Revenue and capital budget monitoring report 2009/10 – Period 11

Report: 05
Date: 22 April 2010
By: Director of Resources on behalf of the Commissioner

Summary

This report provides an update on the revenue and capital budget monitoring position for 2009/10 at Period 11 (to the end of February). The revenue budget is forecast to overspend by £3.9m (approximately 0.1% of budget).

The Capital Programme as at Period 11 (to the end of February) shows year to date total expenditure of £137.9m. This total represents 64.4% of the revised annual budget of £214m. The forecast for the year of £186.1m is £27.9m below the revised annual budget.

A. Recommendations

Members are invited to: Note the year to date and forecast position for revenue and capital budgets.

B. Supporting information

Background

1. This report provides an update on the forecast against the revenue and capital budgets for the MPA/MPS in 2009/10 based on the position at the end of February 2010.

Revenue Forecast by Business Group

2. Table 1 provides a summary of the revenue forecast by Business Group. Table 2 compares the forecast outturn variances for Period 11 and Period 10 by Business Group.

3. The forecast does not yet account for any additional costs incurred as a result of the recent industrial action by members of the public sector relating to changes to redundancy entitlements. Current indications are that some 1,300 strike days were recorded during the recent industrial action and, whilst overtime costs were incurred to cover for absent staff, salary payments to staff taking part in industrial action will be withheld. The financial impact of the action will be included as part of the reported outturn position.

Table 1 – Summary of revenue forecast against budget at Period 11

* % of net expenditure budget

Table 2 - Comparison of Period 11 forecast outturn variance with Period 10 forecast outturn variance.

5. The subjective position by Business Group is at Appendix 1. The overall position for the MPS is at Appendix 2.

6. Territorial Policing – An overspend of £25.4m – 1.8% of Budget.
The forecast overspend relates principally to: Police Officer Pay as a result of the current strength being higher than anticipated due to Police Officers not moving to other Business Groups as originally planned (despite them holding vacancies and reporting underspends in this area) and shortages in some units, ranks and roles in Territorial Policing which also limit movement; Police Officer Overtime caused by the policing of the G20 and Tamil demonstrations; PCSO Pay where the movement of PCSOs into other roles is being managed to avoid vacancies; Police Staff Pay caused by delays to the implementation of Integrated Prosecution Teams (IPT) and delays to Finance & Resource Manager modernisation; Transport Costs relating to additional vehicle hire and increased fuel costs; Income where there have been reductions in immigration receipts as the UK Borders Agency makes less use of MPS custody facilities as well as lower than budgeted local authority funding for cost sharing initiatives.

7. There has been a favourable movement of £1.9m in the forecast position from that reported at Period 10 relating principally to Supplies and Services following reviews of expected activity prior to year end. There has also been a favourable movement of £1.1m in Police Officer Overtime following reviews of anticipated activity. These have been partly offset by an adverse movement of £1.3m in the Police Officer Pay forecast, relating principally to National Insurance costs linked to Special Priority Payments unaccounted for in previous forecasts.

8. Specialist Crime – An underspend of £2.8m – 0.7% of Budget.
The forecast underspend is principally within Police Officer Pay where strength is below target and an over achievement of Other Income mainly as a result of additional POCA receipts. This is partially offset by a forecast overspend on Police Staff Pay primarily caused by forensic services recruiting ahead of their original plans. There are also overspends forecast within Police Officer Overtime and Police Staff Overtime, principally relating to covering for vacancies as well as an increase in gun related crimes.

9. There has been a minor favourable movement of £0.2m in the forecast position from that reported at Period 10.

10. Specialist Operations – An overspend of £0.3m - 0.1% of Budget.
Whilst the overall position is for a minor overspend, there are subjective variances, principally within Police Officer Pay, Police Staff Pay and PCSO Pay. Lower than planned workforce levels at Heathrow Airport and the Palace of Westminster are matched by an under-recovery of income in these areas. There is an underspend within Transport costs which relates to reduced spending on overseas travel. Overspends are forecast within Police Officer Overtime due to covering vacancies and additional Protection requirements and within Supplies and Services relating to Counter Terrorism expenditure.

