Revenue and capital budget monitoring 2005/06

Report: 06
Date: 23 June 2005
By: Commissioner

Summary

This report provides an update on the performance against the revenue budget as at the end of May (Period 2). It has been prepared on an exceptions basis and there are no significant matters to report other than on-going pressure on the Police Officer Overtime budget.

There are no variations to capital budgets reported at this stage.

A. Recommendation

That members note the revenue and capital budget position.

B. Supporting information

Background

1. It has not been the normal practice to report on the budget monitoring position as at the end of May (period 2) since there is insufficient actual information on which to base a forecast and unless there has been a significant and unexpected event in the first two months of the year there is no reason to assume that any deviation from budget will occur.

2. In previous years, the May forecasting exercise has been used to ensure that processes and systems are in place to allow a comprehensive forecasting exercise to be carried out in Period 3 based on actual information up to the end of June. The results of the May exercise are therefore treated with caution. In addition, there has recently been a pressure on staff resources with a significant amount of time being dedicated to supporting the Service Review process in addition to completing the forecasting exercise.

3. However, in order to get an early indication of any significant budget issues, we have conducted an exception reporting exercise and asked the business to report by exception on any potential major budget variances.

4. The information in Appendix 1 provides an analysis of the revenue budget for 2005/06 by business group and subjective heading and reflects the newly created Central Operations Group. The Central Operations Group consists of Central Operations Headquarters, the Pan-London units which have transferred across from Territorial Policing and also the National Identification Service, SO19 and the Firearms Policy Unit which have transferred from Specialist Operations.

Potential significant budget pressures in 2005/06

5. Feedback from the business suggests that 2005/06 will see a significant amount of pressure on the budget. However, the only specific budget area that has been identified as a concern is Police Officer Overtime. This was running at an annual rate of £16 million overspend in 2004/05. Action will be taken to ensure that any developing overspend is offset by compensating underspends within the existing budget. The loss of Street Crime Grant funding and a reduction in performance in relation to Street Robbery and Trident Gun Crime is causing pressure on the budget. Also, there is the ongoing funding shortfall issue in Specialist Operations with regard to Dedicated Security Posts as has been previously reported. It is hoped that the Authority will agree to the release of reserves in 2005/06 to fund emerging budget pressures relating to a number of high priority major items i.e. the implementation of Bichard Enquiry recommendations, Service Review, Custody Clusters and Tasking.

6. There are no significant variations from the capital programme at this stage. Business groups will identify requirements for carry forwards of funding from 2004/05 to 2005/06 to reflect planned rephasing of certain projects. Details will be provided in the report to the Finance Committee in July.

C. Race and equality impact

There are none specific to this report.

D. Financial implications

The financial implications are those set out in this report.

E. Background papers

None.

F. Contact details

Report author: Sharon Burd, Director of Finance Services

For more information contact:

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

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