Police Property Act Fund – closing of accounts for 2010./11

Report: 7
Date: 22 September 2011
By: Director of Resources on behalf of the Commissioner and the Treasurer

Summary

This report on the Police Property Act Fund (PPAF) gives a review of the financial statements 2010/11, provides the latest position of grants awarded 2011/12 and seeks approval for a £25,000 grant award to Ealing Borough.

A. Recommendations

That members

1. Note the report on the 2010/11 annual accounts for the Police Property Act Fund
2. Note the current position of grants awarded 2011/12
3. Approve a £25,000 grant award received from Ealing Borough

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 2010/11 notional administration charge of £200,000 from 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.

Annual Accounts 2010/11

5. The Finance and Resources Committee on 22 April 2010 requested that the annual accounts be presented to the Committee sooner after the year end than was previously the case. The appointed auditor has prepared the financial statements in sufficient time to allow reporting to this Committee.

6. There are two sets of annual accounts, recognising the distinction between the DMA and sums that are appropriate to the PPAF. In accordance with financial safeguards established by Finance Committee in February 2004 copies of the PPAF and the DMA 2010/11 annual accounts have been submitted to the MPA Treasurer. A summary of the PPAF income and expenditure account 2010/11 and balance sheet as at 31 March 2011 are set out at Appendix 1.

7. The estimated final position and details of all of the awards made were provided to Finance Committee on 24 March 2011 and are not restated here. There were adjustments to the final figure for grants awarded in year of £593k, against an allocation of £610k, a 97% take up of grants by boroughs.

8. The 2010/11 surplus is largely a result of six year old deposits retained in the DMA being transferred to the PPAF. Legal advice determined that such deposits, retained in police possession in excess of six year where no claim has been received, could be considered as PPAF money. At 1 April 2010 sums detained in the 12 months to 31 March 2004 were reclassified resulting in a transfer of £930k from the DMA to the PPAF. (Additionally, at 1 April 2011 sums detained in the twelve months to 31 March 2005 were reclassified resulting in the transfer of £805k from the DMA to the PPAF).

9. The financial outturn for 2011/12, along with predicted income and expenditure going forward, will determine the recommendations made to Finance Committee in April 2012 for the 2012/13 allocation to boroughs.

Update on the PPAF Grant Budget 2010/11

10. On 24 March 2011 Finance and Resources Committee agreed a 2011/12 grant allocation of £800k to boroughs. To date (end of August 2011) £214k of grants have been approved, representing nearly 27% of the allocation. The 2011/12 allocation was about 31% larger than that of the previous year and Finance Services are monitoring closely the value of requests received from boroughs. With regular reminders sent to boroughs about their remaining 2011/12 allocations indications are that boroughs will be able to identify suitable causes to receive PPAF funding.

Request for £25,000 grant award from Ealing

11. The PPAF guidelines state that for grants greater than £20k Finance Services will seek approval from the MPA. Fund balances in past years have meant that in reality awards of this size were not possible, but the growth of the fund in recent years and increased grant allocations to boroughs has given boroughs greater flexibility on size of grants awarded. Ealing Borough have applied for funding of £25k from the PPAF to support Action Acton.

12. Action Acton is a regeneration charity and social enterprise which supports hard to reach disadvantaged local residents into employment, training and learning self employment. Action Acton has been working closely with the Integrated Offender Management (IOM) partnership with specialist employment advisors providing Employment, Training and Education (ETE) support to offenders. The grant will fund an employment advisor (for 3.5 days weekly) who will provide intensive one to one support for IOM offenders referred by Police, Probation or other criminal justice agencies.

13. Ealing’s allocated funding for 2011/12 is £34k and the borough is seeking approval that this larger grant can be provided to Action Acton from this allocation.

Project Voyage Funding

14. On 21 July 2011 this committee noted the funding arrangements for Project Voyage. Total grant aid of £353k, which will be met from existing MPS budgets for 2011/12 included a cash contribution of £60k. The cash funding would be supported by 12 Voyage boroughs (to be identified), each contributing £5k of their PPAF allocation to the project.

Safer London Foundation

15. On the 23 June 2011 this committee approved one off funding of £0.5m to the Safer London Foundation from the Police Property Act Fund. This grant will be processed during September 2011.

Governance

16. 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.

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. This report is submitted as part of the 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 and Resources Committee 22 April 2010
• Finance and Resources Committee 21 July 2011

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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