11. There has been a minor adverse movement of £0.3m in the forecast position from that reported at Period 10.

12. Central Operations – An underspend of £0.3m – 0.1% of budget.
The forecast underspend relates principally to Police Officer Pay as officer numbers are below target strength. This is mostly offset by overspends in the following areas; Police Officer Overtime caused by the policing of the G20, Tamil and Climate Camp demonstrations; Transport Costs relating to additional Public Order vehicle hire resulting from the demonstrations, increasing fuel costs and unfavourable exchange rates relating to services purchased by the Air Support Unit (helicopter maintenance); Employee Related Expenditure relating to seconded officers used for Public Order Aid; Supplies and Services relating to increased firearms and Taser training as well as additional equine costs; an under-recovery of income forecast for sporting events.

13. There has been a favourable movement of £1.2m in the forecast position from that reported at Period 10, principally following reviews of Police Officer Pay and a continued reduction in Police Officer Overtime expectations.

14. Olympics Security – Nil variance.

15. Deputy Commissioner’s Portfolio – An underspend of £1.3m – 2.4% of budget.
The forecast underspend relates principally to Police Officer Pay due to officer numbers being below target strength. An over recovery of income is also forecast relating to work carried out by MPS staff on behalf of the Cayman Islands. The ability of the Service to recover these costs is, however, being kept under review.

16. There has been an adverse movement of £0.3m in the forecast position from that reported at Period 10 relating to the cost of the HMIC Review of Policing Public Protest.

17. Directorate of Public Affairs – An underspend of £0.4m - 6.8% of budget.
The underspend is principally within Supplies and Services relating to reduced publicity expenditure and Police Staff Pay due to vacancies carried throughout the year.

18. There has been a minor favourable movement of £0.1m in the forecast position from that reported at Period 10.

19. Directorate of Information – An underspend of £0.1m - 0.0% of budget.
Whilst the overall position is for a minor underspend, there are subjective variances in the following areas; Police Officer Pay and Police Staff Pay are both underspent by £0.9m and £1.3m respectively, due to vacancies carried throughout the year; Supplies and Services is overspent by £2.6m due to a variety of reasons such as increased demand for evidential analysis, additional workstation support costs, growth in data storage, new applications, services and associated licences; there is an over-recovery of income of £0.9m from a variety of sources.

20. There has been a minor favourable movement of £0.3m in the forecast position from that reported at Period 10.

21. Resources Directorate – An underspend of £0.9m – 0.3% of budget.
Whilst the overall position forecasts a small underspend, there are a number of subjective variances. Police Staff Pay forecasts an underspend of £1.6m principally within Property Services reflecting a reduction in the use of agency staff and preparations for restructuring which will yield permanent savings; Employee Related Expenditure forecasts an underspend of £2.7m principally resulting from a reduced tax liability on free rail travel (offset by the additional cost of free rail travel recorded within Human Resources Directorate); Premises costs forecasts an overspend of £3.5m relating to additional facilities management and utilities costs; Capital Financing forecasts an underspend of £1.5m linked to a lower than budgeted Capital Financing requirement; Interest Receipts forecasts an under-recovery of £3.3m following inclusion of an anticipated £2m write-off of penalty interest relating to Landsbanki investments that had previously been accrued in 2008/09 on the advice of Cipfa. Additionally, there has been a reduction in the level of interest rates achievable on investments reflecting changes to the Authority’s Treasury Management policy; Specific Grant forecasts an over-achievement of £1.6m relating to additional Loan Charges grant resulting from a lower balance of useable capital receipts (due to the need to use significant levels of usable capital receipts to finance the Capital Programme in 2008/09).

22. There has been a favourable movement of £1.4m in the forecast position from that reported at Period 10 relating principally to forecast reductions for operational support costs in Property Services Department, reduced Capital Financing costs where borrowing has been undertaken later in the year than previously anticipated and additional Income relating to increased rental income and service charges.

