Minutes

Minutes of the meeting of the Finance Committee held on 15 December 2005 at 10 Dean Farrar Street, London, SW1H 0NY.

Present

Members

• Graham Tope (Chair)
• Richard Sumray (Deputy Chair) (from agenda item 8)
• Reshard Auladin
• Richard Barnes
• Elizabeth Howlett
• Bob Neill
• Rachel Whittaker

MPA officers

• Catherine Crawford (Chief Executive and Clerk)
• Ken Hunt (Treasurer)
• John Crompton (Committee Services)

MPS officers

• Sharon Burd (Director of Finance)
• Terry Price (Director of Strategic Finance)
• Alan Croney (Director of Property Services)
• Simon Hart (Director of Business Support) and Phil Scutchings (Directorate of Information) attended for consideration of agenda items 11 and 14
• Helen Dean, Performance Directorate, attended for consideration of agenda item 7

66. Apologies for absence

(Agenda item 1)

An apology for absence was received from Murad Qureshi.

67. Declarations of interests

(Agenda item 2)

There were none.

68. Minutes of the meeting held on 17 November 2005

(Agenda item 3)

Minute 64 Provision of core ICT services

At the 17 November meeting, the Chief Executive was given delegated authority to consider a recommendation concerning the financing of the transition costs for the new ICT contract. The Treasurer reported that following further consideration it had been decided not to proceed with the original recommendation. Instead, the MPA in conjunction with the MPS had developed a solution that will use internal funds to finance the transition costs (rather than using a third party), which allows the costs to be released in a measured manner to the revenue account at the same rate as the accruing benefits. The proposal would save the MPA an additional £2M over the 7-year contract. The Treasurer concluded by saying that the District Auditor had been consulted and on the basis of the information he had seen was not minded to object.

Resolved - That the minutes of the meeting held on 17 November 2005 be agreed and signed as a correct record and the update in connection with minute 64 be noted.

Arising:

Minute 56 – Estates update

Rachel Whittaker asked about the note on the estates strategy which had been tabled at the meeting. The Director of Property Services advised that following completion of the discussions with the relevant stake holders such as the Police Federation it was still planned to submit the report to the February meeting of the Finance Committee. It was agreed that the member be supplied with any further relevant information. Rachel Whittaker also pointed out that members no longer received the disposal schedule and were therefore not being kept up to date with the detailed stewardship of the estate. The Director of Property Services undertook to provide details members required.

69. Chair and Members’ update (oral report)

(Agenda item 4)

There were none.

70. Revenue and capital budget monitoring 2005/06- period 7

(Agenda item 5)

This report provided an update on the revenue and capital budget monitoring position for 2005/06 at period 7 (to the end of October). The revenue budget is forecast to overspend by £14.3m (0.5% of budget), which includes £55m of estimated costs relating to Operation Theseus (terrorist attacks in July). The underlying forecast underspend excluding Operations Theseus and Bracknell (response to the tsunami) is £9.8m, which is further increased by favourable variances on police officer pensions of £28.8m and Operation Bracknell of £2.2m.

The expenditure to date for the capital programme as at period 7 (October) is £122.3m, which is 37.3% of the revised budget of £327.4m. Some adjustments to the capital programme were submitted for approval.

The Treasurer reported that a further £20M of special grant had been received from the Home Office in respect of Operation Theseus. It was not anticipated that there would be any further payments of special grant in respect of this Operation and the balance of the expenditure would be found from the budget underspend. In reply to questions, the Director of Business Support advised that in future monitoring reports the expenditure in respect of Operation Theseus would be shown as part of core MPS expenditure.

Referring to the movements in reserves listed at paragraph 38 members commented that the names of some of the reserves listed did not appear to tie up with the headings that had been used in previous reports. The Director of Business Services confirmed that the reserves listed were ones that had previously been agreed by the Committee and the use of them was in line with agreed policy. He undertook to provide a better harmonisation of the titles used in future reports.

In reply to points raised about the overspend in transport services the Director of Strategic Finance advised that it was intended that there would be better management in the future.

Resolved – That

1. the year to date and forecast position for revenue budgets and the capital programme be noted;
2. the release of reserves be approved; and
3. approval be given to the budget increases to the capital programme.

71. Annual review of the schedule of fees and charges

(Agenda item 6)

This report sets out information on Metropolitan Police Service fees and charges. It also provided details of recent national discussions between the Association of Chief Police Officers and the Immigration Services in respect of charges for the detention of prisoners in police cell accommodation that has implications for the MPS and detailed charges for the special services of police.

