Minutes - draft

Please note these minutes are currently draft and are subject to committee approval.

Minutes of the special joint meeting of the Finance and Planning Performance & Review Committees held on 21 September 2006 at 10 Dean Farrar Street, London, SW1H 0NY.

Present

Members

• Reshard Auladin
• Karim Murji
• Bob Neill (items 5-7)
• Anita Prem
• Richard Sumray
• Graham Tope
• Rachel Whittaker (items 5-7)

MPA officers

• Ken Hunt (Treasurer)
• Jane Owen (Head of Planning and Performance)
• David Riddle (Deputy Chief Executive and Deputy Clerk)
• Ruth Hastings Iqball (Committee Officer)

MPS officers

• Ailsa Beaton (Director of Information)
• Sharon Burd (Director, Finance Services)
• Alan Croney (Director, Property Services)
• Emma Devinish (Manager, Environment and Sustainability)
• Angela Emery (Met Modernisation Programme)
• Steve House (Assistant Commissioner, Specialist Crime)
• Karim Mahamdallie (Director, Business Support Finance Services)
• Stephen Rimmer (Director, Strategic Management and Performance)
• Paul Stock (Director, Strategic Finance)

1. Apologies for absence

(Agenda item 1)

Apologies for absence were received from Anthony Arbour, Richard Barnes Dee Doocey and Elizabeth Howlett (members).

2. Appointment of Chair

(Agenda item 2)

Resolved – That Graham Tope, Chair of the Finance Committee, be appointed Chair.

3. Declarations of interests

(Agenda item 3)

No declarations of interest were received.

4. Corporate business planning update

(Agenda item 7)

Members received a report updating members on the integrated strategic financial/planning framework including the development of the corporate business plan. The report had been circulated to members with less than five clear working days’ notice, however the Chair agreed to receive it as an urgent item under the provisions of section 100B (4b) of the Local Government Act 1972 because of the need to adhere to the financial/planning timetable.

Members were asked to view the report as ‘work in progress’ and note that it was the first time the MPS had attempted such a process. The MPS’s Management Board would be considering the draft framework in the following week.

Members queried the timeframe outlined in the report, pointing out that the MPA had originally planned to hold one joint meeting of the Finance and Planning Performance and Review Committees in October, but had rescheduled the dates to meet now and in November to fit in with the Mayor’s timetable. The report however stated that the draft corporate business plan would be submitted to the full Authority in October. The Director, Strategic Management and Performance, stated that the Commissioner had assured him that the corporate business plan would be submitted to the Mayor after the full Authority in October. Members were concerned that they had not been informed of this agreement and felt this timetable was unacceptable. The Treasurer agreed and stated that the budget submission, incorporating the business plan, must be submitted to the full Authority in November, though the Mayor might be provided with a draft a few days before it was agreed by the MPA but that any such draft would be subject to members’ approval.

Members felt the framework of the corporate business plan lacked outcomes, and awaited the completed plan with interest. At the last Finance Committee members had felt the Authority should have a role in the work of the MPS’s Investment Board. The Treasurer stated that he had recently asked for all Investment Board reports.

Resolved - That

1. the activities being undertaken in the integrated strategic financial/planning framework including the development of the corporate business plan be noted; and
2. that the corporate business plan be submitted to the full Authority in November, not October as outlined in the report.

5. Revenue budget 2007/08 to 2009/10

(Agenda item 5)

The last update on the financial envelope received by the Finance Committee in June 2006 indicated an excess of expenditure over income of £116.1m in 2007/08 and further projected budget shortfalls of £29.3m and £40.3m in 2008/09 and 2009/10 respectively. Members received a report showing that the budget shortfall for 2007/08 had been narrowed to £91.3m before savings and other movements arising from business group business plans were taken into account. The funding shortfalls in 2008/09 and 2009/10 were now £33.7m and £51.5m respectively. The report noted that there was a requirement for initial information on the budget position to be submitted to the Mayor by the end of September 2006. The report had been circulated to members with less than five clear working days’ notice, however the Chair agreed to receive it as an urgent item under the provisions of section 100B (4b) of the Local Government Act 1972 because it required no decision and updated members on the current financial position.