23. Human Resources – An underspend of £3.2m – 1.9% of budget.
The forecast underspend is principally within Police Staff Pay relating to existing vacancies within the Transforming HR Programme and Police Staff overtime, principally within Catering Services where more efficient working practices have reduced the requirement for overtime. The underspend is partially offset by an overspend in Employee Related Expenditure which relates to the forecast cost of delays to the Transforming HR Programme.

24. There has been a minor favourable movement of £0.1m in the forecast position from that reported at Period 10.

25. Metropolitan Police Authority – Nil variance.
The full year forecast position is equivalent to budget following the use of MPA reserves to cover extraordinary Employee Related Expenditure and Legal costs. Employee Related Expenditure incorporates non controllable costs of the MPA in respect of ACPO recruitment where more recruitment drives were needed than planned, and ill health retirement costs. This budget also includes final staff payments relating to the MPA reorganisation; the cost of secondments; and early retirement costs. There is a small underspend in Police Staff pay mainly due to vacancies throughout the year and an element is due to the recent reorganisation but extra costs are incurred in respect of the reorganisation as described above.

26. The forecast position has remained in line with that reported at Period 10.

27. Centrally Held Budgets – An underspend of £17m - 0.6% of Budget.
The underspend principally relates to Police Officer Pay where the decision taken at the MPA Remuneration Sub-Committee on 21 December with regard to Special Priority Payments (SPPs) has been recognised. The expected budget savings have been moved from Business Groups to Centrally Held and reduced forecasts have been entered by the affected Business Groups. The underspend also relates to accounting adjustments to write off unmatched goods receipts in respect of previous financial years and includes receipt of a grant payment of £3.6m from Home Office relating to reimbursement of additional costs incurred as a result of the G20 summit.

28. There has been a minor adverse movement of £0.1m from the position reported at Period 10.

29. Discretionary Pension Costs – An overspend of £4.2m – 14.4% of budget.
The forecast overspend is principally due to a higher number of ill health retirements than had originally been anticipated as well as increased payments for injury awards and 30+ pensions. This category of expenditure is particularly difficult to forecast and budget growth of an additional £1m in 2010/11 rising to £3m in 2012/13, to increase this budget to £32.1m, has been built into the Business Plan to address the growth in payments. The future management of discretionary pension budgets is currently under discussion with Human Resources Directorate.

30. There has been an adverse movement of £1.2m from the position reported at Period 10 relating principally to identifying additional 30+ pension costs and additional ill health retirements.

Revenue Forecast variance by expenditure/income type

31. Table 3 compares the forecast outturn variances for Period 11 and Period 10 by expenditure/income type.

Table 3 – Comparison of forecast outturn variance by expenditure/income type

32. Police Officer Pay – An underspend of £16.2m – 0.9% of budget.
The forecast underspend relates generally to actual and anticipated vacancies across a number of Business Groups, except for Territorial Policing where the current and forecast strength are higher than anticipated due to Police Officers not moving to other Business Groups as originally planned. Elsewhere, average strengths throughout the year have been below target, principally caused by the ongoing impact of the deferment of recruits planned for March 2009 into April. The forecast also recognises the decision taken at the MPA Remuneration Sub-Committee on 21 December with regard to reducing the cost of Special Priority Payments. Table 4 provides details of the target and forecast Police Officer strengths. It should also be noted that some officers included within the strength figures are off-pay or on reduced pay for a number of reasons such as maternity leave, special leave and suspension from duty and these contribute to the underspend position.

33. There has been an overall favourable movement of £0.5m in the forecast from the position reported at Period 10.

Table 4 – Police Officer Actual Strength v Target Strength

34. Police Staff Pay - An underspend of £5.3m – 0.9% of budget
The forecast underspend is principally within Human Resources relating to existing vacancies within the Transforming HR Programme, the Vehicle Removal & Examination Service and Catering Services. There are also underspends within Resources, reflecting a reduction in the use of agency staff and preparations for restructuring which will yield permanent savings, and within the Directorate of Information reflecting vacancies and the capitalisation of some staff costs. This is partly offset by an overspend within Specialist Crime Directorate primarily caused by Forensic Services recruiting ahead of their original plans and an overspend within Territorial Policing following delays to the implementation of Integrated Prosecution Teams (IPT) and delays to Finance & Resource modernisation.

