Agenda item

To receive any questions relating to items on the Agenda from members of the public and replies thereto.

 

The following questions were received from members of the public:

 

Paul Elstone

 

My questions relate to Agenda Item 6 2023/24 Quarter 2 Budget Monitoring

 

Question 1

A 3 Rivers Development estimated write off amount of £3.7 million is shown for 2023/24. Is this in addition to £4.5 million impairment previously stated by the S151 Officer in June 2023?

 

Answer

£3.7m is the impairment we believe is the figure that will need to be accounted for within the 23/24 year. I would reiterate that this is still an estimate based on a number of future costs and receipts and will be confirmed within the Outturn report. 

 

Question 2

Since the formation of 3 Rivers what is the total amount of 3 Rivers impairment or 

write-offs that so far needs to be accounted for in Council accounts?

 

Answer

The value of approved impairments that is accounted for within the Council’s accounts as of 31 March 2023 is £5.317m.

 

Question 3

I understand that the 3 Rivers start-up cost was estimated at £1 million, can this amount be confirmed.  If not £1 million, what was the start-up cost?

 

Answer

I haven’t seen the estimation that you refer to and I would be interested to understand the inclusions and calculations and I am very happy if Mr Elstone wishes to share this with me but my understanding is that the start up costs to create 3Rivers were around £200k - £250k.

 

Question 4

Has the 3 Rivers start-up cost also been impaired, in the Councils accounts, if not why not?

 

Answer

Yes, loans are impaired, not specific costs or projects. I understand the start-up costs were funded from a loan that had previously been impaired.

 

Question 5

In March 2022 the Earmarked Reserves were shown as £20.6 million.

In March 2023 the reserves were £18.1 million.

Now in March 2024 reserves are being estimated at £15.9 million therefore being very seriously eroded. 

 

Does the estimated year end figure for Earmarked Reserves fully include the 3Rivers known loss provisions?

 

Answer

No, the Council holds Earmarked Reserves for a number of legal requirements, for example S106 Planning obligations and ring fenced Government grants for specific schemes. In addition we make prudent provisions for estimated future known costs such as asset replacements and future projects. As we have impaired the forecasted future loan write-off, there is no need to create a reserve.

 

Question 6

An important financial health indicator is the percentage of reserves held against the Council’s annual spend.  

 

When the current known 3Rivers impairments and write-offs are accounted for what will this percentage be? 

 

Answer

Your question is probably based on an incorrect interpretation or misunderstanding. It would be helpful to explain that the Council’s General Fund has two types of reserves. Firstly Earmarked Reserves which, as explained in the answer to question 5 includes a number of legal requirements e.g. S106 Planning obligations and ring fenced Government grants for specific schemes and in addition they enable us to make prudent provision for unknown future costs such as asset replacements and future projects. There is no maximum or minimum amount for these reserves as your question suggests but it is essential that the Council is prudent when setting these. Secondly the Council maintains a general reserve, the minimum level of this reserve is set by full Council on the advice of the S151 Officer and adherence to this minimum level is perhaps an indicator of financial health or more likely an indicator of prudent fiscal responsibility.

 

It is worthy to note that the previous administration approved the budget which drew £600k from the General Reserve balance to an unfunded budget putting the Reserve well below the minimum amount. You may recall I asked the then caretaker Leader in March 2023 to reconsider this, they chose not to. You will note that in the Q2 update report, this administration, in conjunction with officers, has worked hard to reverse this and return to a position of fiscal responsibility and the intention is to maintain a general reserve that is recommended by the Council’s S151 Officer which is currently £2m.

 

Question 7

What exactly are the sinking funds mentioned? 

 

Answer

As alluded to in question 5, the Council’s holds a number of funds for essential replacements of assets that wear out e.g. buildings, vehicles and some plant and equipment. This is based on replacement costs and estimated life spans.

 

Question 8

How much exactly is held in these sinking fund accounts? 

