Report from the Sub-committees of the Finance and Resources Committee

Report: 4
Date: 24 March 2011
By: Chief Executive

Summary

This report contains a summary of the business considered by the Sub-committees of the Finance and Resources Committee.

A. Recommendations

That members note the report.

B. Supporting information

1. This report covers the following meetings:

• Estate Panel – 20 January 2011
• Resources and Productivity Sub-committee –14 March 2011

Estate Panel

2. Amongst the matters discussed at the meeting on 20 January were the outcomes of the visit to properties in Greenwich, Waltham Forest and Barking and Dagenham which had been made on 11 January.

3. The next meeting of the Panel is on 24 March immediately following the Finance and Resources Committee.

Resources and Productivity Sub-committee – 14 March 2011

Comments on reports on the agenda for today’s Finance and Resources Committee

Treasury Management strategy and policy statements and investment strategy 2011/12

4. The report sets out the Treasury Management Strategy and Policy Statements and Investment Strategy recommended for 2011/12. The proposed treasury management strategy will see an increase in the number of countparties from 21 to 25 and the addition of Treasury Bills to specified investments that can be used by the MPA A representative from Arlingclose the Authority’s Treasury Management advisers, attended the meeting and answered questions from members –in particular, about the rationale behind the proposed changes to the counter party list. This explanation has been provided in the revised version of the report which is before the Finance and Resources Committee. Members also drew attention to the possible use of external loans in the future (paragraphs 22 to 24 of the report refers). The report will also be referred on to the next full Authority meeting. The Sub-committee supported the recommendations.

Routine Contracts Programme

5. This report sets out the latest version of the Routine Contracts Programme, which provides members with detail on the contracts above £1m that the MPS wishes to let over the next twelve months on a rolling programme, the details of those contracts let since the last report. The rolling programme covers routine renewals/re-tenders and all known new or emergent requirements. The Sub-committee supported the recommendations.

Other reports considered not on the agenda for today’s FRC meeting

Update on early payment initiatives to SMEs

6. A report was considered which detailed the progress made s on the status of the previously approved actions in support of the Mayor’ s imitative for early payments to Small and Medium Enterprises.

7. The Sub-committee noted that there had been a slippage in performance in January and that the figures for January showed a performance of 66% of payments being made within 10 days of receipt of a valid invoice compared to 81% in the previous quarter. The drop in performance followed the installation of the new payments system in December 2010. A number of technical issues had affected processing speeds and could not be resolved in the short term. The report set out details of how these and other issues were due to be resolved and also outlined the initiatives which Exchequer Services had introduced to ensure that invoices continue to be progressed as quickly as possible. Members indicated that when the next quarterly report is submitted there should be consideration of setting a new target for the payment of these invoices.

Overtime costs – quarterly monitoring report

8. The Sub-committee received a report which provided an analysis of the overtime paid to police officers, police staff and PCSOs during the quarter.

9. Members noted that good progress had been made in controlling the expenditure on overtime in recent financial years and, that using cost figures re-based to 2010/11 levels to recognise the effects of pay inflation, there had been a 22.5% reduction in overtime expenditure in 2009/10 compared to 2005/06 despite 6.9% growth in officer numbers over the same period. The forecast for 2010/11 states that, even after allowing for the impact of the recent and forecast public order demonstrations, this downward trend is expected to continue with a 34.9% reduction in annual expenditure over 2005/06.
The table below demonstrates that the average cost of overtime per eligible Police Officer (Sergeants and Constables) fell by 27.5% between 2005/06 and 2009/10 and is forecast to fall by 38.5% compared to 2005/06.

Average cost of overtime per eligible Police Officer

**Forecast as at end of quarter 3

10. At the request of members the report contained information relating to the extension of officer shifts at short notice and time taken off in lieu. Included below is a summary of the information which may be of interest.

11. Extension of officer shifts at short notice. Planned overtime occurs when an officer is authorised to remain on duty and the officer is informed before, or at the beginning of, their rostered shift. Casual overtime occurs when an officer is authorised to continue working past their normal end-time and they are informed after they have begun their rostered shift. If casual overtime is worked, the duty state is noted to identify it as such. The stage of the officer’s shift at which casual overtime is authorised is not recorded.