35. There has been a favourable movement of £2.3m in the forecast from the position reported at Period 10, with a number of Business Groups revising their forecasts to provide a more realistic assessment of their year end position.

36. PCSO Pay - An overspend of £3m – 2% of budget.
The forecast overspend is within Territorial Policing where there has been lower than expected wastage and where the movement of PCSOs into other roles is being managed to avoid vacancies. There has been a minor favourable movement in the forecast from that reported at Period 10.

37. Traffic Warden Pay - An overspend of £0.9m – 10.1% of budget.
The forecast overspend is within Territorial Policing following delays in anticipated transfers to PCSO roles. This is principally within the Transport OCU and whilst the overspend is being managed within the overall “bottom-line” TOCU budget, the position is under review as part of the Safer Transport initiative. There has been a minor favourable movement from that reported at Period 10.

38. Police Officer Overtime – An overspend of £9.8m – 7.9% of budget.
The forecast overspend relates principally to the policing of the G20, Tamil and Climate Camp demonstrations. Appendix 4 shows that £10.7m of the forecast overtime cost relates to major operations for which no specific budget provision exists. If the costs for these major operations are excluded then the forecast would show an underspend of £0.9m (0.7% of budget). Funding of the additional costs incurred as a result of the G20 demonstrations has been received from the Home Office and the MPA has agreed that reserves may be used to offset the cost of the Tamil demonstrations if the year-end financial position is an overall overspend.

39. There has been a favourable movement of £1.5m from that reported at Period 10. This is principally within Territorial Policing following management action and reviews of anticipated activity prior to year end.

40. Police Staff Overtime – An overspend of £0.8m – 2.3% of budget.
The forecast overspend relates principally to Specialist Crime Directorate for increased activity within Forensic Services department and covering vacancies within the Intelligence Bureau. Additionally there is an overspend within Territorial Policing relating to increased use of Police Staff to provide support for operational activities. This is partly offset by an underspend within Human Resources Directorate relating to reduced overtime within Catering Services and reduced activity within the Vehicle Removal & Examination Service.

41. There has been a minor favourable movement from that reported at Period 10.

42. PCSO and Traffic Warden Overtime – An overspend of £0.4m - 37.3% of budget.
The forecast overspend is within Territorial Policing relating to operational requirements, where activities such as Operation Winter Nights (a Safer Neighbourhoods initiative to reassure the public via a high visibility police presence) have required the support of PCSOs to increase visibility. There has been a minor adverse movement from that reported at Period 10.

43. Employee Related Expenditure – An overspend of £2.7m – 7.5% of budget.
The overspend forecast is principally within Human Resources and relates to the forecast cost of delays to the Transforming HR Programme. There are also overspends forecast within: Specialist Crime principally relating to external training costs; Central Operations relating to seconded officers used for Public Order aid; Directorate of Information for increased advertising costs to address staff recruitment issues and the MPA relating to additional legal expenses, early retirement costs, secondment costs and recruitment drives to fill vacancies. These are partially offset by an underspend within Resources Directorate in respect of reduced tax liability for free rail travel.

44. There has been a minor adverse movement in the forecast from the position reported at Period 10.

45. Premises Costs – An overspend of £1.4m – 0.6% of budget.
The forecast overspend is principally within Resources relating to Facilities Management costs for reactive works across the MPS estate with additional overspends forecast in Specialist Crime relating to the refurbishment of the fingerprint bureau at New Scotland Yard, Directorate of Information relating to storage improvement works and within Central Operations due to additional costs for parking facilities at Bishopsgate Firearms training centre.

