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ITEM CA5

CABINET – 18 JULY 2006

FINANCIAL MONITORING

Report by Head of Finance & Procurement

1. This report covers the period up to the end of May 2006 for revenue and capital. The consolidated revenue forecast for the year-end shows a balance of £14.971m (para 77). This is made up of £15.690m general balances and a forecast directorate overspend of £0.719m (net of City Schools).

Revenue

Children, Young People & Families

2. The current forecast outturn position for Children, Young People & Families is a year-end overspend of £0.551m (para 22).
3. Of this, the Early Years and Family Support service predicts a £0.451m overspend, of which £0.641m overspend relates to the budget for Agency placements (para 27). The Asylum Seekers budget is currently predicting a £0.071m overspend although there is a great amount of uncertainty in this area (para 30). Within the same service area an overspend of £0.061m is forecast for Assessment and Family Support. An underspend of £0.421m is being retained centrally within the service area pending the completion of a review of the service (para 32).
4. The current commitments for Premature Retirement Compensation are less than the allocated budget (para 35). However, a further 22 cases are to be considered by the Pension Benefits Sub-Committee in July. This could lead to an overspend of up to £0.150m.

Social & Community Services

5. The forecast outturn for Social & Community Services is an overspend of £0.266m excluding Supporting People.
6. The Social Care for Adults service is predicting a £0.954m overspend. Within this, the budget for older people currently forecasts an overspend of £0.619m (para 39). The overspend is expected to be partially offset by an underspend of £0.177m in external home support. A £0.200m pressure relating to achieving Fairer Charging Income has been identified. The care management team currently forecasts an overspend of £0.140m and the Physical Disabilities budget is predicted to overspend by £0.273m.
7. The Partnership & Planning forecast outturn is a £0.428m overspend (para 42), of which the County Council’s contribution to the Learning Disabilities Pool is showing a forecast overspend of £0.328m.
8. Within the Directorate Management Team, there is a predicted underspend of £1.163m (para 44). This primarily relates to the contingency, which has a budget of £1.313m and no spend allocated to it yet. However, a total of £1.306m has been ringfenced to meet currently identified pressures.
9. The forecast outturn for Supporting People is a £0.358m underspend (para 46).

Environment & Economy

10. There is no variation forecast for Environment & Economy.
11. Waste Management is the highest risk area and the service is progressing steadily in the procurement process for a waste treatment contract. The break-even position takes into account a proposed transfer of both the £0.253m carry forward from 2005/06 and £0.231m from in-year underspends into the Waste Management earmarked reserve (para 51).

Resources & Chief Executive’s Office

12. The forecast directorate overspend is £0.310m, which primarily relates to an overspend of around £0.300m on the SAP Revitalisation Project (para 62). This is a cash flow issue as it will be managed by a corresponding underspend next year.
13. At the end of 2005/06, the Modernisation Fund underspend was transferred to an earmarked reserve. It is proposed to transfer the budget allocation for 2006/07 of £0.489m into the reserve and then draw down the reserve to fund successful bids (para 65). The successful bids to date this year amount to £0.376m.

Council Balances

14. The forecast year-end position for general balances has increased by a net £0.558m from the previously reported position to £15.690m (para 73).

Capital

15. An updated Capital Programme (download as .pdf file) is circulated with this report. This programme rolls forward the 2005/06 actuals and updates the capital programme for the period 2006/07 to 2008/09. Individual schemes have been re-phased accordingly.
16. The capital programme shows an overall surplus of £0.918m that can be used to fund new schemes up to 2008/09.
17. The capital cash flow shows a surplus of £11.0m in 2006/07 and a £15.4m shortfall in 2007/08. There are contingency plans in place to ensure that there will be sufficient cash to deliver the programme.

INTRODUCTION

18. This report covers the period up to the end of May 2006 for revenue and capital. The detail for each Directorate is summarised within the report and individual reports for each Directorate are in the Members’ Resource Centre.