 

Answer

You asked exactly how much is held in these sinking fund accounts? So the balance is, as at 31 March 2023:

 

£530k in ICT equipment

£1.4m in vehicle fleet

£780k in waste plant and infrastructure

£267k in Phoenix House

£830k in property maintenance

£880k in Leisure Centres and equipment

£270k in parks and open spaces

 

There are some other smaller reserves but these are for the key EMR sinking funds. 

 

The implication of reallocating these to cover losses are how we fund maintenance going forwards (as maintenance is a revenue cost so we can’t borrow).

 

Question 9 (submitted at the meeting and not in advance)

 

The minutes of the full Council meeting held on 1 November 2023, and in an answer to a public question state that 3Rivers loan capital has risen to over £27m yet at the meeting we were told it was nearly £23m I believe, what is it, is it £27m or £22.7m?

 

Answer

I can say that the total loans outstanding as at 30 September 2023 was £22.363m.

 

Barry Warren

 

My questions are prompted by the content of Agenda item 6.

 

I recall being assured by the Cabinet Member for Finance at an earlier meeting that all decisions were made by members but then in answer to another question in relation to commissioning an external report I was advised that the decision was made by officers. An apparent contradiction.

 

It is noted that the four recommendations in the report the first three are for the Cabinet to note them. a) is self explanatory and I have no query on this.

 

Presumably decisions under b) were made by the S151 Officer in accord with procedure and the Cabinet are being informed but are Cabinet able to question or overturn any of these decisions?

 

In the case of recommendation c) the Cabinet are asked to note a write off of £3.7 million and are told where the funding will come from. 

 

Is this a case of Officers making the decisions and Cabinet are asked to note it without any input?  Should such a decision be made by elected members on information and advice from officers?

 

In the case of d) Cabinet are asked to agree the virement of the capital approval from the Hydromills project and to be replaced by investment in solar panels.  I cannot find any further reference to this in the body of the report but there is a note in Appendix F against Code CA582 – ‘Feasibility works to be undertaken on alternative solar options.’

 

When and where was the decision made that the Hydromills project was unviable please?

 

Is it prudent to make a decision as to the use of the monies previously allocated to a different project without knowing the detail of the location(s) of the proposed solar panels and the detail of their cost and use?

 

Is it prudent to make such an open ended decision?

 

Answers

The Cabinet Member for Finance responded by stating that… he was not entirely sure when the contradiction took place that Mr Warren was referring to so to aid Mr Warren I shall repeat the answer I gave to a public question at the Cabinet meeting in August this year which was that…it is clear to me that poor decisions have been made by councillors in the past particularly in previous administrations likely due to their commitment bias to a failing and unviable project. These poor decisions and in some cases indecisions has resulted in a most serious situation for this Council with significant financial implications. I want to be really clear about this. Every decision to lend money or support a decision for a project was always made by councillors and in particular the Leader and the Cabinet at the time. Many, if not all, responsible for these poor decisions are no longer part of this Council, perhaps that is telling enough.

 

While I stand by this answer Members know that officers must make decisions all the time and of course there are also decisions that have been specifically delegated to senior officers. The Council simply would not function effectively, if at all, if every decision needed to come through a Committee.

 

On to the other questions…

 

b) In reference to the procurement waivers the Council’s S151 Officer has been specifically delegated to make these decisions. Delegated to by Members, Members who made the decision to delegate.  All Members have the opportunity to question and scrutinise all decisions of a delegated nature including procurement waivers.

 

c) Cabinet are asked to note the forecasted position. A full breakdown of this position has been provided to Members and there will likely be questions from Members on this. The decision to formally recommend write-off and approve the virements to fund these will be made by Members with the advice from the Council’s S151 Officer when approving the 23/24 Outturn report. This is made very clear within the report and the recommendations.

