Agenda and minutes

To approve as correct the minutes of the meeting held on Monday 25 September 2023

(Note: If any Member wishes to propose an amendment to the minutes they should submit this in writing to committeeservices@horsham.gov.uk at least 24 hours before the meeting.  Where applicable, the audio recording of the meeting will be checked to ensure the accuracy of the proposed amendment.)

The minutes of the meeting held on 25 September 2023 were approved as a true record and signed by the Chairman.

To receive any declarations of interest from Members of the Committee

There were no declarations of interest.

To receive any announcements from the Chairman of the Committee or the Chief Executive

The Chairman announced at the commencement of the meeting that works to Swan Walk car park would be considered under ‘Urgent Business’.

To receive a report from the Director of Resources and to ask questions of the Cabinet Member for Finance and Resources

The Chairman welcomed the Cabinet Member for Finance and Resources to the meeting.

The Director of Resources introduced the report on the Council’s finance and performance. The report identified the revenue position as at month six, capital expenditure as at month seven, and performance for quarter two.

In terms of revenue performance, an overspend of £250,000 was forecasted as at month six.

In terms of the capital programme, expenditure as at month seven was £9.5 million, which was considerably higher than the total expenditure for the previous year which was £5.2 million. Forecasted expenditure for the year was £14.8 million, which equated to approximately 87%. This compared to 43% the previous year. The Council’s Finance team had challenged that forecast and it was considered to be realistic. The position was helped significantly by the Local Authority Housing Fund (LAHF) spend, for which the budget was £7.65 million. Of the £9.3 million which did not relate to the LAHF, forecasted expenditure for the year was £7.1 million or 77%.

Key performance indicators for the second quarter (where available) were provided in Appendix A to the report. Performance had improved since the previous quarter.

Throughout the presentation, the Director of Resources answered questions that had been submitted in advance as well as those that were put to him during the meeting. Among the matters raised were:

Revenue

• How the Council planned to fix the projected deficit. The Director of Resources explained that historically budget holders had underestimated income and overestimated expenditure; if history repeated itself, the position should improve of its own accord by the end of the year. He had reminded budget holders of the importance of not being pessimistic on income and had challenged them on expenditure. If the position did not improve by quarter three, there was still time for action to be taken and, ultimately, there were reserves available to cover the overspend.
• Why there had been such a big increase in spending compared to the previous year and how the Council planned to handle this by the end of the current year and in future years. The Director of Resources advised that this was largely due to high inflation. Salaries had increased, there was continued demand for bed and breakfast and temporary accommodation, and Planning income had reduced due to water neutrality. Expenditure would increase for the rest of the current year and could also increase the following year. Increased expenditure was being offset by treasury management investment income, which presented a significant risk as a reduction in treasury management balances or the interest rate would lead to a reduction in that income. The Medium-Term Financial Strategy detailed how the Council planned to handle the situation in future years.
• Whether it was normal for debt older than 90 days to continue to increase or if this was likely to decrease. The Director of Resources assured Members that the Legal and Planning departments were working hard on resolving these matters and he was hopeful that this would yield  ...  view the full minutes text for item SO/35

To receive an update from the Director of Resources and to ask questions of the Cabinet Member for Finance and Resources

The Director of Resources gave an update on the Council’s Medium-Term Financial Strategy, in respect of which a draft report had been circulated to Members in advance of the meeting.

He advised that the Medium-Term Financial Strategy was largely based on assumptions and estimates which created uncertainty, and the figures for later years would be less accurate than those for earlier years. The figures were subject to adjustment as the Finance team continued to update the budget system and challenge budget holders.

As to the 2024/25 financial year, assumptions had been made that government funding would largely be the same as for the 2023/24 financial year and that Council Tax would increase by 2.99%. As well as significant inflationary and salary pressures, there would also be one-off items of expenditure. These included an increase in external audit fees of £100,000, which the Council had no control over. Net expenditure was expected to increase by £0.5 million compared to the 2023/24 financial year. In order to balance its budget, the Council needed to increase its income or reduce its expenditure by reshaping its services. In that regard, changes to the Council’s fees and charges, including garden waste and multi-storey car park passes, were proposed. Overall, it was expected that the Council would largely be able to balance its budget in 2024/25.

As to the position beyond 2024/25, inflationary and salary pressures would continue. Other pressures included the introduction of food waste collections, which could have an annual cost of between £1.5 million and £1.8 million in the later years, the costs of decarbonisation which were estimated to be between £10 million and £12 million, and the loss of Planning income due to water neutrality. It was also anticipated that the temporary funding guarantee grant from government would be removed, although this had not been included in the Council’s revenue budget. The Director of Resources drew Members’ attention to the impact that big capital projects such as updating The Capitol would have on the Council’s financial position.