Annexes

19. The following annexes are attached: (download as .xls file)

Revenue

Annex 1 Estimated Year End Position Directorate Summary

Annex 1a-1e " " " by Directorate

Annex 2a Summary of Virements

Annex 2b Summary of Supplementary Estimates

Annex 3 Latest Grants Position

Annex 4 Earmarked Reserves

Annex 5 Forecast Revenue Balances at Year End

Capital

- Updated Capital Programme (download as .pdf file)

PART 1 - REVENUE

20. Annex 1 shows the forecast revenue outturn position at the end of May. The overall projected in-year variance for the Council is set out in the table below (positive variances represent overspends and negative variances represent underspends) :

	Year End Variation
	£m
Children, Young People & Families	3.084
Less City Schools Reorganisation	2.533
	0.551
Social & Community Services (excl. Supporting People)	0.266
Supporting People	-0.358
Environment & Economy	0.000
Community Safety	-0.050
Resources & Chief Executive’s Office	0.310
Total Variation	0.719

21. The main issues on the revenue budget for each directorate are set out below.

Children, Young People & Families (£0.551m in-year overspend)

22. The current forecast outturn position shows a projected overspend of £3.084m. Of this £0.551m relates to the current financial year and £2.533m relates to the planned overspend on the City Schools Reorganisation, which is being repaid over a number of years.

	Year End Variation
	£m
Children & Young People	0.071
Early Years & Family Support	0.451
Educational Effectiveness	0.000
Strategy & Performance	0.029
Total in year variation	0.551
City Schools Reorganisation	2.533
Total Variation	3.084

Dedicated Schools Grant (DSG)

23. From April 2006 Schools Block services are funded by the Dedicated Schools Grant. This will impact on the treatment of under or overspends for central items within the Schools Block budget. Any unspent grant must be carried forward to support the Schools Block budget in future years; it cannot be used to offset overspends on non-Schools Block services. The Council has three options for dealing with any overspends on central Schools Block items:

• Fund the overspend from County Fund.
• Fund part of the overspend and carry forward the remaining element.
• Carry forward the overspend to the next financial year and fund from DSG.

24. No variation is forecast for Home to School Transport at present. However, given the large increase in spend on this budget over the last 2 years, there is a risk that the strenuous actions being taken following new management arrangements may not achieve a balanced budget by year-end.
25. Statementing and Out of County budgets are central expenditure items within the Schools Block. No variation is forecast for these budget heads at present. However, given the volatile and demand led nature of these budgets it is too early to be confident about year-end projections.
26. The Service for disabled children is currently forecasting an overspend of £0.071m, the main cause of this pressure being the cost of the Resource Centres for children with disabilities. The budget for agency residential placements is currently forecast to break-even. However, given the cost of such placements this remains an area where there is significant risk.

Early Years & Family Support (£0.451m overspend)

27. The budget for Agency placements is forecast to overspend by £0.641m. This is split between £0.060m on residential placements and £0.581m on placements with independent fostering agencies. A service review is currently being undertaken (para 32).
28. No variation is currently predicted for Children’s Homes, although this remains a significant risk area as budgets have frequently been overspent in recent years.
29. Based on current commitments, there is currently no variation forecast for Leaving Care. However, it is likely that this budget will come under pressure later in the year due to the numbers of young people likely to leave care during the year and the level of support they are likely to require.
30. The Asylum Seekers budget is currently predicting a £0.071m overspend. However, there is a great amount of uncertainty in this area as follows:

• Over the past year there has been a significant reduction in the numbers of asylum seekers supported following the transfer of responsibility for new families and adults to the National Asylum Seekers Service (NASS). The County Council service now supports only unaccompanied asylum seeking children (UASCs). A reduction in grant funding has led to a situation where the current structure is no longer financially viable and a review is being undertaken to address this problem.
• The Home Office grant has not been subject to full audit since 2001/02 due to problems with data matching systems. Any disputes over eligibility for support may impact on the amount of grant receivable.
• The final allocation of Safeguarding Children grant is not due to be announced until September 2007.