 

d) A significant amount of office time has been spent over the years considering this project which has been fed back to a number of Council meetings. Due to the complexity of this potential scheme and the associated permissions that would be required from third parties it is felt not worth pursuing at this stage. The new project will require a detailed business case to be made by the Leadership Team prior to formally allocating a precise budget. These considerations will be fed back to Cabinet for investigation before any investment is made.

 

 

Nick Quinn

 

My first question concerns Agenda Item 4 – Minutes of the previous meeting

 

Q1 – In the minutes of the previous meeting of Cabinet, the answer shown to my question number 3 is incomplete. Will the Leader, and/or the Cabinet Member for Finance, please correct this by giving a more complete, and accurate, answer to that question – and ask for this to be recorded in the minutes of this meeting?

 

 

My next questions relate to Agenda Item 6 – Quarter 2 Budget Monitoring

 

The first line of Appendix D shows the ‘Annual Budget’ for employee costs in Corporate Management as £331,200 and then uses the P6 Profiled and P6 Actual spend to produce a likely Full Year Variance – giving a calculated Corporate Management overspend of £215,000 (or 64.9%).

 

But on the first line of Appendix B, this shows there is an actual annual saving on Corporate Management of £85k - but then takes this away from a Cumulative Salary savings target of £300k (across all other services) resulting in a forecast overspend, shown against Corporate Management, of £215k.

 

This statement is incorrect, “Corporate Management” is not overspending at all. It is a salary savings target, covering the whole Council, that is not being achieved.

 

Lumping a Council-wide target into an individual service area is confusing and provides inaccurate indications of actual, and projected, service costs.

 

Q2. Why are Members being given reports that provide confusing and inaccurate indications, such as the overspend figure shown against Corporate Management?

 

Q3. The £300k, cross Council, salary savings target has only been reduced by the £85k saving in Corporate Management. Have none of the other service area headings had any salary savings, to reduce the total further?

 

Answer

Q1. At the last Cabinet meeting on 17th October, Mr Quinn asked a number of questions regarding the Agenda Item 8 – Medium Term Financial Update, these questions and answers are shown within the minutes of that meeting.

In particular, he asked:

“Q3: Licensing is shown as a statutory function. How can a budget of £24k be reduced to just £4k and still provide the required Statutory service?”

My answer given at the meeting was “The budget is net of income. The specific savings options are shown in Appendix 2, rows 15 & 17”

It was unfortunate that I could not communicate with Mr Quinn during the meeting and as such Mr Quinn had to wait until after the meeting to query this response and it was identified that I had made a mistake with this answer, in that the specific savings were shown in rows 15, 17, 18 and 19 and not just 15 and 17 as answered at the meeting. 

While I have corrected this with Mr Quinn and provided a further explanation and an unreserved apology for my oversight, Mr Quinn has asked that I publicly correct the answer, and I am happy to do so, therefore the revised answer to the third question asked by Mr Quinn on 17th October is:

The savings in appendix 1 attributed to “Licensing” relate to rows 15, 17, 18 and 19 in appendix 2.

For the avoidance of doubt, the savings attributed to “Licencing” are.

15 - Removal of pest control.

17 - Removal of the revenue budget for Air Quality Monitoring (but utilisation of s106 funds is being explored).

18 - Reduction of NOx monitoring.

19 - Removal of the provision of planning advice to public health.

The resulting budget proposal of £4,000 for licencing is net of income and subject to rounding.

 

 

Q2, I can’t agree with the statement that was made. I certainly haven’t had any Members raise any concerns with me, indeed we have regular updates and briefings and these are given to all Members and I am always happy to receive feedback from Members and work with officers to ensure that information provided to them is clear and easy to understand and importantly fulfils the need they have for said information. Likewise I am happy to engage with other residents if they feel that information can be presented to them in an easy to understand way and I will take on board Mr Quinn’s feedback. To answer the question of the £400k unidentified salary savings in the 23/24 budget, £300k was assigned to Corporate Management to identify savings and a £100k specific to the service delivery areas.