Members were informed that the report highlighted the large strides taken by the MPS in financial planning and joint working to manage the budget. Members asked which savings were ‘one offs’ and which could be carried through to future years, about risk analysis and about income generation (for example in policing the Olympics). Members were assured these issues were in hand. With regard to the funding of dedicated security posts, members were informed that a business case would be submitted to the Home Office, but great success was not anticipated. Members also asked about the effect of workforce modernisation on the budget. They were informed that it was a critical priority to maintain capacity around front line delivery. A request was made to see proposals around Crime Fighting Fund flexibility in the future).

Resolved - That

1. the latest revenue budget projections for 2007/08 to 2009/10 as set out in Appendix 1 be noted;
2. the updated financial projection tables attached at Appendix 3 be submitted to the Mayor at the end of September 2006; and
3. the need to address the probable requirement to replenish the Emergencies Contingency Fund (£20.1m) as part of the budget or closing of accounts process be noted, and a report be received by the Finance Committee on suggested future actions.

6. Draft capital programme 2007/08 to 2009/10

(Agenda item 6)

This report provided details of progress on the capital programme for 2007/08 to 2009/10 and information on proposed revisions to the current capital investment plan, including requirements submitted as part of the current business planning process. It also proposed the capitalisation of internal staff costs. The report had been circulated to members with less than five clear working days’ notice, however the Chair agreed to receive it as an urgent item under the provisions of section 100B (4b) of the Local Government Act 1972 because of the need to adhere to the financial/planning timetable.

The Treasurer reported that the draft programme now showed the latest bid being £180M. not £140M. for 2007/08 – a substantial increase which was financed by additional estimated capital receipts from the sale of operational properties.

With regard to the anticipated slippage on property based capital projects reported in paragraph 8, members requested a rigorous debate and an option paper. In relation to paragraph 14, members asked if there would be fewer external consultants in future. They were informed that it was intended to make maximum use of existing senior staff as part of corporate efficiency saving. A briefing paper on this subject was requested.

Resolved - That

1. this first draft of the capital programme 2007/08 to 2009/10 (paragraph 6 and appendix 1) be noted;
2. the proposed funding of the programme (appendix 1) be noted;
3. the capitalisation of internal staff costs directly related to the delivery of capital projects (paragraph 13), as required by the CIPFA SORP be approved; and
4. a briefing paper on the respective costs of using consultants and senior staff be provided.

7. Sustainable development budget return

(Agenda item 4)

Members received a report explaining that sustainable development was seen by the GLA as creating a better quality of life for people, both now and in the future and setting a context within which the Mayor’s objectives of economic development, social inclusion and environmental improvement could be achieved in a balanced manner over the long term. Before budget proposals were issued for consultation in December, it was intended that the Mayor would be informed of how these issues would be delivered, in terms of service plans, targets and programmes, and of any material budget and resource issues. In line with the Mayor’s budget guidance, the MPS had provided details of plans, priorities and budget to deliver on three strands of sustainable development. The report had been circulated to members with less than five clear working days’ notice, however the Chair agreed to receive it as an urgent item under the provisions of section 100B (4b) of the Local Government Act 1972 because the Sustainable Development Budget had to be approved by members prior to submission to the GLA by the end of September 2006.

Whilst some members welcomed the report, other members questioned some of the matters included in the Mayor’s definition of ‘sustainable development’, such as equalities, and felt this should be challenged. AC House offered members a briefing with colleagues from the GLA.

Resolved – (with Rachel Whittaker asking that her dissent be recorded) That the Sustainable Development budget return members be approved prior to submission to the Greater London Authority (GLA) by the end of September 2006.

The joint meeting ended at 3.15 pm.

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