31. An overspend of £0.061m is forecast for Assessment and Family Support. This is mainly in respect of the cost of residence orders.
32. An underspend of £0.421m is currently being retained centrally within the service area. This is the balance of funding allocated during the 2006/07 budget process yet to be allocated. It is anticipated on completion of the current service review and its budgets, this will be allocated either to offset the overspends above or to preventative measures designed to reduce the pressures in those budgets.

Educational Effectiveness (no variation forecast)

33. It is not anticipated that Educational Effectiveness will overspend its budget in 2006/07. Given the restructuring of the service there is a considerable amount of work that is currently being undertaken to align budgets with the new management structure. County Facilities Management (CFM) are forecasting to achieve a break-even position for the financial year.

Strategy & Performance (£0.029m overspend)

34. The actual cost of trade union representatives funded by the directorate exceeds the current budget by £0.029m.
35. The current commitments for Premature Retirement Compensation are less than the allocated budget. However, a further 22 cases are to be considered by the Pension Benefits Sub-Committee in July; these are estimated to cost up to £0.225m. This could lead to an overspend of up to £0.150m (depending on contributions received from schools).

Delegated Schools’ Budgets

36. The statutory deadline for schools to submit their approved budgets was 3 May 2006; by this date 133 (45%) budget submissions from schools had been received out of 293 schools. At the time of writing this report this had increased to 289 (98.6%). A full analysis of school budget submissions will be provided in the next financial monitoring report.

Social & Community Services (£0.266m overspend excluding Supporting People)

	Year End Variation
	£m
Cultural Services & Adult Learning	0.000
Social Care for Adults	0.954
Partnerships & Planning (excl. Supporting People)	0.428
Business Support & Performance Management	0.047
Directorate Management Team (incl. contingency)	-1.163
Social & Community Services Subtotal	0.266
Supporting People	-0.358
Total	-0.092
Memorandum Accounts
Older People, Physical Disabilities & Eqpt Pooled Budget	0.317
Learning Disabilities Pooled Budget	0.000

Cultural Services & Adult Learning (no variation forecast)

37. At this early stage in the financial year no overall variance is forecast for Cultural Services, but this may change as trend data become clearer.
38. The significant financial challenges facing Adult Learning were considered in detail at Cabinet on 21 June. The proposals for 2006/07 result in a deficit of £0.174m being incurred during this financial year. Cabinet agreed to a temporary supplementary estimate of £0.174m, hence this service is now forecasting a breakeven position. The recovery plan consists of a containment of costs in the short term, and a radical service re-design over the next three years. There are inevitably risks associated with delivering a "turn-around" project of this scale and this will require close monitoring.

Social Care for Adults (£0.954m overspend)

39. The budget for Older People is currently forecasting an overspend of £0.619m. Of this the most significant variance arises in internal home support service which is forecasting a year-end overspend of £0.478m, £0.350m relates to the recruitment of care workers to support transfers from acute hospital beds, and £0.128m relates to the recruitment of mainstream care workers for the transitional period of new external contracts. The overspend is expected to be partially offset by an underspend of £0.177m in external home support. A £0.200m pressure relating to achieving Fairer Charging income has been identified and an action plan has been formulated to address this. The care management team budget currently forecasts an overspend of £0.140m. This is within the context of a £0.290m vacancy factor in this area, representing the funding shortfall if all posts were filled.
40. The Physical Disabilities budget is predicted to overspend by £0.273m, £0.260m of which is due to a projected shortfall in Fairer Charging income (see para 39, included in action plan).
41. No significant variances are forecast for the Integrated Mental Health Service (£0.028m overspend) and Learning Disabilities (£0.024m overspend).Partnerships & Planning (£0.428m overspend)
42. The County Council contribution to the Learning Disabilities Pool falls within this area and is showing a forecast overspend of £0.328m, due to underachievement of Fairer Charging and other client income (see para 39 action plan formulated to address this). Other variances relating to legal charges (£0.060m overspend) and internal and external day services (£0.040m) are forecast for year-end.

