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, but expected to be fully repaid in 2008/09.

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. Planned underspendings of £2,430,000 in 2007/08 to be used to finance spending in 2008/09.

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 2007/08 and 2008/09.

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 reduce to £5.2m by 31 March 2008, with no further major fire reinstatement costs outstanding that are due to be funded from the reserve.

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. Proposed in 2008/09 Budget to extend its purpose to assist in managing the policy of not taking up supported borrowing in full and to earmark resources for potential strategic property investments.

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. Balance at 31 March 2008 estimated at £1.4m to which a further contribution is planned

Job evaluation transitional costs

To assist in meeting transitional salary protection costs and equal pay claim 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 £10.0m made to the reserve in 2007/08 from underspendings anticipated in 2008/09. After allowing for project team and implementation costs to be funded from the reserve in 2007/08 and 2008/09, the balance on the reserve is approximately £30m.

Grant equalisation

To assist in managing the impact of future grant loss arising from 2006/07 formula changes, and subsequent changes to the formula in 2008/09.

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. With grant loss commencing in 2008/09, proposed to utilise the reserve to phase the impact on council tax of grant loss over six years to 2013/14, the earliest date at which the County Council might reach the grant floor.

Landfill allowances

A newly established reserve in 2005/06 to which income from the sale of landfill allowances is 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. Income from sale of allowances in 2007/08 expected to increase the reserve to £4.0m by 31 March 2008.

Invest to save and modernisation

A proposed new earmarked reserve in the 2008/09 budget combining the two existing invest to save reserves, one of which originally established to fund improvements solely in 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 Leader and Cabinet.

Use to be subject to the production of specific business cases. A contribution of £3.3m to the reserve is proposed in 2008/09, partly to fund investment in the foster care service.

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 £313,000 at 31 March 2009.