Agenda and minutes

Apologies were received from Cllr S Butikofer, Cllr N Housden and Cllr V Holliday.

Cllr J Toye.

To receive questions / statements from the public, if any.

None received.

To approve as a correct record the minutes of the meeting of the Overview and Scrutiny Committee held on 14^th December 2022.

Minutes of the meeting held on 14^th December 2022 were approved as a correct record and signed by the Chairman.

To determine any other items of business which the Chairman decides should be considered as a matter of urgency pursuant to Section 100B(4)(b) of the Local Government Act 1972.

None received.

Members are asked at this stage to declare any interests that they may have in any of the following items on the agenda. The Code of Conduct for Members requires that declarations include the nature of the interest and whether it is a disclosable pecuniary interest.

None declared.

To consider any petitions received from members of the public.

None received.

To consider any requests made by non-executive Members of the Council, and notified to the Monitoring Officer with seven clear working days’ notice, to include an item on the agenda of the Overview and Scrutiny Committee.

None received.

To consider any responses of the Council or the Cabinet to the Committee’s reports or recommendations:

None to report.

LIST OF BACKGROUND PAPERS AS REQUIRED BY LAW

(Papers relied on to write the report, which do not contain exempt information and which are not published elsewhere)

Cllr E Seward – Portfolio Holder for Finance and Assets introduced the report and informed Members that it had been deferred at Full Council in December to account for further budget considerations. This had had resulted in one substantial change which related to an increase in garden bin charges to £56 from £52.50.

Questions and Discussion

       i.          Cllr P Heinrich referred to filming costs and asked whether this included professional photography for advertising and similar purposes, or whether this was treated separately. The CE replied that all filming was reviewed to consider whether it was commercial in nature, and this would be used to determine whether a charge was appropriate, against the potential positive impact the exposure could bring.

      ii.          Cllr S Penfold asked who the copyright would belong to once filming had completed and whether the Council would be able to use any material for promotional purposes. The CE replied that once consent had been granted, the copyright would belong to the individual or company filming, and the Council would not be permitted to use the footage without permission.

     iii.          Cllr J Toye referred to increased fees of five or nine percent which had both been stated in the report, and sought clarification on which was correct. The DFR replied that the original intention had been a five percent increase, and whilst this had been reconsidered, most fees would remain at that level, with some limited exceptions seeing a twenty percent increase.

    iv.          The recommendations were proposed by Cllr J Toye and seconded by Cllr P Heinrich.

RESOLVED

To recommend to Full Council:

a)     The fees and charges from 1 April 2023 as included in Appendix A.

b)     That Delegated Authority be given to the Section 151 Officer, in consultation with the Portfolio Holder for Finance and relevant Heads of Service, to agree those fees and charges not included within Appendix A as required, as outlined within the report.

LIST OF BACKGROUND PAPERS AS REQUIRED BY LAW

(Papers relied on to write the report, which do not contain exempt information and which are not published elsewhere)

Cllr E Seward – Portfolio Holder for Finance and Assets introduced the report and informed Members that despite knowing the operational costs for 2023-24 in early December, full details of the Council’s income had not been known as the Local Government Financial settlement had not been received until the 19^th. He added that there had also been challenge about the level of retained business rates the Council would receive, which made it difficult to predict the Council’s operating income. It was noted that the wider context of the financial situation was the result of external factors, which had been unforeseen in the previous year. Cllr E Seward noted that the previous S151 Officer had noted that predictions suggested continued funding at the same level would have equated to a £100k deficit, though this was based on a range of assumptions subject to change, as had come to be the case. He added that now the Council better understood its financial situation, it would respond to the challenges accordingly, predominantly related to inflationary costs of approximately 14%, equivalent to £2.932m. It was noted in terms of funding, that a new 3% Guarantee Grant established that would provide over £1m, and was very welcome. Cllr E Seward stated that the Council had also lost funding streams such as the Lower Tier Service Grant worth £147k, as well as losing most of the new homes bonus which had reduced to £31k from £886k. He added that these funding losses had not been fully anticipated, and the Council had therefore only seen a net funding increase of £137k. It was noted that of the retained business rates outlined at £7.2m the Council were only entitled to £6.3m, which meant the Council would have to take £900k from the business rates reserve. Cllr E Seward stated that the lower entitlement was the result of various Covid grants and payments received, with further savings of £1.2m required, following an initial sift of £396k, which totalled the £1.6m required to produce a balanced budget. He added that no change in the funding formula had been proposed for 24-25, but the business rates received could fluctuate in the years ahead.

