Agenda item

To receive a presentation from the Lead Member for Finance and Asset Management – Councillor Ron Furolo. 

39.1           The Mayor invited the Lead Member for Finance and Asset Management to make his presentation.

39.2           The presentation covered the following main points:

·         The Finance and Asset Management Portfolio – covered a wide variety of services: Financial Strategy and Reporting; Investments; Procurement; Council Tax and Business Rates; Housing Benefit and Council Tax Reduction; Land and Property Asset Management; and Facilities Management.

·         Who Provides the Services? – three teams: Finance Team with equivalent of 7.3 full-time staff; Asset Management Team with equivalent of 9.7 full-time staff including the Council’s cleaning staff; Revenues and Benefits Team with equivalent of 21.3 full-time staff. The Operational Teams were supported by Head of Finance and Asset Management and Head of Corporate Services.

·         What is the Core Service – Finance: collection of £5 million of sundry debt each year (includes trade waste, licences and rentals); payments to 4,500 creditors each year; investments of £162 million each year and allocation of £100 million income each year (includes £55 million of Council Tax and £36 million of Business Rates of which the Council retained £3.8 million of Council Tax and £2.2 million of Business Rates); 3,000 payroll payments made each year; production and management of £9 million net budget; and production of an 80 page Statement of Accounts each year. Asset Management: management of property valued at over £64 million (over £40 million was the Council’s commercial portfolio); management of land totalling over 400 acres; management of 14 play areas and 10 car parks; management of tenants with an income of £2.8 million each year; management of the Public Services Centre with an average of 110,000 visitors per year (staff, tenants and visitors); and management of over 400,000 visitors to car parks each year. Revenues: collection of Council Tax from 41,040 dwellings; collection of £58.7 million in Council Tax; and collection of £35 million in Business Rates from 2,923 business premises (known as hereditaments) with a total rateable value of £91.3 million. Benefits: administers housing benefit – caseload of 3,466 and Council Tax reduction – caseload of 4,303; processed claims for Discretionary Housing Payments – 299 awards in 2017/18 totalling £131,752; provision of personal budgeting support and assisted digital support to residents claiming Universal Credit; and investigation of cases of possible fraud and provision of single point of contact for the Department for Work and Pension’s Single Fraud Investigation Service.

·         Achievements – two retail units in Clevedon purchased in 2006 then 10 years later purchased G4S building near Junction 9 of the M5. Building on that success, Lambert Smith Hampton appointed to source and secure further properties for the commercial property portfolio - £39.5 million investment to date in property across the country. £2.37 million gross rent per year with a 6% yield on investment and £1.55 million net benefit to budget currently. Properties were managed in-house with support from Lambert Smith Hampton and rental income was now the third biggest financing stream behind Council Tax and New Homes Bonus. The Public Services Centre had been refurbished with substantial changes made to the working environment and decoration as well as the fabric of the building (including roof, wiring and ventilation). In 2014 the first floor, roof and windows had been refurbished at a cost of £1.6 million and in 2018 the reception area, Growth Hub and Civic Suite had been refurbished at a cost of £2.3 million. The Council now had tenants on the top floor which brought in £120,000 per year, leases had been renegotiated with existing tenants and negotiations were ongoing with the County Council about extending its current lease area. The new leisure centre had been completed in May 2016 – delivered on time and on budget at a cost of £7.5 million and, since then, the centre had received over 250,000 annual visits, over 2,000 members had joined, 1,200 children were on the swimming lesson programme and it had won a ‘very good’ Quest Award (an independent assessment of the standard of the facility and the service offered). As well as the community benefit of the centre, the contract with Places for People provided for a contract sum of £150,000 per year and a profit share at the end of year three which could be reinvested into the centre. Other notable achievements included the replacement of equipment at the Vineyards play area; the opening of the Riverside Walk; the introduction of a cashless system for parking charges; the demolition of the old Cascades building; the  update of the Council’s Tree Policy to manage its 5,500 trees; investment in a new system to plot the trees and record inspections; the roll-out of a system for play area inspections; the successful bid to be in the 100% retained business rates pilot; the installation of a new purchase ordering system and new PayPoint payment channel; introduction of a new process to comply with the Construction Industry Scheme and taxation requirements by performing a number of checks on the individual or company and either putting payments through payroll, where tax was deducted, or paying the consultancy direct; the introduction of a new Fees and Charges Strategy; closure of the accounts one month earlier than previously; annual production of a balanced Medium Term Financial Strategy and budget; support to corporate projects; continued excellent external audit opinion of the Council (including unqualified opinion on accounts, excellent working papers and sound value for money conclusions); introduction of barcodes on Council Tax bills to provide customers more payment options and to support the local economy; identification of additional income from renewable energy sites for business rates (this had previously not been claimed as it had gone under the radar); review of policies and processes in Revenues and Benefits (such as long term empty premium for Council Tax and approval of a Council Tax Reduction Scheme); a service review resulting in £100,000 saving and no detrimental effects to service performance; improvements to the benefit subsidy reclaim of £100,000; close working with the Department for Work and Pensions to ensure smooth roll-out of Universal Credit in the Borough; and maintaining above average benefits performance despite reductions in the staffing establishment. 