46. There has been a favourable movement in the forecast of £1.2m from the position reported at Period 10, principally within Specialist Operations following the allocation of budget from ACPO TAM for office rental costs.

47. Transport Costs - An overspend of £1.3m – 1.8% of budget.
The forecast overspend is principally within Central Operations and relates to additional public order vehicle hire resulting from the G20 and Tamil demonstrations, increasing fuel costs and unfavourable exchange rates relating to helicopter maintenance within the Air Support Unit.

48. There has been a minor favourable movement in the forecast from the position reported at Period 10.

49. Supplies and Services - An overspend of £0.5m - 0.1% of budget.
There has been a favourable movement of £1.4m in the forecast from the position reported at Period 10, principally within Territorial Policing following a review of expected activity prior to year end. The material variances within this category are:

• DNA Testing - An underspend of £3.7m – 49.8% of budget. This reflects changes to working practices resulting in a forecast for fewer tests being requested.
• Forensics - An underspend of £0.7m - 1.9% of budget. This reflects a reduction in forecast activity in this area following the introduction of strict criteria for forensic submissions.
• Dangerous Dogs Act – An overspend of £1.2m - 89% of budget. This relates to the costs of kennelling, veterinary care, and associated expenses for dogs seized by Police Officers under the Dangerous Dogs Act 1991. The number of dogs seized has increased considerably compared to last year due to greater ownership and use in criminal activity, both as a weapon and as a status symbol. A budget increase of £1.5m per annum has been included as part of the 2010-13 Planning process.
• External Consultants - An overspend of £0.6m - 9.5% of budget. This is principally due to employing consultants in Human Resources as a result of delays caused by the THR Programme and Territorial Policing to support the MPS Youth Strategy.
• Payments to Association of Train Operating Companies - An overspend of £0.6m - 3.7% of budget. This results from an increase to the contract price for the provision of free rail travel to Police Officers. This cost is related to and offset by an overall underspend in total Running Expenses within the Resources Directorate in respect of the tax liability on the ATOC agreement.
• Mobile Communications - An overspend of £0.5m - 14.7% of budget. This reflects increased usage and volume of wireless connections throughout the MPS.
• OTSU Evidential Analysis - An overspend of £0.7m - 8.8% of budget. This reflects the increasing demand for analysis of CCTV and other data evidence.
• Revenue Contribution to Capital Outlay – An overspend of £0.7m. This relates to vehicle purchases in support of frontline proactive intelligence teams within the Specialist Crime Directorate.

50. Capital Financing Costs – An underspend of £1.5m – 6.4% of budget.
As previously advised, the forecast underspend is principally due to a lower than budgeted forecast for the Minimum Revenue Provision (MRP). This is due to a lower than budgeted 2008/09 capital outturn and hence a lower than expected capital financing requirement. This is partly offset by additional interest payable on new external loans arranged by the Authority in 2008/09.

51. There has been a favourable movement of £0.3m in the forecast position from that reported at Period 10 as borrowing has been undertaken later in the year than originally planned resulting in lower interest payments.

52. Interest Receipts – An adverse position of £3.3m – 157% of budget.
The principal cause of the adverse position is the inclusion of an anticipated write-off of penalty interest (£2m) relating to Landsbanki investments which had previously been accrued in 2008/09 on the advice of Cipfa. Additionally, the forecast recognises the latest advice regarding the reimbursement of Landsbanki investments, as it is now believed that the first repayment will not be received until 2010/11. There has been a minor favourable movement in the forecast from the position reported at Period 10.

53. Other Income - An under-achievement of £1.5m – 0.4% of budget.
The under-achievement is principally within Specialist Operations and Territorial Policing, although much of it relates to areas where expenditure has also reduced such as for the provision of policing at Heathrow Airport and the Palace of Westminster as well as lower than budgeted income from Immigration receipts. This is mostly offset by an over-achievement of income within Centrally Held relating to accounting adjustments to write off unmatched goods receipts relating to previous financial years and within Specialist Crime with regard to increased POCA receipts.