Business Support & Performance Management (£0.047m overspend)

43. An overspend of £0.047m is forecast relating to pressures within Facilities Management and Finance.

Directorate Management Team, including Contingency (£1.163m underspend)

44. This large underspend primarily relates to the contingency, which has a budget of £1.313m and no spend allocated to it. This was created within the 2006/7 budget to provide a buffer in the event of efficiency savings (totalling more than £9m) proving hard to deliver. The directorate’s senior management team has agreed a process for prioritising bids against this budget. Any proposed virements will be referred to members for formal approval. Although pressures have been identified, and amounts in the contingency ringfenced, it is considered too early in the financial year to request a virement.

	Year End Variation £m
Contingency budget	1.313
Ringfenced to meet current pressures:
Fairer Charging income	0.788
Transitional cost of new home care contracts	0.128
Underachievement of vacancy targets	0.390
Total ringfenced pressures	1.306
Balance of contingency	0.007

45. The Directorate Management Team is currently reporting an overspend of £0.077m, due to additional costs associated with an interim head of service & recruitment costs for the permanent position. In addition there are other forecast overspends totalling £0.066m.

Supporting People (£0.358m underspend)

46. The Joint Commissioning Body recently agreed an in-year planned underspend of £0.385m in order to fund inflationary increases to providers in 2007/08. Current forecast shows £0.027m variance against plan, although this includes an assumption of achieving one-off savings of £0.448m to meet in year pressures and on-going savings of £0.225m to meet shortfalls in grant to meet current obligations.

Pooled Budgets Memorandum Accounts

47. The pooled budget for Older People, Physical Disabilities & Equipment is currently forecasting an overspend of £0.317m, due partly to the Radcliffe Infirmary closures to date plus other aspects of speedier discharge. This overspend is hoped to be pulled back by taking action now and through additional funding from the Primary Care Trusts.
48. The main pressure on the pooled budget for Learning Disabilities relates to £1.2m of efficiency savings to be found. A management plan is in place to monitor these savings and a breakeven position is forecast.

Environment & Economy (no variation forecast)

49. The current forecast position shows a projected breakeven for all service areas.

Transport (no variation forecast)

50. The risks to achieving the current breakeven prediction sit within Highways Management where there may be difficulties in the full achievement of targeted cashable efficiencies. The successful 12 month extension to the current energy contract, will make the cost pressures manageable within this year’s Transport budget. There is still a high risk in future years that costs will increase beyond the provision within the current medium term financial plan.Sustainable Development (no variation forecast)
51. Waste management is the highest risk area. The service area is not only dealing with operational issues, but also working in partnerships with districts (through the Oxfordshire Waste Partnership) and progressing steadily in the procurement process for a waste treatment contract. The break-even position takes into account a proposed transfer of both the £0.253m carry forward from 2005/06 and £0.231m from in-year underspends into the Waste Management earmarked reserve. This earmarked reserve will help to support financially one off and other agreed initiatives to minimise the impact of Landfill Allowance Trading Scheme fines.Business Support (no variation forecast)
52. It is proposed to transfer £0.140m of the Business Support carry forward into a reserve to fund projects to improve the way we work.
    
    Community Safety (£0.050m underspend)
53. The Fire & Rescue Service forecast underspend of £0.050m on the administration budget relates to a 2004/05 Policy & Budget Plan for the appointment of a Radio Replacement Project Manager. This appointment was deferred until 2005/06 and consequently the £0.050m will be carried forward until 2008/09 in order to fund this 4 year commitment.
54. Under the new financial arrangements for firefighter pensions, authorities are required in 2006/07 to make a payment into the firefighter fund of 1 x pensionable pay for ill-health retirements made in 2005/06. In 2005/06 there were two such retirements and as a consequence, the 2006/07 budget will be over-spent by £0.024m. This overspend will be a call on balances.
55. Council approved a one-off budget provision of £0.252m for Community Safety in 2006/07 to help offset the brought forward overspend of £0.308m. This, together with contributions of £0.026m from other underspent areas of the directorate, will mean a net overspend of £0.030m to be recovered in the financial year. An action plan is in place to address the position.