·         Targets – Disposal of MAFF site - various potential uses explored over last 17 years but none found to be viable. Would be suitable for high density residential development so could sell to developer. The site has significant capital value and its disposal for residential development was agreed by the Executive Committee in July. The team was currently carrying out surveys on the site and an architect had been engaged to begin the process of an outline planning application. Sale to a residential developer could net the Council a gross capital receipt in the region of £1.5 million, produce around 60 additional housing units, including the appropriate quota of affordable housing, and also enable further gains through New Homes Bonus and Council Tax. Development of Spring Gardens in Tewkesbury town – despite best efforts market conditions, reduced funding and lack of resource had resulted in the project stalling so the Council had appointed development advisor specialists, Mace Ltd, to provide skills and capacity to recommend a way forward and drive the project to completion. Further commercial property investment would be made; there was still £6.6 million available from Council approved funds. The Council was targeting a purchase within the industrial and warehouse sector in order to keep the portfolio balance- it would be avoiding High Street retail. Interest rates remained high but yields had lowered in recent months. Completion of the final purchase would result in a £45 million commercial property portfolio and the Council would then assess its position and consider whether any further activity was appropriate. Other targets included development of long term planned asset maintenance programme; a new investment strategy (to include new government guidelines in terms of disclosure requirements); demolition and re-use of the depot; and more use of technology including procurement system, vehicle charging points and online direct debits.

·         Targets – Revenues – maximise the development of digital delivery (including customer engagement through channels such as webchat) and introduction of paperless billing for Council Tax and Business Rates; improved Council Tax and Business Rates collection rates; maximised returns from New Homes Bonus through focused inspection regimes and development of relations with the Valuation Office Agency; and support to the successful delivery of the Growth Hub.

·         Targets – Benefits – maintaining a comprehensive housing benefit and Council Tax reduction service to support those residents of Tewkesbury Borough on a low income; continuing to take a key role in the Financial Inclusion Partnership sharing Council and welfare reform developments with partners in the Borough; and continue to deliver personal budgeting support and assisted digital support to residents affected by Universal Credit.

39.3           The Mayor thanked the Lead Member for his informative presentation and invited Member questions. One Member questioned how the Council paid its invoices and the timescales for payment. In response, the Head of Finance and Asset Management advised that, around 94% of payments were made within the 30 day limit (many within four or five days) and the majority were paid electronically. In terms of the claims against renewable energy sites, and whether this could be done retrospectively, the Head of Finance and Asset Management confirmed that the total amount due had been reclaimed and all sites within the Borough had been considered. Another Member referred to the fact that the Council maximised returns from New Homes Bonus through focussed inspections and improving the relationship with the National Valuation Office and he questioned how this was achieved. In response, he was advised that the Council told the Valuation Office about new properties being built and then the Valuation Office banded them for billing; the Council had to make a return which determined the level of New Homes Bonus gained so it needed a sharp inspection process in place to ensure the returns were maximised as quickly as possible.

39.4           Accordingly, it was

                  RESOLVED          That the presentation provided by the Lead Member for                                      Finance and Asset Management be NOTED.