54. There has been a minor adverse movement from the position reported at Period 10.

55. Specific Grant – An over-achievement of £2.3m.
The over-achievement relates to additional Loan Charges grant resulting from a lower balance of useable capital receipts (due to the need to use significant levels of usable capital receipts to finance the Capital Programme in 2008/09) and a grant payment of £3.6m from Home Office relating to reimbursement of additional costs incurred as a result of the G20 summit. This is offset by lower than budgeted grant within the Olympics Security Directorate which is matched by reduced expenditure.

56. There has been an adverse movement of £2.3m from the position reported at Period 10, relating to budgets being set within Specialist Operations for grants which had been forecast at period 10 but were unbudgeted (additional DSP Grant for pay inflation costs, National CT Media Campaign funding and ACPO TAM rental costs funding). The increased variance in Specific Grant is offset by reductions in other categories of expenditure as matching expenditure budgets have been allocated.

57. Budget movements
As previously advised, the MPA/MPS Business Plan was approved by MPA Full Authority on 26th March 2009. Since that time budget amendments have been made relating to changes in the funding stream for Counter Terrorism (at the time of the budget submission, funding levels had not been finalised with the Home Office). Funding streams relating to PCSOs have also required changes to the subjective allocation of budgets. Allowing for these issues and other in-year budget movements, funding budgets (income, specific grant and transfers from Reserves) have increased by £29.6m since the budget submission and corresponding expenditure budgets have been set accordingly. Appendix 2 shows the subjective budget movements that have been required in the time between the original budget submission and the presentation of this report. The major budget movements undertaken in Period 11 are shown below in Table 5.

Table 5 – Major budget movements actioned in Period 11

Movements in Reserves

58. The reserve movements carried out in Period 11 are shown in Table 6.

Table 6 – Reserve movements carried out in Period 11

Capital Monitoring

59. Despite the downturn in the economy adversely affecting the expected level of capital receipts available in 2009/10 to support the capital programme, an ambitious level of investment was still proposed. This has proved possible thanks to the judicious use of (a) unsupported borrowing; (b) capital reserves; (c) revenue underspend from 2008/09; and (d) Service Improvement Programme funds. This financing situation is closely monitored to ensure all funding sources remain available and the capital programme continues to be affordable and sustainable in accordance with the requirements of the Prudential Code. This is critical when considering the projects that have been rephased from 2008/09 and the capacity issues that arise from this.

60. On 19th November 2009, the MPA Finance and Resources Committee agreed a revised capital programme reflecting a rephasing of project expenditure into 2010/11 and beyond. This report provides forecast variations against the revised annual budget.

61. Appendix 3 sets out the expenditure for the 2009/10 Capital Programme as at Period 11 (February) by programme. Year to date expenditure is £137.9m, representing 64.4% of the revised annual budget of £214m. The forecast for the year of £186.1m is £27.9m below the revised annual budget.

62. Property Programme – An underspend of £7.0m - 13.8% of revised annual budget.
The main reasons for the forecast underspend are slippages in the implementation of the sustainable development projects associated with the Climate Change Action Plan; prolonged negotiations in obtaining licence agreement from the landlord to alter the Polar Park site at Heathrow and the late receipt of security clearance which has resulted in slippage in the implementation of projects associated with the Central London operational facilities at New Scotland Yard. It should be noted that the Climate Change Action Plan has its own dedicated funding source which allows for underspends to be rolled forward into future years. Furthermore, extended negotiations with prospective occupants of several floors at Empress State Building will result in delays to the proposed works. Additionally, changes to technical specification and other acquisition issues have resulted in delays to the purchasing of a covert property. Moreover, there were cost savings generated on the construction of Havering Patrol Base and contractual delays in providing feasibility costings have resulted in a decision to delay the Jubilee House upgrade. These identified delays and issues have all resulted in a further reduction of £1.1m in the forecast position since last Period

63. Information Programme – Excluding C3i – An underspend of £6.9m - 7% of revised annual budget.
The main reason for the forecast underspend results from a decision not to proceed further with the Metafor project. Further underspends result from slippage in procurement of equipment associated with the Events Management Futures project where tendering bids received were significantly higher than expected. Additionally, in order to ensure that the main part of the Pyxis project is completed by the end of March, the supplementary work on email and audit will be rephased to the second quarter of the 2010/11 financial year.