Following the presentation, the Cabinet Member for Finance and Resources answered questions that had been submitted in advance as well as those that were put to him during the meeting. Among the points raised were:

• What the Council’s strategy was for identifying and managing demands on capital that were required to reach the Council’s 2030 carbon neutrality target. The Cabinet Member advised that the strategy needed to be developed as the Council was working with imperfect data. Work was being undertaken in relation to understanding the financial costs of achieving net zero. The Capitol was being prioritised as it was also in need of refurbishment. Other assets such as leisure centres would also be addressed, although technically these were included in the Council’s 2050 carbon neutrality target.
• The cost of maintaining Council Tax support at £195 for one year and over the Medium-Term Financial Strategy period. The Cabinet Member advised that the projected total cost for 2024/25 was around £0.5 million. This would be funded  ...  view the full minutes text for item SO/36

To receive an update from the Fair Space Task and Finish Group

Councillor Bateman provided an update on the progress of the Fair Space Task and Finish Group. She advised that she had been asked to chair the Group and the Group had started working through its terms of reference. The Group had identified which policies it might like to review and would be meeting in early January to decide what improvements and adaptations might be required to be made to them. The Group also intended to look at equalities impact assessments in the context of policy implementation.

The Chairman advised that he was considering setting up a Task and Finish Group looking at the monitoring of section 106 agreements, including matters such as the transfer of public open spaces. He had been advised that the Council’s internal audit team was looking at the section 106 system and he was waiting to hear what their remit was in order to avoid duplicating work. He agreed to come back to the Committee with his proposals.

The Chairman also advised that he was in discussions with the Chair of the Governance Committee in relation to other matters that might be considered by either an Overview and Scrutiny Task and Finish Group or the Governance Committee. He agreed to keep the Committee informed.

To review the current Overview and Scrutiny Work Programme

The Overview and Scrutiny work programme was noted.

To review the current Forward Plan

Members considered the Cabinet Forward Plan and raised the following points:

• The creation of a new Head of Service post and the Shelley Memorial Partnership were welcomed.
• A point was made in relation to avoiding local government jargon when naming posts.
• Clarity was sought on the correct contact officer for the review of polling districts and polling places. The Democratic Services Officer advised that the reason Jane Eaton was the contact officer was because she was the Returning Officer.
• It was considered that the name ‘Wells Cottages Conservation Area’ was misleading as the conservation area did not only protect Wells Cottages. It was also noted that historical photographs of the affected roads were shown at the last Cabinet meeting where the item was considered, and it was thought to be more logical for up-to-date photographs to be shown. The Chairman agreed to contact the Head of Strategic Planning and the Cabinet Member for Planning and Infrastructure in relation to these points.

Items not on the agenda which the Chairman of the meeting is of the opinion should be considered as urgent because of the special circumstances

The Property Management Team Leader gave an update on the works to the Swan Walk car park. The membrane that had been removed from the top floor of the car park needed to be replaced. This matter had become reasonably urgent due to the change in temperature, which affected the ability to undertake repairs, and the fact that the surface was now exposed to rain. The Council would also be able to generate revenue from the area once it was operational again. The Council had been out to tender for the remainder of the works and a further budget of £298,845 to that which had previously been agreed was required. The tender price was fixed for 30 days.

Following the update, the Property Management Team Leader took questions from Members. Among the matters raised were:

Swan Walk car park maintenance

·         Whether the car park had been deemed unsafe. The Property Management Team Leader advised that the car park was not unsafe but there was potential for further deterioration.

·         In relation to the timescale for completing the works, the Property Management Team Leader advised that a period of ten weeks had been given but the contractor and their manufacturer believed that the works could be completed two weeks before Christmas.

·         The expected loss of revenue and whether it was worth pushing to get the works finished before Christmas, given that it was a busy period. The Director of Resources advised that revenue of up to around £180,000 could be lost in a worst-case scenario. The Council would do everything it could to try to mitigate this, including opening up other areas for car parking. He acknowledged that there was a trade-off between spending more but reducing the timescale and not spending more but losing revenue if the works took longer. He added that he did not, however, think that the Council could afford to wait until the temperature had risen in April to undertake the works, as the price could have increased by then.

·         What the Council could do to address residents’ concerns. The Director of Resources advised that ‘park and ride’ was operating at Hop Oast and there were other car parks available. Whilst residents might be inconvenienced, he did not think that car parking would be a significant issue.

·         Whether there was a risk that the Council was paying a premium due to the short lead time. The Property Management Team Leader advised that a minor amount of the tender price reflected the short lead time. 

·         On what basis the contract was awarded. The Property Management Team Leader advised that it was awarded based on price.

·         Whether the damage would have been minimised, and the repair costs would have been much less, had the membrane been replaced eight years ago, which was when its guarantee had expired. The Property Management Team Leader advised that the membrane would have deteriorated more over those eight years, but it was able to be used for a further eight years. As to the  ...  view the full minutes text for item SO/40