Agenda and minutes

There were no apologies.

There were no declarations.

The minutes of the meeting held on 11 October 2021 were confirmed as a correct record and signed by the Chair.

There were no public questions.

The Executive Councillor for External Partnerships updated the Scrutiny Committee on the issues considered at the last three meetings of the Combined Authority (27 October, 24 November and 26 January).  It was noted that the Chief Executive at the CA was looking to re-structure and the Mayor has put forward a Sustainable Growth Strategy.  Members asked questions concerning a bus strategy and the continuing e-scooter trial.

 

The update was noted.

Matter for decision

 

The current Security contracts for static and mobile guarding of City Centre locations, assets and events expires on 31 March 2023.

 

In order to continue benefitting from the services supplied to a number of different Council departments there is a requirement for a procurement exercise to be undertaken and to allow award for security services to continue to be delivered.

 

A new tender is proposed, designed as a framework, which allows the flexibility for other Cambridge City Council departments and external partners to join during the term of the contract

 

 

Decision of the Executive Councillor for Finance and Resources

 

To approve the procurement for the corporate security contracts

 

To delegate authority to the Strategic Director to award compliant corporate security contract

 

The new Corporate security contracts will have a term of 4 years with option to extend in annual increments for a further 3 years making the total contract term 7 years. Contract value, up to £4,000,000

 

Subject to: If the tender sum exceeds the estimated contract value by more than 10% then permission to proceed will be sought from the Strategy & Resources Scrutiny Committee.

 

Reason for the decision

As set out in the officer’s report.

 

Any alternative options considered and rejected

Not applicable

 

Scrutiny considerations

 

In response to a question on the types of work and services this procurement covers, the officer confirmed that the Council’s corporate equalities requirements and expectations would be part of the procurement exercise (and contract).

 

The scrutiny committee supported the recommendations.

 

The Executive Councillor approved the recommendations.

 

Conflicts of interest declared by the Executive Councillor (and any dispensation granted)

No conflicts of interest were declared by the Executive Councillor.

Matter for decision

 

This report presents the capital strategy of the council together with a summary capital programme for the General Fund (GF) and Housing Revenue Account (HRA). The previous capital strategy was approved by Council on 25 February 2021. The strategy is focused on providing a framework for delivery of capital expenditure plans over a 10-30 year period. These plans cover spending on operational assets to support service delivery and on investments which provide an income for the council alongside meeting the council’s objectives in relation to economic development and place-making, regeneration and climate change mitigation. Governance arrangements are also outlined in order to ensure the capital programme continues to deliver value for money.

 

The council has a substantial capital programme which is mainly guided by and supports the strategic aims of the council as outlined in the One Cambridge – Fair for All vision and defined in the Annual Statement as published on the council website.

 

The strategy has been updated to reflect:

 

·      Changes to the CIPFA Prudential Code (throughout, but particularly the definitions set out in paras 3.2 and 3.7 and the prudential indicators referred to in paras 5.14, 5.15 and 6.2)

·      The Our Cambridge programme (paras 4.3 and 4.13)

·      the ongoing development of a programme to build 1,000 new council homes in the 10 years from 2022 (para 4.12) and the study to improve the energy performance of council homes (para 4.15)

 

The council’s Section 151 officer is required to report explicitly on the affordability and risk associated with the capital strategy.

 

As highlighted in the strategy the council ensures that capital projects and schemes are accompanied by detailed funding proposals. Where projects are to be funded from borrowing, either internally from cash balances or externally, a prudent Minimum Revenue Provision charge is made. The council has not borrowed externally to fund capital expenditure in the recent past, the current external borrowing representing debt incurred on the transition from the old housing subsidy system to HRA self-financing.

 

Where the council has expanded its commercial activities by purchasing additional commercial properties or by making loans to subsidiaries and joint ventures to facilitate the provision of intermediate housing or the development of sites for market and affordable housing, it ensures that the risks taken are proportionate to the size and scale of the authority. Legal advice is taken alongside the completion of appropriate due diligence and any loans are secured where appropriate. On projects undertaken by joint ventures the council monitors the expected repayment of loans and expected future surpluses carefully. The council has not borrowed externally to fund the increase in commercial activity.

 

External debt will be used to fund the redevelopment of the Park Street multi-storey car park and future housing developments within the HRA. The council is aware of the risks associated with borrowing for these purposes and will seek appropriate external advice.