 

Q3, The Corporate Salary Saving Target is included within the Corporate Management area – along with other corporate costs. The actual savings are shown where the savings are achieved. This is explained in the report (para 3.4).

 

Tim Bridger

 

All public servants whether paid or elected are expected to abide by the Nolan Principles of public life. These seven principles are selflessness, integrity, objectivity, accountability, openness, honesty and leadership. These are important elements of public service, important for outcomes of good governance, ethical culture and legitimacy. Where in those principles does it state that intimidating members of the public arriving at meetings, suppressing debate and legitimate comment, labelling tax payers as ‘scurrilous’ and using threatening advice of the paid staff to those same

members of the public, are acceptable behaviours under those principles?

 

Secondly, agenda item 12, Leisure Pricing….the public are not satisfied that this discussion should be taking place without public scrutiny. To date there have been three changes of approach to the Leisure Centre refund. Firstly that it will be used to offset bad debt which was back in June time. Secondly following a Motion by Cllr Woollatt that the money would not be used in such a way and thirdly that it will be used like a previously unmentioned annual loss to the tax payer of either £1.8m or £2.1m depending on whether you include missed membership targets. The inconsistencies of this approach have only been highlighted and u-turns forced through public scrutiny. To the public, excluding item 12 from public debate looks very much like a fourth approach in as many months. That will not see value for money to the tax payer. This is precisely the sort of decision being made behind closed doors which so enraged the Lib Dems when they were in opposition but seems to be the go-to mode not only now that they have moved into the Cabinet system but decided to keep it despite the clear decision 6 months ago to move to a Committee structure.

 

Fourthly the options for the car parking spaces in Halberton…. the Cabinet’s documents state that there are 5 parking spaces out of 6 made for sale by 3 Rivers Developments. Checking today on Right Move there is only one space remaining, however, looking at the sales, it was previously for sale at £10k and then on 6^th October that was reduced to £5k which is quite a significant discount and I am sure you want to correct the impression that this is a ‘fire sale’ of asset. Given that MDDC revenue is affected, can the S151 Officer and the Cabinet Member for Finance give their approval for this very substantial price cut?

 

The Leader responded by stating that councillors absolutely complied with the Nolan Principles and if anybody had a complaint about a councillor this could be taken to Standards Committee. As regards discussing the Leisure pricing item in Part II, he hoped Mr Bridger could appreciate the sensitivities involved and the commercial nature around that particular agenda item seeing as the Council wanted to provide good value at the Leisure Centres which obviously faced a lot of competition whereas if the Cabinet were to discuss that in the public domain he was sure Mr Bridger wouldn’t want the Council to be losing revenue to it’s competition.

 

Ian Batchelor

 

3 Rivers developed a site near the eastern boundary of Halberton a number of years ago for residential use. Part of the site was the creation of a car park. This was in addition to parking provision provided for the new residents of the development. This new car park, the parish was led to believe, would help alleviate parking problems in that area and make the road safer for pedestrians and road users both travelling through Halberton and emerging from the new development.

 

It came to the Parish Council’s attention in April 2022 that the car parking spaces were being offered for sale. The concerns we had were that the unregulated sale of the spaces would not help alleviate the problems of parking at that end of the village and the area would continue to be a danger for both pedestrians and motorists. We raised our concerns with our then District councillor and planning enforcement but no satisfactory conclusions have emerged until our new councillor has attempted to look at the situation again.

 

I am asking on behalf of the residents of Halberton that the council is minded to right a wrong and allow the parking spaces in Mid Devon District Councils control to be offered to be used for the good of all in the area and the most needy have an opportunity to park somewhere less dangerous. We are asking for the council to look at the legality of the current sale of these parking spaces and at what good could be achieved if this space was managed by the community for the community.

 

(The issue of parking spaces in Halberton was considered as a specific item on the agenda, with a decision being made as indicated in these minutes.)

 

The Leader stated that any unanswered questions would be responded to in writing in due course.