Revenue budget update 2002/03 (inc budget implementation update)

Report: 10
Date: 11 July 2002
By: the Treasurer and Commissioner

Summary

This report updates members on the 2002/03 revenue budget and progress that is being made.

A. Recommendations

Members are asked to note the contents of this report and approve the virement of £1m from police overtime to support the strengthening of the Criminal Justice Units.

B. Supporting information

Budget book

1. The approved budget book was delayed in order to resolve outstanding allocations the most significant being the allocation of the Hay review funding that has now been validated and incorporated. Copies should be available to members by the time of the Committee meeting.

Transport OCU

2. The Special Services Agreement with TfL - approved by the meeting of the full MPA on 25th April - came into effect on 10th June. The new Transport Operational Command Unit is now working through a development phase whereby recruitment exercises are being conducted with the aim of recruiting staff up to the level agreed with TfL. So far 191 staff have been recruited of which 135 have joined the TOCU. The delivery of Special Services has commenced on 2 bus routes and it is planned that services will be extended to a total of 13 routes by December 2002

Counter terrorism

3. Work is progressing to implement the changes arising from the additional grant received from the Home Office. Further discussions have taken place between the MPS and the Home Office to gain clarity over the expectations surrounding the additional funds.

4. Following this further work has been undertaken and the MPS SMT revised the allocation of this additional funding as follows:

*Specifically covers HM The Queen Golden Jubilee celebrations, and other public order events.

5. A detailed plan has been constructed to manage this growth as part of the overall growth of the Service.

Street crime

6. Further information has now been made available on the Home Office one-off grant for Street Crime. The allocation provides for:

• £6.5m for Police Overtime, inclusive of employers national insurance contributions.
• £0.9m for civil staff support through overtime will a small amount £280k to cover basic pay.
• £5.6m for Capital Expenditure on equipment, this will comprise mainly vehicles but also some additional IT and other equipment. Representations have been made to the Home Office to convert some of this Capital Grant to revenue to provide for equipment running expenses.
• £13m Total one-off grant

Allocation of additional officers

7. The allocation of the 1,000 officers funded by the Mayor across the operational units has now been completed and agreed by MPS SMT. This process follows a detailed analysis of need. The final allocation can be summarised as follows:

A breakdown of the budget implication is included at Appendix 1.

Delivery of budget savings

8. The MPA's Budget Group recently received an update report from the Budget Change Team on the achievement of the savings target for 2002/03. The report indicated that of the savings target of £60m, £55.5m was forecast to be delivered, £4.5m being classified as significantly at risk.

9. This is a worse position than that reported to the May Committee when the full £60m was considered achievable. This is a cause for concern within MPS management and urgent action is being taken to remedy the position. It appears that there may be some confusion within some of the themes regarding the impact of growth monies and/or other developments that are blurring the true savings position.

10. The MPS has undertaken to bring a further report to the next MPA Budget Group on 24 July where any legitimate shortfall arising from existing themes will be made up. While this pressure has been flagged by the Savings Team, it has not materialised from the exception reports from Business Groups for Month 2 monitoring (see below).

Monitoring

11. A monitoring by exception exercise was undertaken for period 2. The required managers to report any items which are expected to significantly vary from Budget (over £500k). This exercise did not identify any unknown issues and included:

• Impact of the HM The Queen's Golden Jubilee, HM The Queen Mother's Funeral – funding available from the Counter Terrorism Funding.
• Cost pressures associated with the retention of Tintagel House. This is being further evaluated by the Director of Property Services.
• Hendon Accommodation recently reported to Coordination and Urgency Committee, which agreed the funding this pressure.

12. At this early stage this review, supported by an analytical review of the year to date spend, would indicate that the only material pressures are Tintagel House and the achievement of the Budget Savings Target. The Committee should be aware that urgent work is ongoing to ensure that on allocation to the Human Resources function the additional funding ear-marked in the tranches of growth money that Business Group is sufficiently resourced to deliver the demanding recruitment and training targets it has been set.

13. The position is predicated on the assumption that the £10m withheld by the MPA is released following the Treasurer being able to recommend such action to the Committee later in the year.

Virement request

14. With the current acute focus on street crime and the performance of the Criminal Justice System, the MPS is aware of the need to strengthen criminal justice units in boroughs. Accordingly it is proposed that £1m of the recurring growth to police overtime be permanently vired to support this. This will put pressure on police overtime budgets but is alleviated to some extent by the MPS receiving significant non-recurring Street Crime funds from the Home Office in 2002/03.

C. Financial implications

As set out in this report.

D. Background papers

None.

E. Contact details

Report author: Bob Alexander, Director of Finance, MPS.

For information contact:

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

Appendix 1

Provisional budget allocation to reflect planned development profile

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