MPA budget monitoring to November 2000

Report: 7
Date: 19 December 2000
By: Treasurer

Summary

This report sets out the current position against budget, the forecast outturn for the year and highlights key issues.

A. Supporting information

1. The following appendices set out the financial position in respect of the MPA Budget for 2000/01:

• A: Budget and forecast full year outturn.
• B1: Budget and actual expenditure (subjective basis) year to date.
• B2: Budget and actual expenditure (functional basis) year to date.

Revenue

2. The forecast of the outturn position continues to be refined as income streams become more definite and expenditure projections are subject to more scrutiny. The current forecast is a marginal overspend of £1.3m, an improvement of £300k from the position reported to the November committee.

3. There is no reason to alter projections of income with respect to specific Home Office funding with the exception of the inclusion of £900k of “Warrant Execution” funding for a service which had been expected to transfer mid-way through the current year. The transfer of the service to the GLMCA will take place from April 2001.

4. Key points to bring to the Committee’s attention in respect of the revenue forecast (Appendix A) are that:

• The forecast for police pay continues to exclude any adjustment for London allowance anomalies which affects just over 3000 officers. PNB is still considering a proposal to increase London allowance to these officers by £1,000 which, if agreed, would cost an additional £2.5m in 2000/01.
• The forecast underspend on civil staff remuneration is more realistic as external consultants costs have been re-classified as Other Service Costs. The rate of underspend is projected to slow towards the end of the year as the level of leavers appears to be growing more slowly.
• The forecast for operational supplies and services has increased because of continuing overspending on forensic submissions, DNA testing, interpreters and translators fees and vehicle removals, the latter following the letting of a new contract. The MPS has reached and exceeded its threshold with regard to the DNA expansion programme and is now assured to receive the associated grant income of £3.5m.
• Whilst the total projected position for the Department of Information is consistent with that reported last month, there has been a refining of the individual projections for Communications and Information Technology. This has resulted in a significant increase in the overspend projected for Communications arising from the level of telephone moves and changes and the increase in mobile telephony. Information Technology’s overspend has reduced following a review of commitments to the outsource contractors

5. A firm response to the additional funding request in respect of the costs associated with the May Day demonstrations has still to be received.

6. Whilst the projected overspend for the outturn represents a small percentage compared with the Service’s net current expenditure, the Resource Allocation Committee of the MPS has reaffirmed the contingency plan to reduce expenditure in the event of a continuing overspend forecast. The plan involves the slowing down of non-pay expenditure in the event of December or January based forecasts showing the level of outturn overspend either increasing or continuing at the same level.

B. Recommendation

That the information presented in the attached appendices and the explanations for some of the key variances presented be noted.

C. Financial implications

The forecast outturn position has improved since being reported to the November committee and net current expenditure is now forecast to be £1.3m or 0.1 per cent over budget.

D. Review arrangements

Further monitoring reports will be submitted to future meetings of the Committee.

E. Background papers

The following is a statutory list of background papers (under the Local Government Act 1972 S.100 D) which disclose facts or matters on which the report is based and which have been relied on to a material extent in preparing this report. They are available on request to either the contact officer listed above or to the Clerk to the Police Authority at the address indicated on the agenda.

None.

F. Contact details

This report has been jointly agreed by the Treasurer of the MPA and the MPS Director of Resources. The author of this report is Bob Alexander, Head of Finance.

For information contact:

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

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