 

External borrowing may also be used to fund the remainder of the capital programme where capital receipts and cash balances are insufficient. The level of capital spending will be reviewed annually for affordability in the Medium Term Finance Strategy (MTFS), before proposals are brought forward through the budget setting process.

 

Decision of the Executive Councillor for Finance and Resources

 

Agreed to recommend to Council the capital strategy as set out in the report and to note the summary capital programme

 

 

Reason for the decision

 

As detailed in the officer report.

 

Any alternative options considered and rejected

 

None.

 

Scrutiny considerations

 

The scrutiny committee noted that there will be a further review of the capital plan this year.

 

The scrutiny committee supported the recommendations.

 

The Executive Councillor approved the recommendations.

 

Conflicts of interest declared by the Executive Councillor (and any dispensation granted)

 

No conflicts of interest were declared by the Executive Councillor.

 

The appendix to the report contains exempt information during which the public is likely to be excluded from the meeting subject to determination by the Scrutiny Committee following consideration of a public interest test.  This exclusion would be made under paragraph 3 of Part 1 of Schedule 12A of the Local Government Act 1972.

 

Matter for decision

 

To consider the annual update on the council’s intermediate housing company, Cambridge City Housing Company Limited (CCHC) and updated business plan for CCHC for the period 2021/22 – 2030/31.

CCHC performed well over the past year in terms of letting with low void levels, minimal arrears, and low levels of antisocial behaviour. The Annual General Meeting will be held on 16 March 2022.

Since Covid-19, CCHC leased 5 properties from the council to re-let to rough sleepers to help meet their needs, providing accommodation to help keep them safe and provide support. Having operated this model for just over 12 months, it is evident that the shared accommodation model is not suitable for a number of the residents who have been placed in these units. The company is seeking to bring the existing tenancies to an end through the court process and will enter into discussions with the council about the future use of the homes. At the request of the council, one of these leases for a vacant dwelling has been collapsed prematurely to meet a greater housing need.

 

Financially in 2020/21, CCHC generated a small surplus in direct trading activity of £86,824 (2019/20, £73,882) with a decrease in the value of the investment property by approximately £30,000 or 0.4%, to just under £7.9m.

 

Decision of the Leader/Executive Councillor for Strategy

 

Noted the comments of the Strategy and Resources Scrutiny Committee on the draft business plan; and

To inform the Board of Directors of Cambridge City Housing Company of the comments of the Strategy and Resources Scrutiny Committee/Council for consideration in finalising the business plan

As the company’s sole shareholder, confirmed continuing support for the company and recommend refinancing of the company for a further five years at 2.02% p.a., subject to review on the occurrence of any of the conditions set out in paragraph 4.9 of the accompanied report.

Reason for the decision

 

As detailed in the officer report.

 

Any alternative options considered and rejected

 

None.

 

Scrutiny considerations

 

 

The committee noted that the company was currently investigating a further 250 properties but it was dependent on a number of factors.  If wishing to proceed a further report would be expected to come to Members in July.

 

The scrutiny committee supported the recommendations.

 

The Executive Councillor approved the recommendations.

 

Conflicts of interest declared by the Executive Councillor (and any dispensation granted)

 

No conflicts of interest were declared by the Executive Councillor.

 

Matter for decision

 

The council’s Corporate Plan sets out the key priority themes and strategic objectives that the council is working to achieve.  The new Corporate Plan contains four priority themes and covers the five years 2022-27.

 

Detailed objectives and activities are set out in service Operational Plans and team and personal objectives, as well as in council strategies and policies.

 

Decision of the Leader/Executive Councillor for Strategy

 

To recommend the Corporate Plan to Council for adoption.

 

Reason for the decision

 

As detailed in the officer report.

 

Any alternative options considered and rejected

 

None.

 

Scrutiny considerations

 

In response to a question, the Executive Councillor for Finance and Resources undertook to discuss with the Head of Corporate Strategy and Cllr Dalzell how KPIs will be developed to cover the Transformation Programme.

 

The scrutiny committee supported the recommendations 4-0.

 

The Executive Councillor approved the recommendations.

 

Conflicts of interest declared by the Executive Councillor (and any dispensation granted)

 

No conflicts of interest were declared by the Executive Councillor.