Resources and Chief Executive’s Office (£0.310m overspend)

56. Resources and the Chief Executive’s Office are forecasting a combined overspend of £0.310m for the areas set out below:

	Year End Variation
	£m
Financial Services & Procurement	0.000
Human Resources	0.000
Legal Services	0.000
Information Communications & Technology	0.000
Business Support	0.000
Property Services	0.030
Coroner’s Service	0.000
Shared Services	0.300
Chief Executive’s Office	-0.020
Total Variation	0.310

Human Resources (no variation forecast)

57. Efficiency savings not fully achieved last year together with this year’s savings will be met by the management of vacancies. This may put pressure on the achievement of some of the service objectives.

Information Communications & Technology (no variation forecast)

58. Excluding ringfenced underspends, there is an overspend carried forward of £0.165m to be managed this year. The current forecast shows that achieving this year’s financial target will be tight but can be achieved with careful management of variances and restricting the use of contract staff.
59. One off funding of £0.337m from Local Authority Business Growth Incentive income and £0.375m from the release of part of the Pension Reserve funding has been approved by the Cabinet. This will be used to fund corporate projects with priority being given initially to development work on the universal payments system, document forms and data management.
60. Approval has been given by the Cabinet for £0.221m from the capital programme to fund part of the cost of constructing a data centre at Clarendon House, the balance of £0.300m being met by the revenue budget.Property Services (£0.030m overspend)
61. The Castle Project brought forward an overspend of £0.136m to be met from this year’s budget and external funding. Allowing for residual legal and other costs, an unfunded balance of £0.030m is forecast. There is also a risk that the Oxford Preservation Trust will be unable to meet insurance costs of £0.030m, which would then become a cost to the Council. It is proposed that any overspend on the completion of the project, be met by using part of the £0.150m included in the capital programme for the Castle Education Centre, which is no longer required.

Shared Services (£0.300m overspend)

62. The budget for the SAP Revitalisation Project is now included as part of the Shared Services Project. A review of all the commitments against budget indicates that there may be an overspend of around £0.300m in the current year. This is a cash flow issue and will be managed by a corresponding underspend next year.
    
    

SAP Revitalisation Project Stream	£m
Programme Management	0.417
Finance	0.220
Integration of third party systems	0.500
Procurement	0.920
SAP Competency Centre	0.200
HR	0.040
Total	2.297
Budget	1.997
Forecast overspend	0.300

63. Excluding the SAP Revitalisation Stream, spend on the Shared Services Project this year looks to be significantly less than forecast and this planned spend will move into next year. A detailed updated will be provided in the next Financial Monitoring Report.

Chief Executive’s Office (£0.020m underspend)

64. There is a planned underspend this year in the Scrutiny budget of £0.020m to cover the pay costs of 1.5 FTE research and support assistants for the remainder of their contracts in 2007/08.

65. At the end of 2005/06, the underspend on the Modernisation Fund was transferred into an earmarked reserve in line with the original purpose in setting up the "Fund". It is similarly proposed to transfer the budget allocation for 2006/07 into the reserve and then to draw down the reserve to fund successful bids. The position to date is set out below:

Modernisation Fund Reserve	£m
As at 1 April 2006	0.740
Proposed transfer to reserve	0.489
Successful bids to date:
Business Process re-engineering	-0.110
Foster Care Placements	-0.080
Change Management	-0.040
Preventative & Day Care Services	-0.122
Countywide Facilities Management	-0.024
Total of successful bids	-0.376
Uncommitted balance	0.853