Questions and Discussion

       i.          The Chairman noted that Cllr E Seward had commented on both the MTFS and Budget reports, though in most cases the comments applied to both. He added that in previous years concerns had been noted regarding the economic forecasts, and these challenges were now being seen.

      ii.          Cllr C Cushing referred to p57 and noted that pay inflation was reported at two percent, whilst other inflation was reported to be a three percent, and sought clarification, given that they appeared to be much higher. Cllr E Seward replied that it was his understanding that pay inflation was five percent, but was expected to return to two percent. The DFR stated that whilst there had been a larger than expected increase in 2022, it was forecast to reduce in the years ahead, and  ...  view the full minutes text for item 117.

LIST OF BACKGROUND PAPERS AS REQUIRED BY LAW

(Papers relied on to write the report, which do not contain exempt information and which are not published elsewhere)

Cllr E Seward – Portfolio Holder for Finance and Assets introduced the report and stated that at present, there were no significant changes expected between pre-scrutiny consideration and Council, though there was scope for changes should any of the funding arrangements or business rates retention change. The DFR stated that if required, any changes would be incorporated into the Cabinet report, but this would be dependent on receiving confirmation of the Local Government Financial Settlement.

Questions and Discussion

       i.          The Chairman asked which aspects of the budget presented the most risk or the greatest concern, to which Cllr E Seward replied that staff cost inflation had presented the most significant concern, though the rising costs of capital projects was also a major issue with costs doubling in some cases. He added that further concerns included some tenders only bringing one or two bids, which further increased costs through a lack of competition, therefore it was hoped that costs may begin to stabilise, or the Council would struggle to meet them.

      ii.          Cllr J Toye referred to the tax base identified and asked whether it was possible to determine how this had changed as a result of holiday homes being registered for business rates and subsequently being granted business rates relief. The DFR replied that she could review the tax base over the previous five years and share the information with Members. Cllr A Brown expected that some research on the potential reduction of the tax base may have been undertaken as part of the review on the impact of second homes and holiday lets. Cllr E Seward confirmed that the information was held by the Revenues Manager. Cllr L Withington suggested that it may be helpful to consider the impact of a reduction in new homes, as a result of nutrient neutrality legislation.

     iii.          Cllr C Cushing referred to proposed savings and income generation in Appendix A, and asked whether an amended table could be shared with Members that would differentiate between the two. He added that it would be helpful to have an indication of confidence for each proposal, to determine how likely they were to be achieved. The DFR replied that subject to Members’ approval, the savings had already been included as part of the budget-setting  process, so she had full confidence that they would be achieved, and she could seek to provide confidence indicators on the income generation proposals. The Chairman referred to the proposals and suggested that it would be helpful to include separate totals for the revised savings and income generation. Cllr E Seward confirmed that the total figure was combined savings and income, but he would be happy to separate the two. The DFR referred to the original savings figure and noted that these had already been taken out of the budget, and whilst the more recent savings figures and income generation proposals had been included, they were still subject to approval by Members. She added that the balanced budget was reliant on realising  ...  view the full minutes text for item 118.

LIST OF BACKGROUND PAPERS AS REQUIRED BY LAW

(Papers relied on to write the report, which do not contain exempt information and which are not published elsewhere)

Cllr E Seward – Portfolio Holder for Finance and Assets introduced the report and informed Members that it was a statutory requirement as part of the budget-setting process. He added that the Council had not used any long-term borrowing to fund its capital programme, and had received advice that higher rates of interest meant that the Council should continue to avoid any long-term borrowing, unless absolutely necessary.

Questions and Discussion

The Chairman noted the importance of continued funding of the Council’s capital projects without reliance on long-term borrowing, as outlined in the report.

The recommendation was proposed by Cllr H Blathwayt and seconded by Cllr J Toye.

RESOLVED

1.     To recommend to Full Council that the Capital Strategy and Prudential Indicators for 2023-24 are approved.

Contact Officer, telephone number and email: Tina Stankley, tina.stankley@north-norfolk.gov.uk

Cllr E Seward – Portfolio Holder for Finance and Assets introduced the report and reiterated that as with other financial strategies, it was required as part of the budget-setting process.

Questions and Discussion

The recommendation was proposed by Cllr S Penfold and seconded by Cllr L Withington.

