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Apologies for absence were received from Councillors Hunt and D. Knight.
Councillor Jones also advised that he would not be present for the second part of the Committee as he was attending a Parish Council meeting.
RESOLVED, that the minutes of the meeting held on 9th February 2023 (circulated previously) be approved as a correct record and signed by the Chair.
Order of Agenda
The Chair announced that a request had been made to her that the Committee considered item 9: Work programme 2022/23 as the first item on the agenda.
RESOLVED that item 9: Work programme 2022/23 be considered as the first item on the agenda.
Declarations of Interest.
(Please telephone the Corporate and Community Services team to prepare a form for your signature before the meeting. Interests must be re-declared when the item is called, and Councillors must leave the room if necessary).
There were no declarations of interest announced
a) To consider the work programme (attached); and
b) Consider the topics discussed at the informal meeting of the Committee on 15th June 2023 and to agree which year each topic will be considered in and appoint a Member to lead on each one as part of a scoping exercise (template attached).
The Vice Chair introduced the item and outlined discussions that had been held at the informal meeting, which was held on 15th June 2023.
He advised that the Members present at that meeting had discussed the two main roles of the Committee, which were focussed on supporting and delivering the financial regulatory functions of the Council together with the external business affairs and their impact upon the Council and its citizens.
From this informal discussion, the Members had developed a list of 10 areas that they would like to focus on, which would equate to a workload of three years for the Committee.
He added that as a starting point, the Members present had informally agreed to explore three areas on the list, which were:
· Water quality.
· Future of agriculture in North Devon.
There was some discussion between the Committee Members who were present at the informal meeting as to whether or not those areas were agreed as the first three to be considered and the Members also discussed other areas of interest to them.
The Director of Resources and Deputy Chief Executive advised that the Chief Executive had circulated information via email regarding the various areas of work that the Council were already involved in at a local level. He added that there was a lot of work ongoing behind the scenes, which related to empty homes.
In response to point’s raised by the Committee, the Vice Chair read out the list that had been compiled and signed up to by the Members that were present at the informal meeting of the Committee, which were:
1. Recycling: Councillor Clayton.
2. Dentistry: Councillors Bushell, Hunt and Patrinos.
3. NDC revenue: Councillor Jones.
4. Water quality: Councillors Patrinos, Jones, Bishop, Wilson and Spear.
5. Agriculture: Councillors Bulled, Jones, Bushell and Patrinos.
6. Inward investment: Councillors Bushell and Jones.
7. Renewables: Councillor Wilson.
8. Empty Homes and Housing: Councillors Wilson, Bishop, Bulled and Clayton.
9. Public transport: Councillor Bishop.
10.Health inequalities in Ilfracombe: Councillors Wilson, Patrinos and Spear.
The Committee agreed that there should be a maximum of four to five Members in each group together with an appointed leader for each group.
The Chair added that she would like to sit on the group for dentistry.
The Committee agreed the following Members be appointed as group leaders:
Dentistry – Councillor Patrinos.
Water quality – Councillor Jones.
Agriculture – Councillors Bulled and Bushell.
The Vice Chair added that the next steps for the groups allocated to the three topics was to develop a scoping paper to ascertain the purpose of the work together with expectations and potential outcomes.
In response to a question, the Director of Resources and Deputy Chief Executive advised that non-Committee members could assist the groups as a consultee in an advisory capacity.
(i) That the work programme and its standing financial reports to the Committee for 2023/24 be noted;
(ii) That the topics of dentistry, water quality and agriculture be scoped by the appointed ... view the full minutes text for item 5.
Report by the Director of Resources and Deputy Chief Executive to Strategy and Resources on 3rd July 2023 (attached), and
(a) Minute Extract of Strategy and Resources on 3rd July 2023 (to follow).
The Committee considered a report by the Director of Resources and Deputy Chief Executive (circulated previously) regarding the Performance and Financial Management for Quarter 4 of 2022/23 together with Minute Extract of Strategy and Resources on 3rd July 2023 (circulated previously).
The Finance Manager highlighted the following:
· The revenue budget for 2022/23 was approved at Council on 23rd February 2022 at £13,721,640.
· As at 31st March 2023, it was pleasing to report that the final out turn position was a budget surplus of £693,000, which was an overall movement of £674,000 from the last forecast at Q3. The breakdown showing these movements are shown Appendix A – “Variations in the Revenue Budget”.
· The movement from Quarter 3 of £674,000 can be mainly attributed to adverse and favourable variances as outlined in paragraph 4.1.4 of the report.
· The cost of living pressures with double digit inflation continuing for the whole of 2022/23, peaking at 14.2% in Oct 2022 and still near that peak at the end of the March 2023 at 13.5%, resulted in the Council utilising fully the £936,000 budget management reserve in 2022/23. Due to the favourable variances and a transfer in year from the Collection fund reserve the Council has replenished this reserve to a balance of £815,000 to provide the resilience to similar inflationary pressures during 2023/24.