Strategic Measures

66. It is anticipated at this stage of the financial year that there will be a surplus of £0.650m arising on strategic measures in 2006/07.
67. There are two main reasons for this. Firstly, when the budget was constructed it was anticipated that base rates would fall during 2006/07 from 4.5% to 4.0%. The current view is that the next movement in base rate will be upwards, although not for some time. A base rate of 4.5% has been used for this update. Secondly, balances at the start of the financial year have been higher than estimated, principally due to slippage on the Capital Programme during 2005/06.
68. There are potential risks to the delivery of this surplus. The main risk is in relation to the level of the Baxter Index, which is used to calculate interest due on some developer contributions. The current Baxter Index used for this update is 4.9%. As a comparison the Baxter index used in recent years has been 10.0% in 2002/03, 3.7% in 2003/04, 3.6% in 2004/05 and 6.2% in 2005/06.
69. It has also been assumed that returns from our external cash managers will average 4.5% for the year. We are looking for their returns to exceed 4.5% over a three-year period. There will be fluctuations in returns, both up and down, during this period and these will be carefully monitored and reported to Cabinet from time to time.

Government Grants

70. Details of specific grants are shown in Annex 3 and summarised below:

	£m
Specific grants received in 2006/07 (as per published Medium Term Service & Financial Plan)	399.113
New grants/changes previously reported	0.000
New grant changes this month	-0.138
Total grants for 2006/07	398.975

71. The changes this month represent changes in the Sure Start General and Local Programme grants (net reduction of £0.166m), a reduction of £0.025m in the Mental Health Grant (final notification) and a new "New Burdens" grant of £0.053m in Community Safety.

Earmarked Reserves

72. Details of Earmarked Reserves are shown in Annex 4 and summarised below:

	2006/07
	Balance at 1 April 2006	Forecast Movement		Forecast Balance at 31 March 2007
		Contributions from Reserve	Contributions to Reserve
	£m	£m	£m	£m
Children Young People & Families	17.063	0	0	17.063
Social & Community Services	1.550	-1.406	0.180	0.324
Environment & Economy	4.397	-0.070	1.289	5.616
Community Safety	0.923	-1.374	0.782	0.331
Resources & Chief Executive’s Office	1.448	-0.819	0.511	1.140
Corporate*	14.530	-8.250	0.037	6.317
Directorate Total	39.911	-11.919	2.799	30.791

* Note: the Corporate figures do not include any drawdown on the Shared Services Reserve pending confirmation of detailed spending forecasts.

General Revenue Balances

73. The forecast position for general balances has increased by £0.558m as shown below. This is as a result of adjustment to balances following preparation of final accounts of £0.443m (mostly early receipt of Local Authority Business Growth Incentive funding), additional interest on cash balances £0.650m, offset by calls on balances of £0.337m funding to ICT, a temporary supplementary estimate to Adult Learning of £0.174m and fire-fighters ill health retirements of £0.024m.

	£m
Forecast position per last report (net of City Schools)	15.132
Adjustment to balances following preparation of final accounts	0.443
Additional interest on cash balances	0.650
Allocation of Local Authority Business Growth Incentive funding to ICT	-0.337
Temporary supplementary estimate to Adult Learning	-0.174
Fire-fighters ill health retirements	-0.024
Net forecast position (net of City Schools)	15.690

Efficiency Savings

74. At this stage no variations to achieving the targets have been reported. However, a number of risk areas have been identified, particularly within Social & Community Services, and these will be closely monitored.

Best Value Performance Indicator (BVPI) 8

75. BVPI8 measures the percentage of undisputed invoices paid within 30 days of receipt. The Council’s target for 2006/07 is for 95% of invoices to be paid within 30 days of receipt and the performance for the year to the end of May is as follows:

	%
Children, Young People & Families	95.0
Social & Community Services	88.9
Environment & Economy	98.3
Community Safety	94.8
Resources	89.7
Chief Executive’s Office	96.7
Mouchel Parkman	79.1
	91.5

76. April was a very encouraging month but performance has slipped in May. Performance by Mouchel Parkman, in particular, has deteriorated. The reason for this has been identified and can be overcome. In view of the persistent failure to achieve the performance target between the Council and Mouchel Parkman, the provisions in the contract for fee penalties are being applied.