64. Transport Projects – An underspend of £1.7m - 10.1% of revised annual budget.
The main reason for the forecast underspend results from the setting up of an internal car hiring pool associated with the Service Improvement Plan. Budget has been earmarked to purchase additional vehicles for the hire pool but these will not be delivered in this financial year. Transport Services will request formal approval, at the year end, to rephase this project into 2010/11.

65. Other Plant & Equipment Expenditure – A minor underspend against the revised annual budget.

66. Language Programme − An underspend of £3.7m - 99.5% of revised annual budget.
Delays in the tendering process for the procurement of language services are ongoing. This means that contracts will not be awarded and associated work is not scheduled to start until 2010/11. This programme has ring-fenced funding from the Service Improvement Plan fund.

67. Directorate of Information – C3i Programme – An underspend of £1.8m - 44.8% of revised annual budget.
The main reason for the forecast underspend is due to slippages in the supply of equipment for the Crime Reporting Information System and the Telephony Call Routing System (CRS) projects. The CRS project is an advanced contact centre system for the skills based routing of all MPS emergency, non emergency and internal operator calls. The Directorate of Information will request formal approval, at the year end, to rephase these projects into future years.

68. Safer Neighbourhoods Programme – A minor variation against the revised annual budget.
Previously reported delays in the sourcing of suitable accommodation by the Property Services element have been resolved and as a result the forecast has been increased to show a £3.5m overspend. This £3.5m was included within the original Property Services budget but was rephased into next financial year following approval by the MPA in Period 6. Property Services are now on target to fully complete its scheduled work in this financial year. The Directorate of Information element is reporting an underspend of £3.7m. This represents the Safer Neighbourhood contribution towards the purchase of Personal Digital Assistants for front-line officers; however the current model has been superseded by an upgraded model which is currently undergoing substantial testing. Furthermore, the late sourcing of suitable accommodation by Property Services means that the ultimate fit out of these by the Directorate of Information will not all occur within this financial year, and a formal request will be made to rephase the associated unutilised budget into 2010/11.

69. Olympics/Paralympics – An underspend of £0.7m – 56% of revised annual budget. The Olympics/Paralympics Programme is funded by specific grant and each project is subject to Home Office approval following the submission of individual business cases. In Period 6, MPA Members approved a budget reduction of £25.9m to this Programme. The initial Olympics/Paralympics Programme budget assumed a high level of Intelligence staff personnel, which will not materialise this year. The effect of this is a significant reduction in proposed building works (and the associated IT fit-out costs) to house these personnel. Instead, options around enhancing existing estates are currently being reviewed. The current forecast is based on the latest expectations of the number of projects that will be approved for funding this year.

70. Counter Terrorism – An underspend of £1.8m - 15.8% of revised annual budget. The underspend is due to delays to the provision of Terrorist Act (TACT) prisoner cells.

71. ACPO TAM – An underspend of £4.4m - 56.3% of revised annual budget. In Period 6, MPA Members approved a budget increase of £7.8m which represented the Association of Chief Police Officers Terrorism Allied Matters (ACPO TAM) projects not included in the original 2009/10 programme. This increase now forms part of the revised Capital Programme. As advised in Period 9, however, there was a possibility that some of the ACPO TAM projects may not result in an MPS-owned asset. Following a detailed investigation of this issue, it is now apparent that some of the ACPO TAM funded budget is for non-MPS owned projects and the forecast has been reduced to take account of this.

C. Race and equality impact

There are none specific to this report.

D. Financial implications

The financial implications are those set out in this report.

E. Background papers

• Policing London 2009-12 Business Plan.

F. Contact details

Report author(s): Nick Rogers, Director of Group Finance, MPS

For more information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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