Agenda item

Purpose:  To report on the quarter one capital financial performance.

Resolved to note the report.

This decision is not subject to call in as:

·      Report is to note only

therefore it will be implemented immediately.

The Executive considered a report (Agenda Item 7) which outlined the Quarter One capital financial performance.

In presenting the report, Councillor Jeff Cant drew attention to the progress being made with commercial property investment. The Council had achieved some success from investing in sound commercial property opportunities that had become available in recent years. However, these opportunities had been reducing.

The Council was therefore taking a prudent approach by reviewing the Property Investment Strategy and how funding was best invested. Until this review was completed, forecasting was based on the likelihood that the Commercial Property budget of £35 million would not be spent in year. This would result in budgeted revenue returns not being achieved and ways to offset this were being looked at.

Councillor Erik Pattenden noted that there was a £1.8 million underspend forecast in Education Services, much of which related to delays in The Willink expansion. He questioned the impact this was having on The Willink’s students. Councillor Dominic Boeck confirmed that the delay to this project had no impact on students.

Councillor Alan Macro queried some of the underspends reported in Development and Planning. He firstly asked why the purchase of temporary accommodation had not completed. Councillor Hilary Cole explained the importance of ensuring that this accommodation was suitable for homeless families. Homes would need to be in close proximity to schools and accessible via public transport. Two properties remained to be purchased, nine had already been purchased. It was very important to have these properties to avoid the use of bed and breakfast facilities.

Councillor Cole added that the Council was in the process of purchasing more properties for the Housing First scheme.

Councillor Macro then queried the £559k underspend against the Disabled Facilities Grant (DFG). This was a demand led budget and Councillor Macro asked if enough was being done to promote awareness of this fund. Councillor Cole advised that the DFG was well advertised and eligible residents were signposted to it. It was a successful scheme and people were encouraged to come forward to apply for funds. The DFG was administered by a well-managed team who processed applications in a timely manner.

Councillor Graham Bridgman added to this response by explaining that the total DFG budget was contributed to by Council funding. The DFG was being spent subject to suitable applications coming through and the underspend meant that the Council’s financial contribution to the fund could reduce.

Councillor Lee Dillon suggested that future versions of the budget papers should show information separately for the DFG, i.e. DFG and Council funding. Councillor Cant agreed that this change would be made.

Councillor Dillon referred back to the points made on temporary accommodation and agreed that the provision needed to be suitable. He then asked if the Council had considered developing its own site rather than seeking to purchase a purpose built property.

Councillor Cole advised that all options would be considered. However, the Council was limited by the land it owned and could therefore develop. She did however highlight the Council’s Joint Venture with Sovereign Housing Association for the provision of affordable housing.

Councillor Steve Masters questioned whether all options would be considered. He had previously made a suggestion that an investment pot could be created to fund a mix of accommodation that could form part of the property portfolio. He had given the Kennet Centre as an example at that time. Councillor Masters had been told this was ‘too risky’ but he queried whether a risk assessment had been conducted as he felt this could be commercially viable.

Councillor Lynne Doherty explained that a proposal of this type fell outside of the remit of the current Property Investment Strategy. She added that the Kennet Centre was a retail space.

Councillor Dominic Boeck made the point that the Property Investment Strategy did not permit investment in speculative prospects and the Kennet Centre would fall within that. It could become a consideration post the review of the Strategy but it currently fell outside of its remit.

Councillor Masters commented that property investment was speculative. Councillor Doherty responded by advising that investment opportunities would only be pursued if they adhered to the Strategy.

RESOLVED to note the report.

Other options considered: Not applicable.