Rachel Whittaker referred to the charges shown in appendix 2 which did not appear to be in line with an earlier drive to harmonise the charges with the ACPO recommended ones with the assumption that the charges would invariably be higher in London. The Director of Business Support undertook to consider this point further.

The Chair suggested that the information requested be sent to members but this did not preclude agreeing the revised charges.

Resolved - That the schedule of fees and charges and the special services of police be agreed.

72. MPS development of Activity Based Costing

(Agenda item 7)

Since 2003/4, the Home Office has required that all police forces provide Activity Based Costing (ABC) information to agreed definitions and standards as part of the annual data requirement. This report updated the Committee on the MPS’s implementation for 2004/5, provided an overview of the results submitted and further plans for ABC development this year.

The Committee noted that meeting of the Strategic ABC Board with MPA members was due to be held on 4 January 2006. The Treasurer said the meeting would explore how the detailed data could be brought into the public domain and it was anticipated that the further report to be submitted to the next meeting of the Committee would include the detailed data for 2004/05.

Resolved – That the report be noted and noted that there will be a further report following the meeting with the strategic ABC Board and the Chairs of the Finance and Planning, Performance & Review Committees which is due to take place on 4 January 2006.

73. Budget submission update (oral report)

(Agenda item 8)

The Treasurer provided an update on the budget submission in the light of the grant settlement and the publishing of the Mayor’s draft consolidated budget earlier in the day. A paper was tabled in support of this oral report.

The Committee noted that the counter-terrorism grant had not been announced and it was not clear whether the information would be received in sufficient time to be fully considered and assimilated into the budget to be considered at the special meeting of the Authority which was due to be held on 6 January 2006.

The Chair said that given the uncertainties it would be prudent to assume that there may well be a need to identify further savings for inclusion in the final budget submission.

Resolved -That the report be noted.

74. Delegated authority for utility procurement

(Agenda item 9)

The Utility Procurement Strategy (electricity and gas) was approved by the Finance Committee in April 2004. An essential element of this strategy is the requirement to be able to procure blocks of utility (electricity and gas) on the energy spot market, within hours, following advice from the supplier and the independent consultant. The report was necessary because whilst the individual purchasing decisions associated with these blocks of utilities would fall within existing delegated powers, the aggregated values over the life of the utility contracts would exceed the current delegation arrangements.

Resolved - That

1. approval be given to the delegation of committal authority for blocks of utilities, within the utilities contracts, to appropriate levels as stipulated in the MPA contract regulations and, if then in excess of £1m, to the Director of Property Services subject only to the purchasing decisions being taken on the advice and recommendation of the supplier, retained consultant and the MPA Energy Section; and
2. the Director of Property Services report at six monthly intervals to the Chief Executive of the MPA on all committals made within the period and report for each utility whether the committals are within the current budget profiles and how the purchasing arrangement is performing against market condition.

75. Award of Facilities Management Information contract

(Agenda item 10)

This report described the formal tendering exercise undertaken to select a contractor to deliver the facilities management information contract and sought approval to appoint the contractor to undertake this service.

The Director of Property Services reported that Murad Qureshi, the lead member for estate services, had indicated that he was content with the proposal outlined in the report.

Resolved - That the Facilities Management Information contract be awarded to Atkins Asset Management for a period of seven years from January 2006 with possible extension on a yearly basis up to a maximum of ten years in total dependent upon performance.

76. Microsoft Enterprise Agreement

(Agenda item 11)

This report sought approval to sign a new Enterprise Agreement with Microsoft, an existing key strategic supplier of software to the MPS.

Resolved – That approval be given for the signing of a Microsoft Enterprise Home Office agreement for a period of three years, replacing the current Office of Government Commerce agreement and on the terms contained in the linked exempt report.

77. Exclusion of press and public

(Agenda item 12)

Resolved - That under section 100A(4) of the Local Government Act 1972 the press and public be excluded from the meeting for the following items of business on the grounds that they involved disclosure of exempt information as detailed in paragraphs 8 and 9 of Schedule 12A to the above Act.

Summary of decisions made on exempt items

Minute 78 agenda item 13 award of Facilities Management Information Contract
The information was noted.

Minute 79 agenda item 14 exempt Appendix to Microsoft Enterprise agreement
The information was noted.

Minute 80 agenda item 15 Disposal of Ellerton Road
Report withdrawn

Minute 81 agenda item 16 - exempt minutes of the meeting held on 17 November 2005
Agreed and signed as a correct record.

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