 

 

Matter for decision

 

The Council is required to receive and approve, as a minimum, three main treasury management reports each year.

 

The first and most important is the Treasury Management Strategy (this report), which covers:

 

·      capital plans (including prudential indicators);

·      a Minimum Revenue Provision policy which explains how unfinanced capital expenditure will be charged to revenue over time;

·      the Treasury Management Strategy (how investments and borrowings are to be organised) including treasury indicators; and

·      a Treasury Management Investment Strategy (the parameters on how investments are to be managed).

 

The statutory framework for the prudential system under which local government operates is set out in the Local Government Act 2003 and Capital Financing and Accounting Statutory Instruments. The framework incorporates four statutory codes. These are:

 

·      the Prudential Code (2021 edition) prepared by CIPFA;

·      the Treasury Management Code (2021 edition) prepared by CIPFA;

·      the Statutory Guidance on Local Government Investments prepared by the Department for Levelling Up, Housing and Communities (DLUHC) (effective 1 April 2018); and

·      the Statutory Guidance on Minimum Revenue Provision prepared by DLUHC (effective 1 April 2019).

 

 

The Council’s S151 Officer has considered the deliverability, affordability and risk associated with the Council’s capital expenditure plans and treasury management activities.  The plans are affordable. Where there are risks such as the slippage of capital expenditure, or reductions in investment values or income, these have been reviewed and mitigated at an acceptable level. The Council has access to specialist advice where appropriate.

 

Decision of the Executive Councillor for Finance and Resources

 

Recommend to Council to: Approve the report, including the estimated Prudential and Treasury Indicators for 2022/23 to 2025/26 (inclusive) as set out in Appendix C.

 

Approve the renewal of the £7.5 million loan to Cambridge City Housing Company Ltd (CCHC) for a further term of 5 years from 1 April 2022, at an interest rate of 2.02% per annum.

 

Introduce an authorised limit for other long-term liabilities of £2 million, in response to technical accounting changes brought about by the adoption of IFRS 16 (see 7.3 of the report).

 

Reason for the decision

 

As detailed in the officer report.

 

Any alternative options considered and rejected

 

None.

 

Scrutiny considerations

 

Regarding the third recommendation in the report, the Head of Finance advised the committee that the Chartered Institute of Public Finance and Accountancy had delayed the introduction of IFRS 16 but it was still prudent for the Council to increase the limit for long term liabilities now.

 

In response to a question, the Head of Finance updated the committee that work was being undertaken with the Council’s treasury advisors so the Council could more closely monitor the ESG credentials of its investments and this will be included in future reports.

 

The scrutiny committee supported the recommendations.

 

The Executive Councillor approved the recommendations.

 

Conflicts of interest declared by the Executive Councillor (and any dispensation granted)

 

No conflicts of interest were declared by the Executive Councillor.

 

Matter for decision

 

The Budget Setting Report and the Executive Amendment (the latter published on 1 February) reflected what would be proposed to the Executive and if approved to Council.

 

Decision of the Executive Councillor for Finance and Resources

 

To recommend the Executive to:

General Fund Revenue Budgets: [Section 5, page 26 refers]

Agree any recommendations for submission to the Executive in respect of:

• Revenue Pressures and Bids shown in Appendix B(b) and Savings shown in Appendix B(c).

• Non-Cash Limit items as shown in Appendix B(d).

• Bids to be funded from External Funding sources as shown in Appendix B(e).

 

Capital: [Section 6, page 29 refers]

 

Capital Plan:

Agree any recommendations for submission to the Executive in respect of the proposals outlined in Appendix C(a) for inclusion in the Capital Plan.

 

To recommend to the Council:

Formally confirming delegation to the Chief Financial Officer (Head of Finance) of the calculation and determination of the Council Tax taxbase (including submission of the National Non-Domestic Rates Forecast Form, NNDR1, for each financial year) which is set out in Appendix A(a).

 

The level of Council Tax for 2022/23 as set out in Appendix A (b) (to follow for Council) and Section 4 [page 17 refers].

 

Other Revenue:

 

Delegation to the Head of Finance authority to finalise changes relating to any further corporate and/or departmental restructuring and any reallocation of support service and central costs, in accordance with the CIPFA Service Reporting Code of Practice for Local Authorities (SeRCOP).