Conclusion

77. At this early stage in the year Directorates have identified a number of potential budget pressures leading to a total forecast overspend of £0.719m (net of the City Schools overspend). The forecast for general balances stands at £15.690m, giving a consolidated balances position of £14.971m. The position will be closely monitored as in the past a number of underspends have emerged during the year; however a number of risk areas were identified in the budget process and these will also need to be kept under review.

PART 2 – CAPITAL

78. An updated Capital Programme is circulated with this report. This programme rolls forward the 2005/06 actuals and updates the capital programme for the period 2006/07 to 2008/09. Individual schemes have been re-phased accordingly.
79. The capital programme shows an overall surplus of £0.918m that can be used in line with the Council’s decision on 20 June 2006 "as a contingency for any future urgent projects which arise up to 2008/09".
80. The capital cash flow shows a surplus of £11.0m in 2006/07 and a £15.4m shortfall in 2007/08. This indicates an overall shortfall in 2007/08 of £4.4m. It is anticipated that this will be resolved by slippage on schemes at the end of that year judging by past experience. The cash flow is also impacted on by the assumed repayment in 2008/09 of £4.224m on the capital costs of setting up Shared Services. The actual profile of the repayment will not be exactly as shown in the capital financing summary. There are contingency plans in place to ensure that there will be sufficient cash to deliver the programme.
81. The programme will be closely monitored taking into account all of these factors.
82. The capital programme includes schemes approved by the Council on 20 June 2006. The additions to the capital programme are as follows:

• Time to Change – Implementation of phase II of the project
• Maltfield House – Refurbishment of children’s home
• Bicester Library – Provide new / enlarged library
• Highways Depot – Relocate fuel storage at Deddington
• Highways Depot – To improve drainage & containment at Deddington
• Highways Depot – To improve drainage at Drayton

83. The detailed costs for Watlington Library are not yet known. The capital programme will include this scheme once details are known.
84. The Yarnton House scheme is no longer required as the accommodation needs will be dealt with as part of the Review of Property Assets and has been removed from the capital programme as approved by the Council on 20 June 2006.
85. The Cabinet on 21 June approved the provision of £0.221m from the Capital Programme contingency referred to above to fund part of the costs of a central data centre for the Council. The data centre scheme is included in the updated capital programme.
86. The capital programme includes an updated position on the HOPs programme. This shows a surplus of £0.552m, which will be a contribution to revenue in 2007/08. This is less than the assumption in the MTFP which assumes £1.6m. However, this had been identified during the budget process as a potential call against the sum available to allocate in that year.
87. There is no monthly monitoring report attached for this month because the capital programme shows the up to date position. This capital programme will form the basis of the next monthly monitoring report due in September 2006.
88. Significant changes since the last capital programme are as follows:

• The capital schemes moved as a result of the realignment of directorates are now shown in either Social & Community Services or Children, Young People & Families directorate as appropriate
• The Cabinet approved the Local Transport Plan 2006 – 2011 (LTP2) at its meeting on 21 February 2006. This capital programme introduces the LTP2 programme and results in format changes where schemes are grouped to reflect the LPT2

89. During the course of the capital closedown a temporary reserve was established to fund the set up costs of £4.224m for the shared services centre. The capital programme assumes that the £4.224m will be repaid in 2008/09.
90. The Oxford Schools Reorganisation repayment to the DfES is shown in the capital programme as £8.812m; we are still awaiting further progress with the DfES and will report the updated position when known RECOMMENDATIONS
91. The Cabinet is RECOMMENDED to:

1. note the report;
2. take a view on the option to be pursued in respect of any overspend on the Dedicated Schools Grant;
3. approve the proposed transfer of £0.484m to the Waste Management earmarked reserve;
4. approve the proposed transfer of £0.489m to the Modernisation Fund reserve;
5. approve the updated Capital Programme.

SUE SCANE
Head of Finance & Procurement

Background Papers: Directorate reports deposited in the Members’ Resource Centre

Contact Officers:
Stephanie Skivington, Strategic Financial Manager (Part 1) Tel: (01865) 815426
Mike Petty, Strategic Financial Manager (Part 2) Tel: (01865) 815622

July 2006

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