Agenda item

To receive a written report from the Cabinet Member for Finance, Performance & Customer Services, and to question the Cabinet Member thereon, provided any such questions are registered in accordance with the timescales and procedures set out in Standing Order 8.2.1.

Council received a written report from Cllr Williams, Cabinet Member for Finance, Performance and Customer Services.

Notice had been received of twelve questions on the report, submitted by Members in accordance with Standing Orders. The first five questions were put and answered as follows and Members agreed to receive written answers to their remaining questions, as set out below:

(i)           From Cllr Ayre

“What business case was produced to avoid duplicating ICT provision already provided by private operators?”

Cabinet Member replied:

“As the report to cabinet  makes clear individual cases will be subject to detailed review as and when they are considered. As regards duplicating other provision, if the council is to be able to respond to the severe financial reductions we have to look at generating additional income, and I see no reasons in principle as to why we should be overtly avoiding competition in a free market.” 

(ii)         From Cllr Gillies

“In light of Cllr. Williams comments on ensuring the continued financial health of the organisation can he inform Council of the amount of loan interest paid by the Authority in each of the last two financial years and the budgeted cost for the current and next financial years?”

Cabinet Member replied:

Answered in the meeting.

(iii)        From Cllr Cuthbertson

The Cabinet Member claims that the move to West Offices was completed “on budget”. A response to an FOI request earlier in the year suggested that the move cost £200,000 more than the original budget. Which is right?

Cabinet Member replied:

“The scheme overall was delivered in budget, as has been reported to cabinet in the capital monitor.”

An answer to a supplementary is being sent separately.

(iv)       From Cllr Healey

“Regarding the Budget and specifically the first quarter monitor, please detail the amounts of monies that are ‘un-achieved’ and ‘unachievable’ in the Q1 2013 monitor?”

 Cabinet Member replied:

Answered in the meeting.

(v)         From Cllr Runciman

“Could the Cabinet Member reveal how much the EPH (Elderly People’s Homes) programme will cost, what the original budget was, and how the £800,000 assumed savings in the 2013-15 budgets will be met?”

Cabinet Member replied:

“Like other questions, the broad details have already been reported to cabinet. The most recent cabinet report on this issue identified that the costs could be in the region of £25-30m. It also set out that a detailed procurement process needed to be undertaken to determine the actual costs, and associated revenue. This process is underway and again it would not be wise for me to reveal any further information until this process is concluded.” 

(vi)       From Cllr Gillies

“Again, in light of Cllr. Williams comments on ensuring the continued financial health of the organisation can he inform Council of the cost of salary increments in the last two financial years, and the estimated cost in the current and next financial years?”

 Reply:

In 2011/12 it was £1.8m,  2012/13 £0.8m, this year there is a budget provision made for £350,000,  and in 2014/15 we estimate the figure to be around £300,000

(vii)       From Cllr Cuthbertson

“Could the Cabinet Member confirm that the “profit” referred to in the section of the report on the City of York Trading Company includes all staffing costs and could he outline how much of the “profit” derives from contracts with public sector organisations and how much from the private sector?

Reply:

“I can confirm that staff costs have been factored in when reporting profit figures. All staff costs associated with the operation are met by the company. This includes the direct costs of staff employed by the company, and a full recharge of the staff who administer the service, plus other associated costs. The customer base during 2012/13 has been public sector, however over time I anticipate opportunities for other markets.” 

(viii)  From Cllr Healey

“Medium term financial management: Can the cabinet member inform council as to when this will be complete and the consultation he expects to undertake?”

 Reply:

“Its not entirely clear what Cllr Healey means when he quotes “medium term financial management” as this encompasses all aspect of the Councils finance. This is of course an ongoing process and is never “complete”. I presume the question relates to the budget process, in which case I can confirm that a further report on the budget strategy and issues will come to cabinet in November. This will set out further information, including the scale of reductions this Council is facing due to government grant reductions. We will be holding a range of budget consultation events, including meetings in wards, and with key stakeholders. As all members will be aware the budget strategy, and setting of Council tax will conclude at the February Council meeting.”

(ix)    From Cllr Ayre

“The Cabinet Member talks about maximising income from property sales. He specifically cites as an example the sale of the Edmund Wilson site in 2009. Is the Cabinet Member aware that this sale was conducted using a competitive bid process and that the receipt generated was over twice the professional valuation that had originally been put on the site?”

Reply:

“Yes.”

(x)         From Cllr Ayre

“In the light of the new buoyancy in the York development market place, will the Cabinet Member agree that all sales of Council property and land will be subject to a competitive process which maximises the receipt that is available for the taxpayer?”

Reply:

“In an earlier question Cllr Ayre seems to be arguing against competition and in this question he is arguing for it. I would have hoped for a more consistent approach from him.

Of course the default position should be to go to the open market. However, there will always be some situations where it makes financial and economic sense not to stick to that default position and not to have a competitive process. This should be if it is felt that one organisation has a special interest in a site and would pay a premium above the going market rate to obtain the site. An example of this would be a sitting leaseholder who wishes to buy the freehold. To have a blanket policy would simply expose the council to potentially not maximising the use of assets. The Labour Council's policy is about pragmatism over ideology, something of which I would have thought he would approve.”

(xi)   From Cllr Ayre

“The Cabinet Member refers to the financial work being undertaken on the Community Stadium in his report. Would he confirm what he expects the total revenue and capital contributions from York taxpayers (excluding S106 contributions) will be to this project including the associated works being undertaken at University of York sites?”

Reply:

“Detailed information on the capital and revenue costs has been to Council previously. As this process is currently subject to a detailed procurement process it would not be sensible to disclose any further information other than that already in the public domain.”

(xii)   From Cllr Ayre

“On budgets, could the Cabinet Member outline the existing and future borrowing commitments for the EIF (Economic Infrastructure Fund) and what would be the revenue saving if this borrowing were cancelled?”

Reply:

“The commitments on the EIF have been reported regularly to cabinet. Funding for the EIF comes from a mix of New Homes Bonus and borrowing. Some 30 per cent of the fund is financed from the New Homes Bonus. Actual borrowing is done for the Council as a whole, not by individual project. Decisions as to when to borrow, in terms of the councils whole capital programme are made by the Finance Director. Based broadly on around £18m of the EIF being committed or allocated to date, and assuming 70 per cent of this is borrowing, the annual costs of borrowing are broadly £0.5m of interest, and £0.5m of debt repayment per annum. These should be seen against the huge benefits that this programme will bring in terms of jobs and growth to our economy.”