 

Capital:

 

Deletion from the Capital Plan of the Cambridge Junction capital scheme, as set out in Section 6 [page 29 refers].

 

Subject to any Executive decision above, recommend to Council the revised Capital Plan for the General Fund as set out in Appendix C(c) and the Funding as set out in Section 6, page 29.

 

General Fund Reserves:

 

Note the impact of revenue budget approvals and the resulting contribution from reserves to support service delivery [Section 8, page 44 refers].

 

Approve the allocation of funding on a contingency basis to the collaborative ‘Changing Futures’ programme project [Section 8, page 44 refers].

 

Note the resulting level of reserves [Section 8, page 44 refers].

Section 25 Report.

 

Note the Chief Finance Officer’s Section 25 Report included in Section 10 of the BSR [page 65 refers].

 

Review of Charges:

 

Note the schedule of proposed fees and charges for 2022/23 in Appendix F.

 

 

 

Reason for the decision

 

As detailed in the officer report.

 

Any alternative options considered and rejected

 

None.

 

Scrutiny considerations

 

Committee asked the following:

Why was there no provision for inflation?

How can Members scrutinise Transformation proposals?

 

The Executive Councillor for Finance and Resources replied that:

A full council review of the effect of inflationary pressure would be undertaken prior to adopting the Medium Term Financial Strategy in October 2022, but at present the approach first taken at MTFS 2021 of not inflation proofing because of both the current inflation rate uncertainty, and additional savings burden, was the recommended approach.  Regarding Transformation, a new Director of Transformation has been in post for 6 weeks and there will be a clear programme and further all Member briefings.

 

The Chair took questions on the BSR portfolio by portfolio.  Members of the Executive were present to answer questions from the Committee and spokespersons.

 

Finance and Resources:

 

It was confirmed the head leaseholders of Lion Yard did not want the Council to invest in any proposed developments.  The Council’s Officers meet the head leaseholders every quarter.

 

The Council’s property assets are under review and the Executive has given no direction regarding the future use of the Guildhall.

 

On Clay Farm s106, if it was required that a dispute resolution was required to arbitrate between the Council and Developer it would take between 3-6 months although it was hoped that would not be required.  If an income stream becomes a reality following the dispute resolution, it would be incorporated into the Medium Term Financial Strategy.

 

General Fund Housing:

 

Regarding the retrofitting grant, although it could not be used for HRA Council Properties and is for households with income less thank £30k, the Council is looking at ways to pick up eligible customers in the areas where the work is being planned on council housing.

 

Planning Policy and Transport:

 

 

Cllrs Bick and Porrer expressed concerns that the financial and usage data in relation to the decision taken on bus subsidy at Planning and Transport Scrutiny Committee on 11 January were only made known in the Executive Amendment.

 

The Director confirmed that the usage data had been previously submitted to committee but should ideally have been repeated in the most recent report. In regards to the financial data, the Director confirmed that a decision to stop the payment had been deferred owing to both the expectation, initially, that the pandemic impact would be of a shorter duration, and a request from Government, but that subject to the outcome of further queries, a refund on unused subsidy was being sought. Future provision of the service will be associated with the emerging Local Transport Plan.

 

Climate Change, Environment and City Centre

 

With reference to the out of hours service it was confirmed that the matter would come back to members of the Environment and Communities Scrutiny Committee in October 2022 with a full years data so that the decision taken last month can be confirmed or if needed, budget provision considered in time for future years.

 

With reference to public toilet provision, the income loss needed to be reflected and related to Park Street and Arbury Court toilets closing.

 

The scrutiny committee supported the recommendations 4-2 on the Executive Amendment and 4-0 on the original recommendations.

 

The Executive Councillor approved the recommendations as amended.

 

Conflicts of interest declared by the Executive Councillor (and any dispensation granted)

 

No conflicts of interest were declared by the Executive Councillor.

 

The Scrutiny Committee and members of the Executive asked questions on the Liberal Democrat amendment and noted the Green & Independent statement, both of which are reported to Council for consideration.

 

Liberal Democrat amendment:

B0005-Care Network.  It was confirmed that this proposal had been checked with the County Council which also provided funding.

CAP 0006- income from the cameras would go towards the running and maintenance of them and to roll-out further.

CAP 0007-It was not a city wide proposal as it was thought it would be a good trial to support this new community in Trumpington.