Police Property Act Fund

Report: 7
Date: 24 March 2011
By: Director of Resources on behalf of the Commissioner and the Treasurer

Summary

This report on the Police Property Act Fund (PPAF) provides:

• Estimated PPAF balance 1 April 2011;
• The latest position of grants awarded 2010/11;
• Proposals for the allocation of the 2011/12 grant budget;
• PPAF support to Children and Young People strategy projects

A. Recommendations

That Members:

1. Note the current position of grants awarded 2010/11
2. Approve proposals for the allocation of the 2011/12 grant budget
3. Note the level of support to MPS centrally supported youth engagement interventions.

B. Supporting information

Background

1. The Police (Property) Act 1897 and subsequent Police (Property) Regulations 1997 apply to property that is in the possession of police where the owner of the property cannot be identified and where no order of a competent court has been made.

2. Subject to the provisions of the 1997 Regulations the proceeds of all sales are retained separately in the Police Property Act Fund (the PPAF). The income derived from funds invested is added to and becomes part of the PPAF.

3. The PPAF may then be used to meet the expenses incurred in the conveyance, storage, safe custody and sale of the property and to make payments for charitable purpose. The PPAF meets direct cost expenditure, such as auction costs, and a notional annual administration charge of £0.2m to the MPS.

4. Additionally cash that has been seized for the purpose of a criminal investigation and retained in order to establish its lawful owner and where there are reasonable grounds for believing that it has been obtained in consequence of an offence is held in the Detained Monies Account (DMA). Detained money is retained until directions are received from a Court or, if a case does not reach a hearing, from the officer in the case. This does not include cash sums seized and detained under the Proceeds of Crime Act 2002 (and subsequent amendments) and administered separately within Finance Services.

Detained Money Account – six year transfer

5. Legal advice has established that DMA money in police possession for six years, where no claim has been received, can safely be considered as PPAF money. On 1 April 2010 £0.93m detained in financial year 2003/04 was reclassified and transferred from the DMA to the PPAF. It is estimated that a further £0.8m, relating to sums detained in 2004/05, will be available for transfer from the DMA to the PPAF on 1 April 2011.

PPAF balances

6. The 2009/10 financial statements reviewed by Finance and Resources Committee on 23 September 2010 confirmed that a surplus of £1.79m contributed to a general fund balance of £3.78m at 31 March 2010. Taking account of income and expenditure streams in 2010/11 it is estimated that the general balance will be £4.5m at 31 March 2011.

Update on the PPAF Grant Budget 2010/11

7. On 22 April 2010 Finance and Resources Committee approved a 2010/11 grant allocation of £0.61m to boroughs (and Royal Parks). The latest position is that £0.485m of grant applications have been approved, representing 80% of the allocation. Regular reminders are sent to boroughs about their unspent 2010/11 allocations with advice that any unallocated sums will be withdrawn for redistribution in 2011/12. Boroughs advise that further applications will be received before year-end and it is estimated the under spend to be reallocated will be approximately £0.05m.

8. The latest position of the 2010/11 grant allocations and details of awards made are attached at Appendices 1 and 2.

Proposals for the Allocation of the Grant Budget 2011/12

9. The annual transfer of six-year balances from the DMA to the PPAF continues to support PPAF balances but future income from this source is not guaranteed being dependent on the amount of cash seized and subsequent success in identifying a lawful owner. Other income streams, such as that from the sale of property, are similarly uncertain so a prudent approach should be taken when setting the budget for grant allocations. This will allow for regular and consistent future allocations to boroughs and charitable schemes. However, the continuing surplus on the PPAF each year has contributed to a fund balance of about £4.5m so an increase to the grant budget is sustainable for 2011/12.

10. It is proposed that with the reallocation of the estimated 2010/11 underspend of £0.05m an additional £0.75m is made available, giving a 2011/12 grant budget of £0.8m. This is an increase from 2010/11 of £0.19m. It is proposed that current practice is maintained and this budget is again allocated to boroughs using the weighted formulae established in 1998 and updated 2006.