RESOLVED

1.     To recommend to Full Council that the Investment Strategy is approved.

Contact Officer, telephone number and email: Tina Stankley, Tina.Stankley@north-norfolk.gov.uk

Cllr E Seward – Portfolio Holder for Finance and Assets introduced the report and noted that the borrowing strategy included a change in emphasis, with short-term borrowing previously used to maintain cashflow whilst interest rates stood at approximately 0.5%. However, it was reported that these rates had now risen considerably, which meant that borrowing costs outweighed investment income, therefore low-yield investments would be sold to ensure that adequate cashflow could be maintained. It was noted that long-term investment income was still expected to rise as a result of increases in the base rate.

Questions and Discussion

The recommendation was proposed by Cllr S Penfold and seconded by Cllr P Fisher.

RESOLVED

1.     To recommend to Full Council that The Treasury Management Strategy is approved.

LIST OF BACKGROUND PAPERS AS REQUIRED BY LAW

(Papers relied on to write the report, which do not contain exempt information, and which are not published elsewhere)

Cllr V Gay – Portfolio Holder for Leisure, Wellbeing and Culture introduced the report and informed Members that it was an exercise in reflective practice, with lessons learned included for consideration. She added that the report sought to address how the project had dealt with the constraints that all projects shared, which included time, funding and purpose. It was noted that construction was originally planned to finish in November 2021, and this deadline had been met despite delays caused by Covid-19. In terms of budget, it was reported that there had been some slippage, but this had been reported to the Committee from January 2021 onwards, and the project had still been completed without the need for any long-term borrowing. In regards to purpose, it was noted that membership had tripled since the closure of Splash, and was far higher than expected in the original feasibility study. Cllr V Gay stated that the Reef had been made as accessible as possible with changing places facilities, and the number of schools using the facility had risen from two to nine. She added that the table of lessons learned was very insightful, and could apply to all projects undertaken by the Council.

Questions and Discussion

       i.          The Chairman noted that it was commendable that the project had progressed throughout multiple administrations, spanning approximately eight years from the planning stage. He added that when the report was requested it had been suggested it would cover all aspects from planning to completion, but future reports could be requested on matters such as usage and energy efficiency. Cllr N Dixon noted that he did not feel the budget slippage was significant, given the overall cost of the project, and expected many other authorities would have struggled to achieve the same. It was noted that the Committee’s recommendation to bring forward demolition of the old facility forward had been accepted and was a positive contribution to the phasing of the project, which had helped to address the delays caused by Covid-19, and shown that the Committee could work well overseeing major projects.

      ii.          Cllr C Cushing referred to the project recommendations outlined in the report and proposed a recommendation that these should be considered in further detail by GRAC.

     iii.          Cllr S Penfold agreed with comments that £100k slippage on a project of this size was minimal, and a superb facility had been delivered that was evident from membership levels. He referred to the lessons learned appendix which suggested that the final build stages of the project were rushed, and noted that the architect would usually be expected to sign-off building work rather than the contractor. He asked whether it would have been worthwhile seeking external evaluation, and whether this would have helped. Cllr V Gay replied that it was her understanding that there had been an external review of the building works prior to sign-off, but there had been comments made during the interview process that some aspects had been rushed towards the end of  ...  view the full minutes text for item 122.

To note the upcoming Cabinet Work Programme.

The DSGOS noted that the Committee had taken six financial reports for pre-scrutiny which would form the majority of reports for February Cabinet and Full Council meetings. He added that there was a Solar Car Port report expected in March that may interest the Committee due to its relevance to the Reef project and its future energy efficiency. It was noted that there was confirmation on the Cabinet Work Programme that the Economic Growth Strategy was no longer expected, but it was unknown whether the proposed action plan would be seen in advance of the election. Cllr T Adams stated that he would seek to confirm whether an economic action plan would be prepared.

RESOLVED

To note the Cabinet work programme.

To receive an update from the Scrutiny Officer on progress made with topics on its agreed work programme, training updates and to receive any further information which Members may have requested at a previous meeting.

The DSGOS informed Members that Serco were due to attend in February to provide an update on bin collections, alongside the quarterly NWHSHAZ report that would include requested information on the £400k funding uplift. He added that an action plan of the PSIP was expected, whilst for ambulance response times, service pressures meant that it would not be appropriate to call in representatives, though performance data would still be sought for consideration. Finally, delegated decisions and the request for benchmarking of filming and garden bin charges had been requested and were expected in February, whilst the PCC had confirmed his availability for March. It was noted that due to the May elections, there was no meeting scheduled for April.

RESOLVED

To note the work programme.

To pass the following resolution, if necessary:

“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 involve the likely disclosure of exempt information as defined in paragraph _ of Part I of Schedule 12A (as amended) to the Act.”