k per target and so with 16 targets there will be £140,927 to allocate against bids or to offer more per target. The partnership will decide this at the next meeting in February. The pump priming grant will be released as soon as the agreement is signed.

3.3. The performance reward grant is based on 2.5% of the County Council's net budget and is therefore a maximum of £27,696,625. The partners agreed a basic formula for allocation of reward grant :

- 5% top sliced allocated to all level 3 partners (one share per partner regardless of no. of targets they support)
- 95% allocated to targets
- 10% of each target grant to level 1 partners (leads)
- 90% of target grant split between level 1 & 2 partners

This is the standard position but partners can agree among themselves a more appropriate allocation to reflect input.

4. Additionally, it was agreed that there should be a sub agreement for each target signed by all partners setting out:-
- lead partner
- other partners & levels of commitment
- actions & timescales
- pump priming grant allocations
- reward grant allocation.

These sub agreements will be finalised during February once the main agreement has been signed.

4.1 The agreement will be signed by the relevant Ministers for the government and
the Leader of the County Council the Chief Executive and on behalf of the Hampshire partners. Details of the signing arrangements are to be agreed.

4 LPSA1 - reward grant claim

4.1 Cabinet will recall that the LPSA 1 ended in March 2005. An audit of the final results has been carried out by Treasurers Consultancy to verify the figures and a final claim of £10,687,099 submitted to ODPM in December.

4.2 The make up of the claim is as follows:

Education - 3 targets at less than the full % agreed: 5+ GCSE A*-C in areas of relative deprivation; unauthorised absence in secondary schools in targeted areas and permanent exclusions in Gosport schools making a total of £1,605,243

Adult Services - 1 target at less than the full %: independence of older people making a total of £703,760.

Children's Services - 1 target at the full %: No of LAC in permanent placements including friends and family placements making £1,675,619

Environment - 3 targets at the full %: diversion of waste from landfill, reduction in fatal and serious casualties and condition of roads making a total of £5,026, 857

Corporate - the compulsory cost effectiveness target at the full % earning £1, 675,619

4.3 The claims in respect of the targets for older people and road conditions are subject to some local assumptions that may not be agreed by ODPM. The older people target was based originally on performance indicators that changed significantly over the period of the LPSA mainly due to the reorganisations in the NHS and changes to the systems for managing delayed discharges from hospitals. The road condition target has also had issues in respect of measurement methodology and interpretation of the original agreement. The final claim is based on the County Council's view of our performance and the auditor has reported that this view is sound based on the figures. We will need to wait to see if the ODPM agree to find out whether we will get the full claim.

4.4 Cabinet agreed in July 2005 that the reward grant earned should be allocated as follows:
- development of the Local Area Agreement - £1,500,000
- repayment of unsupported borrowing - £2,250,000
- remainder allocated to departments in line with earnings - £6,937,099

4.5 We are currently awaiting a response from ODPM to the claim which, if agreed, will be paid in 2 equal tranches in this and the next financial years.

Recommendations

1. That Cabinet agree the final LPSA2 as submitted to Ministers for the Leader to sign on behalf of the Hampshire partners.

2. That Cabinet supports the management arrangements for pump priming and rewards grants and form monitoring.

3. That Cabinet welcomes the success achieved in LPSA1.

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.

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