Reserve

Purpose

Use of reserve

Management and control

Review process

Schools

Earmarking of the balance of unspent delegated budgets

1

To supplement school's budget share, to finance capital contributions and to provide a contingency

Responsibility of headteacher and school governing body.

In addition to review by individual governing body, trends reviewed annually by Children's Services executive member.

2

Up to 25% of total reserve made available on a loan basis to finance school capital projects of an `invest to save' nature. £5.0m has been advanced under this scheme.

Proposals subject to approval of the capital programme, involving executive member, Cabinet and County Council approval.

Use of loan scheme subject to appraisal of projects and to 25% upper limit.

Trading units

To enable business units to carry forward planned surpluses.

To meet future deficits and/or restructuring costs, to fund capital investment or to return surpluses to customers by reducing prices.

By responsible Chief Officer subject to executive member approval.

Through production of an annual business plan linked to the budget process.

Service underspendings.

To enable services to carry forward 100% of planned underspendings and at least 50% of unplanned underspendings

To fund non-recurring expenditure in future years or to phase in the requirement for additional funding or to achieve savings.

By service Chief Officer reporting to the Executive member. Cabinet responsible for approval of cases where more than 50% of a saving is earmarked.

Reviewed annually as part of budget cycle. £528,000 of projected balance of £698,000 at 1 April 2007, due to be used to finance spending in 2007/08.

Change for Children

New reserve to progress the Change for Children agenda.

An investment fund to pump prime service improvements to deliver the five outcomes of the Children's Act.

By director of Children Services subject to executive member approval.

Transfers of £54k to reserve proposed in 2006/07 and 2007/08.

Insurance

To cover fire, flood and storm damage reinstatement costs which are already committed and to reserve against adverse trends in liability claims.

To supplement annual `premiums' charged to services.

Chief Executive and County Treasurer subject to Cabinet approval.

At least annually on closure of accounts. Reserve balance expected to decline to £3.2m by 31 March 2008 due to current level of fire damage commitments.

Second homes income

Agreed to earmark additional council tax income from reducing the discount on second homes in 2004/05 for purposes agreed with the relevant district council.

To fund expenditure in future years on the agreed projects, mainly affordable housing.

By County Treasurer subject to Cabinet approval

Reviewed at least twice yearly on closure of the accounts and in setting the budget. Affordable housing schemes in New Forest, East Hampshire, Test Valley and Winchester are planned to utilize the reserve balance.

General capital

To assist in matching the timing of the availability of capital financing resources with the timing of capital payments

To finance locally-resourced capital expenditure

By County Treasurer in conjunction with decisions on the financing of the capital programme

Reviewed at least twice yearly on closure of the accounts and in approving a new capital programme. Reserve fully utilised in funding 2005/06's capital expenditure.

Job evaluation transitional costs

To assist in meeting transitional salary protection costs likely to arise from implementation of the Pay and Benefits review.

To supplement employee budgets in transitional period following implementation and to finance non-recurring implementation costs.

County Treasurer subject to Cabinet approval.

A contribution of £7.5m made to the reserve in 2006/07 from resources originally earmarked for implementation of the new pay structure in 2006/07. After allowing for project team and implementation costs to be funded from the reserve in 2007/08, the balance on the reserve is £17m.

Grant equalisation/Comprehensive Spending Review 2007

To assist in managing the impact of future grant loss arising from future grant loss as a result of the 2006/07 formula changes, and the implications of CSR 2007 on Hampshire's grant.

To compensate for service and/or council tax impact of grant loss

County Treasurer subject to Cabinet approval

Revised in each year's budget planning. Further contributions of £1.2m in both 2006/07 and 2007/08 are planned on the basis that the reserve is likely to be utilised over the three year period following Spending Review 2007.

Landfill allowances

A newly established reserve in 2005/06 to which income from the sale of landfill allowances will be transferred.

Cabinet have agreed the principle that 40% of the income should be utilised subject to the approval of business cases, to finance investment in waste facilities to enable landfill and recycling targets to be met. The remaining 60% will be used to offset the costs of the waste management contact, the increased cost of which has been financed corporately.

County Treasurer and Director of Environment, subject to approval of the Leader and Cabinet.

Reviewed as part of budget and final accounts process. £3m withdrawn from the reserve in 2006/07 as part of the package of measures to reinstate balances. Income from sale of allowances in 2006/07 and 2007/08 expected to increase the reserve to £4.3m by 31 March 2008.

Adult and Children's Services invest to save

A proposed new earmarked reserve in 2007/08 budget to fund improvement to Adult and Children's Services.

To fund improvements which will transform service provision and improve value for money from 2008/09 onwards.

Chief Executive and County Treasurer, subject to the approval of the executive member, Policy and Resources.

Use to be subject to the production of specific business cases. A contribution of £0.7m to the reserve is proposed in 2007/08.

PSA reward grant

A reserve established in 2005/06 to earmark the £9.9m reward grant received in respect of LPSA 1 targets.

£1.5m earmarked to pump prime the Local Area agreement. £2.3m to repay unsupported borrowing incurred in respect of LPSAI, £1.5m for Home to School transport initiatives, £1m in respect of well-being and £3.6m for priorities identified by Environment and Children's Services in respect of grant relating to their targets.

Proposals subject to approval of Leader and Cabinet.

Decisions taken during the course of 2006/07 to utilise the reserve over the period to 2008/09.

Segensworth unit factories

To enable annual tenant contributions towards repairs to be earmarked for periodic major repair liabilities to infrastructure.

To fund maintenance of specific significant infrastructure costs which are the responsibility of the County Council as freeholder.

Director of Property, Business and Regulatory Services subject to terms of relevant agreement.

Reserve is ring-fenced.

Other minor reserves

Sums set aside for specific future purposes.

To fund spending on specified purpose.

Various.

Reviewed at least annually on closure of the accounts. Overall balance projected at £117,000 at 31 March 2008.