Archived decisions

Agenda Item 7

Report to the

Transport for South Hampshire Joint Committee

Date: 17 October 2008

Report by: Peter Murnaghan

tel: 01962 846920 email: [email protected]

Subject: Transport for South Hampshire Financial matters - Performance and Progress

Purpose of the Report

This report provides an update for the Joint Committee on a number of financial matters:

(i) a periodic monitoring of the Transport for South Hampshire (TfSH) budget;

(ii) a measure of performance against the Business Plan for 2007-2009;

(iii) interim authorisation to the Project Director of TfSH;

(iv) the appointment of an Auditor for TfSH.

Recommendations

That the Joint Committee:

1. Notes the performance of the Revenue Budget for Transport for South Hampshire.

2. Notes the allocation by Partnership for Urban South Hampshire of £1.7 million New Growth Point funding towards the Transport for South Hampshire Capital programme.

3. Notes the performance against the approved Transport for South Hampshire Business Plan for 2007-2009.

4. Pending approval by the Joint Committee of Financial Protocols, gives approval for the Transport for South Hampshire Project Director to authorise revenue and capital expenditure provided this is within approved budget allocations and project approvals, and has been certified as accurate and legitimate by the relevant commissioning officer.

5. Notes the appointment of an Auditor for Transport for South Hampshire.

Introduction

1. In its role as a delivery agency, TfSH requires a robust process for the management of its financial affairs. Financial protocols are being prepared for Partnership for Urban South Hampshire (PUSH) and TfSH and the Joint Committee will be invited to approve this at its next meeting. Interim authorisation is being sought now. In addition, the approved budget and business plan have been monitored and are reported here for noting. The appointment of an Auditor is also reported.

TfSH budget monitoring

The TfSH revenue budget, approved by the Joint Committee on 14 April 2008 made provision for expenditure of £1.36 million, subject to the assembly of contributions from a variety of external sources. During the intervening months, a number of changes have been made, including a reduction in income from the New Growth Point funding and a reallocation by PUSH of funding from SEEDA and a delay in moving towards the assembly of an evidence base, leading to a number of third party contributions not being sought. On the other hand, unspent balances from the previous year provided a partial compensatory increase. As a result, the current budget figure is £1.17 million of which £603,000 has been spent or committed to date. This is broadly in line with a steady trajectory through the year. A copy of the latest budget outturn statement is attached as Appendix 1.

On the capital expenditure side, separate initiatives have arisen that are reported in greater detail elsewhere on the agenda. These include the allocation by PUSH of £1.7 million of New Growth Point funding for the current year to enable starts to be made on improvements to M27 Junction 5, design and construction of a link road to Tipner interchange and studies and preliminary design for access to strategic development sites. A further £8.3 million is earmarked as a provisional allocation to progress these three schemes over the ensuing two years to March 2011. In addition, the shortlisting of Bus Rapid Transit (BRT) for possible Community Infrastructure Funding (CIF) of £20 million has resulted in a great deal of work being expended to deliver a robust business case by late October, backed up by public consultation. This effort has been supported by an allocation of £500,000 from PUSH (included within the £1.7 million) to accelerate the BRT scheme preparation and advance mobilisation for the works, brought about by the CIF decision.

Officers have contributed to the PUSH Programme of Delivery for 2009-2011 with further bids for New Growth Point funding of transport capital projects. This document has recently been submitted to the Department for Communities and Local Government for consideration. A summary of the TfSH Capital funding bids from the range of sources is included as Appendix 2.

The delivery of these high profile schemes is placing pressure on the small core team of TfSH staff, which may warrant a review when the future year's budget is considered. A TfSH budget proposal for 2009/10 will be placed before the Joint Committee at its next meeting in January.

Performance against the Business Plan

A draft Business Plan for TfSH was approved by the Joint Committee on 16 October 2007, which was subsequently ratified by the three constituent highway authorities. This plan covers the two political (as opposed to financial) years June 2007 to May 2009. Since the plan was adopted, officers have been engaged in delivering the activities, within the resources available. It is timely to review the performance of the partnership against the Plan and a summary is attached as Appendix 3.

This shows the progress as at the end of September by means of indicators.

☼ indicates a start has been made on the activity, but more needs to be done.

☼☼indicates progress partially completed.

☼☼☼ indicates an activity largely completed.

In a small number of cases, no progress has been made, for a number of reasons.

Financial protocols

As the partnership moves along the road to delivery, it is necessary to formalise a process for approving projects carried out in the name of TfSH. Financial protocols, incorporating the process for committing capital and revenue expenditure are being prepared. The financial processes being proposed for TfSH will mirror very closely those of the Partnership for Urban South Hampshire (PUSH) which are due to be considered by their Joint Committee later in the year. Therefore pending consideration and approval of the Financial Protocols at the next meeting of this Joint Committee, authority is sought to establish an interim arrangement for the authorisation of revenue and capital expenditure. In order to enable expenditure to be authorised, within the budget allocations or project appraisals, it is proposed that the TfSH Project Director (or appropriate lead officer in the City Councils for capital expenditure) be delegated this responsibility and authorised to make such decisions on behalf of TfSH. To ensure that expenditure is properly incurred, it is proposed that the delegated authority shall only be exercised within the agreed budget or project allocations and only where the commissioning officer for the particular work has initially certified that the expenditure is legitimate in terms of work having been done or goods received, and that appropriate authority existed to incur such expenditure on behalf of TfSH.

Where capital expenditure is to be incurred, TfSH acts in the role of capital grant administering body. Having agreed a capital programme, Transport for South Hampshire will delegate to the Executive of the appropriate highway authority, the responsibility to prepare and submit the project appraisal for a particular project to the Joint Committee for approval.

The appointment of an Auditor for TfSH.

As TfSH, in a similar manner to PUSH, is a formally constituted Joint Committee comprising two or more local authorities, the Audit Commission has advised that it is required to appoint an auditor and to formally consult with the two partnerships. As Hampshire County Council is the lead financial authority for PUSH and TfSH, the Audit Commission advised TfSH of its intention to appoint the County Council's auditor Kate Handy (of the Audit Commission's in-house audit practice) as the committee's auditor. This appointment will cover the financial years 2008/09 up to 2011/12 and the County Council has accepted the Audit Commission's proposal.

1798Rpt/PM