· Members approved in June 2021 to proceed with the acquisition of Green Lanes Shopping Centre; which the Council completed the purchase in November 2021. The purchase of Green Lanes Shopping Centre was a once in a lifetime opportunity to acquire this strategic asset and complement other significant regeneration improvements being delivered within the Barnstaple town centre through the Future High Streets project. The financial modelling demonstrated that revenue income generated from the centre would cover both the repayment of the loan and asset management costs and would return a contribution to the Council which could be used towards mitigating future risks on income volatility, investment back into the centre and the overarching council budget.
· From the revenue budget surplus of £693,000, it was proposed to set aside the amount into the following earmarked reserves:
Ø Office Technology £120,000 – to fund capital business case.
Ø Repairs Fund £214,000 – to fund capital business cases.
Ø Budget Management £279,000 – mitigate 2023/24 inflationary pressures
Ø Insurance Reserve £80,000 – mitigate 2023/24 higher insurance costs.
· At the 31st March 2023 total external borrowing was £3,000,000. The timing of any future borrowing was dependent on how the authority managed its treasury activity and due to previously unprecedented low interest rates and reduced returns on investments it was prudent for the Council to ‘internally borrow’ and use these monies to fund the Capital Programme. This had resulted in a £275,000 reduction in loan interest payments and an increase in interest receivable of £266,000 in 2022/23. £275,000 had been placed into a new Treasury Management reserve to mitigate against higher interest rates as the Council moved into the 2023/24 financial year.
· Appendix B detailed ... view the full minutes text for item 6.
Report by Director of Resources and Deputy Chief Executive to the Strategy and Resources Committee on 3rd July 2023 (attached), and
(a) Minute Extract of Strategy and Resources Committee on 3rd July 2023 (to follow).
The Committee considered a report by the Director of Resources and Deputy Chief Executive (circulated previously) regarding the Annual Treasury Management report 2022/23 together with Minute Extract of Strategy and Resources on 3rd July 2023 (circulated previously).
The Head of Governance highlighted the following:
· This report outlined the actual prudential and treasury indicators for 2022/23.
· The Council’s Capital Financial Requirement (CFR) for the year was detailed in the table on page 83 of the report and was circa £24m which included the finance leasing of vehicles.
· A large capital programme during 2021/22 including the new Leisure Centre and purchase of Green Lanes Shopping Centre resulted in an increased CFR of circa £17m for that financial year. For 2022/23 a further £2.2m was added to our CFR which included the completion of the Leisure Centre build.
· In relation to borrowing outturn, the 2022/23 original budget prudently assumed a level of new external borrowing would be required to fund approved capital expenditure. As a result of lower spend and less external borrowing taken on, interest paid was much lower at £60,363 for the year, with the remaining budget of £275,000 now placed into a new Treasury Management reserve to help mitigate against higher borrowing costs as we move into the 2023/24 financial year.
· The average borrowing rate for year on borrowing loans was 2.01%.
· In terms of investments the increase in bank rate had assisted to improve investment returns for the year with total interest of £290,000 received compared to the original budget £35,000.
· The average rate of return on investment was 1.5% compared to the bench mark of 2.2% which closely tracked to the bank rate.
In response to questions, the Director of Resources and Deputy Chief Executive and the Head of Governance advised the following:
· The interest rates were benchmarked at a rate of 2.2% as the interest rates for the first half of the last financial year were low. The Council held some funds for liquidity purposes but these attracted a lower interest rate.
· The mid-year treasury report would be the best time to review the treasury strategy for the current year in terms of investment options.
· Current investments had been placed at a rate above 5% but this report only went up as far as 31st March 2023. The level of debt against the Councils assets was quite low for internal borrowing.
· The Council had fixed assets of £128m and that was a positive asset base for the size of the authority.
RESOLVED, that the decisions and recommendations of the Strategy and Resources Committee be endorsed.
Timings of future meetings of the Committee for 2023/24.
To agree the timings of future meetings of the Committee for 2023/24.
The Committee discussed the times that were currently scheduled for the meetings for the year 2023/24, which were currently alternating between daytime and evening meetings.
The Chair proposed that the meetings be moved to evenings at 6:30pm.
The Vice Chair added that there might be occasions when a meeting will need to be held in the day to accommodate the attendance of an external organisation.
In response to a question regarding changing the day of the week that the meeting was held on. The Director of Resources and Deputy Chief Executive advised that Group Leaders had discussed the proposals with their Members and their preference was to hold meetings in the evenings on a Thursday. The dates of these meetings also needed to co-ordinate to follow the Strategy and Resources Committee and prior to the next Full Council meeting.
The Chair added that it would be beneficial to have feedback from non-attending Members who had not tendered their apologies as to the reasons why they had not attended the meeting.
RESOLVED, that all future meetings be held at 6:30pm.
There was one vote made against the recommendation.