12. There are a number of events that might occur during a shift where a need might arise for casual overtime. Examples include:

• Officers needing to remain on duty to process prisoners.
• Critical incidents requiring immediate responses to serious events or officers needing to work overtime to control a situation.

The table below shows the proportion of casual overtime hours worked by Business Groups as a proportion of planned overtime during Quarter 3 of 2010/11 and demonstrates that the vast majority of overtime within Business Groups is planned.

Casual overtime worked by Business Group during Quarter 3

13. Time taken off in lieu (TOIL) When officers work overtime they can choose to be paid, to take time off in lieu (TOIL), or to be paid for part of the time worked and take the remainder off in lieu. Officers can make the choice at any time during the pay period in which the overtime was worked. If officers choose to take TOIL, then the time is allocated on the Duty Roster in accordance with the operational needs of the unit. If an officer does not take the time off within three months, the time is automatically passed for payment instead. TOIL is an historical element and is not identified separately when assessing budget requirements.

Capital programme quarterly monitoring report

14. This report provided members with information on the capital programme for 2010/11 as at the end of the third quarter of the financial year and contained more detailed information at programme and sub-programme level and thus is more comprehensive than the information in the monthly budget monitoring reports considered by the Finance and Resources Committee.

15. Year to date expenditure is £124.1m, representing 44.9% of the revised annual approved budget of £276.3m. Period 9 forecasts predict spend for the year as £222m. This is £54.3m below the target expenditure figure of £276.3m. This eliminates the revised over-programming sum set in July 2010 of £33.2m and indeed forecast expenditure is now below the available funding sum. Discussions with business groups continue to ensure that movement in budgets are reflected in the 2011/12 to 2017/18 capital programme which is presently under construction. The level of capital receipts to be applied to funding capital expenditure in 2010/11 remains at £20m. However, the Finance & Resources Committee has approved the disposal of additional properties which means that the actual level of capital receipts in 2010/11 will now reach £22.3m. The additional £2.3m will be utilised as part of the funding of the 2011/12 to 2017/18 capital programme.

16. The report before the Sub-committee included an appendix which provided a summary of individual projects or schemes of work within each provisioning strand of the Capital Programme. Members noted that the format had been changed to show the detailed information which had been previously requested by the MPA and indicated that they found the new format very helpful.: The detail showed:

• reasons for reported variations;
• a statement regarding how underlying issues are expected to be resolved;
• the financial and non-financial impact (including associated risks); and
• information on projects being held in reserve to bring forward should any slippages occur.

Provision of media buying services

17. The Sub-committee agreed to enter into a four year framework contract for the provision of media buying services for Human Resources People Services and the Directorate of Public Affairs commencing on 1 June 2011. There are anticipated savings compared with the existing contract. The supplier will provide planning, research, development and media buying to the Directorate of Public Affairs in association with policing and recruitment campaigns.

Furniture and ancillary services contract

18. In February 2010 members agreed to enter into a new contract for the provision of furniture and ancillary services. At that time members asked to be notified 6 months after the introduction of the new contract of the progress in achieving the savings and service improvements listed in paragraph 7 of the report considered in 2010.

19. The contract went live on 1 July 2010 and the Sub-committee has now received the six month update. Members observed that from the information supplied concerning the Key Performance Indicators and value for money targets which had been set they were satisfied that there had been good progress in achieving the anticipated savings and improvements.

Other reports considered

20. The Sub-committee received its regular report on the summary of the request for contract action within the previous quarter with a particular focus on the requests that fall under the remit of Single Tender Actions. It was noted that on a value basis the majority of requests for Single Tender Actions were refused.

C. Other organisational and community implications

Equalities Impact

1. There are no race and diversity impact issues directly arising from this report. Any implications are addressed in the reports considered at the Sub-committee

Met Forward

2. The remit of the Resources and Productivity Sub-committee is largely in support of the Met Support strand, but there are no direct implications for the delivery of Met Forward arising from this report

Financial implications

3.There are no financial implications directly arising from this report.

Legal implications

4. Any implications are addressed in the reports considered at the Sub-committee

Environmental implications

5. Any implications are addressed in the reports considered at the Sub-committee

Risk Implications

6. Any implications are addressed in the reports considered at the Sub-committee.

D. Background papers

None

E. Contact details

Report authors: John Crompton, MPA

For more information contact:

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

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