11. Members are reminded that the formula was devised specifically to underpin the specific aims and objectives of the PPAF of assisting victims of crime, those vulnerable to crime and to divert people, especially the young, away from crime, and is based on borough statistics for five variables with equal weighting:

• Population
• Unemployment level 16 to 24 year age range
• Deprivation factors
• Recorded offences
• Recorded offences 10 to 16 year age range

12. The application of this formula to the proposed budget of £0.8m gives the borough allocations set out at Appendix 3.

Children and Young People Strategy

13. A review of the grants awarded by boroughs in 2010/11 shows that an increasing number of awards were made to the same project, to support that initiative in a number of boroughs. Appendix 2 shows 11 awards were made to uniformed youth organisations (part of the YOU London partnership), 9 awards to London Youth Rowing (Met Row), 8 awards to the British Athletic Charitable Trust (Met Track) and 3 awards to Kickz projects.

14. In view of the support provided by the PPAF to these projects enquiries were made of the individual scheme leaders and to the MPS Children and Young People (CYP) strategy programme manager. The evolving CYP strategy 2011 – 2014 includes a portfolio of MPS centrally supported youth engagement intervention schemes, including the PPAF supported projects mentioned above. Due to the role the PPAF plays in supporting these projects perhaps consideration should be given to its future funding role with regards to the CYP strategy and whether, for example, ring fenced funding should be provided to support specific initiatives within the strategy.

15. Currently the CYP strategy is not finalised and work continues to scope the range and number of locally supported youth projects. It is not proposed to change current PPAF funding arrangements and the projects mentioned above can continue to access PPAF funds in 2011/12 by application for the borough allocations.

16. During 2011/12 when the CYP strategy is in place and the extent of continuing PPAF support to CYP youth interventions becomes clear, options for the future PPAF funding of these projects will be considered and put to Members for review.

Summary

8. The MPS proposes for 2011/12 that:

• The 2010/11 under spend of £0.05m is withdrawn and redistributed.
• The under spend and an additional £0.75m provides a total grant budget of £0.8m
• The allocations to Boroughs are again based on the PPAF formula percentages as shown in Appendix 3.
• Current practice continues and boroughs are advised that funds are available for 2011/12 and that any underspend will be withdrawn at year end for reallocation in future years.
• The extent of support to CYP projects is reviewed and proposals made for future PPAF funding

C. Other organisational and community implications

Equality and Diversity Impact

1. Grants are awarded to organisations whose work encourages the development of positive relationships between members of the local communities and the police, especially those sections of the community which are currently under-represented in the MPS, to improve informed community engagement in the policing of London.

2. Organisations awarded grants also promote equality and diversity both in their employment practices and service delivery and should not seek to promote or oppose any religion or religious belief.

Consideration of MET Forward

3. Grants are awarded to organisations whose work supports people who are or have been victims of crime or vulnerable to crime. Grants are also awarded to improve the quality of life for residents by initiatives which prevent crime or reduce the fear of crime and which divert people, especially young people, away from crime.

Financial Implications

4. There are no financial implications in relation to the Metropolitan Police Authority Fund. The financial implications for the Police Property Act Fund are addressed above.

Legal Implications

5. The role of the MPA in the administration of the Police Property Act Fund is to:

1. nominate an auditor;
2. set the amount of compensation to be paid to persons delivering property to the police;
3. direct the investment of the money held in the PPAF;
4. authorise the MPS to retain property (other than money) for police purposes; and
5. determine the amounts to be paid for charitable purposes
6. The MPA’s responsibilities are delegated to MPS Director of Finance Services subject to certain consultation and reporting requirements.
7. The Treasurer of the MPA receives a copy of the PPAF annual accounts and must be consulted regarding policy and contentious issues.
8. This report is submitted as part of this governance process and no legal implications arise.

Risk Implications

6. The annual allocation from the Police Property Act Fund that is identified for distribution for charitable purposes is determined having considered the current and estimated financial position of the Fund thereby ensuring that the Fund is able to meet all its obligations. Budget monitoring and administrative processes ensure compliance with the published guidelines and the annual audit of the Fund provides the additional assurance that the operation of the Fund is compliant with legislative requirements.

D. Background papers

• Finance Committee 20 April 2006
• Finance and Resources Committee 23 September 2010

E. Contact details

Report authors: Paul Daly, Director of Exchequer Services, MPS

For more information contact:

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

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