Agenda item

Q1 2020/21 performance report

To consider the Performance Report for Quarter 1 (2020/21) and to make any observations.


Members considered the Performance Report for Quarter 1 (2020/21) which looked at Key Performance Indicator reporting, as well as revenue and capital budget monitoring for the three months from 1 April to 30 June 2020.

Cllr V. Lewanski, Portfolio Holder for Corporate Direction and Governance, gave an overview of progress on the Key Performance Indicator (KPIs). A cross-party member working group in the last financial year had developed the 2020/21 indicators which were approved by the Executive at its meeting on 25 June 2020. Cllr V. Lewanski thanked Members for their valuable input into updating the new KPIs. A new reporting template with additional narrative had been developed and was available at Annex 1.

Ten KPIs were reported on in Quarter 1 2020/21, six were on target and one (KPI 8 – Performance in Local Environmental Quality Surveys) could not be reported on due to resources focused on responding to the COVID-19 crisis.

The three red-rated KPIs were: KPI 6 – Net housing completions, KPI 7 – Net affordable housing completions and KPI 10 – Recycling performance (Q4 2019/20). Housing completions were off target due to the slowdown in the construction sector as a result of the COVID-19 pandemic. Despite this there were currently over 2000 units under construction and over 300 were affordable.

KPI 10 – the Council’s recycling performance indicator that measures the percentage of household waste that is recycled and composted was affected by seasonable fluctuations and reduction in garden waste collected at the kerbside. However, it remained in line with the same quarter reported the previous year. Overall, the final year’s recycling rate in 2019/20 of 54.2% was the Council’s second-best reported rate.

Cllr N. Harrison thanked the projects and business assurance team for the new report format including the additional analysis in the report.

Members made the following observations and comments:

·         Housing completions – it was noted that COVID-19 lockdown had effectively halted housing construction work for two months, so the red-rated status was to be expected. It was anticipated that this would improve in the next quarter of the year.

·         Recycling – there was a downturn in recycling performance in quarter 4 2019/20 due to the seasonal variations in collecting garden waste. Due to the COVID-19 lockdown there had been significant increases in collection of food waste, mixed paper and card and mixed glass. There will be an impact to this KPI in quarter 1 due to the garden waste service being temporarily suspended. However, this is expected to  improve in quarter 2 following the garden waste service restarting and the continued increase in mixed recycling materials. Members asked about increased public engagement and education so residents understood what can be recycled. It was noted that these were part of ongoing discussions with the Surrey Waste Partnership.

Members noted that the Borough Council target for recycling had increased to 60% which was set out in Surrey’s Joint Waste Management Strategy. They asked for a written answer about the plan in place to meet this target, post COVID-19 recovery.

·         Flats recycling programme – this work had been paused as the Waste and Recycling Service prioritised resources on frontline services during the Covid-19 pandemic emergency response. Discussions were underway with the Executive Member for Neighbourhood Services on restarting the programme to provide a full range of recycling services to residents in an additional 6,000 flats in the Borough. This would increase the amount of recycling.

Committee Chair, Cllr N. Harrison, expressed the Committee’s thanks to the Head of Projects and Performance, Doula Pont, who was leaving the Council at the end of September.

Clerk’s note: Cllr S. Walsh joined the meeting at 8.42pm.

Cllr T. Schofield, Portfolio Holder for Finance, gave an overview on the Revenue Budget and Capital Programme forecasts in Quarter 1. The Revenue Budget 2020/21 approved by Full Council in February 2020 was £24.46m. At the end of quarter 1, the projected full year outturn forecast was £24.22m against a management budget of £25.90m (including £1.44m one-off funding from the Corporate Plan Delivery Fund Reserve and Feasibility Studies (Commercial Ventures) Reserve). This resulted in an overall net underspend of £1.68m (6.5 percent) at the end of Quarter 1 (30 June).

It was noted that the Budget was approved prior to the COVID-19 pandemic and ensuing emergency response. The financial implications of COVID-19 on the Council were being closely monitored and set out in an annex to the report. They were also presented in more detail the Medium-Term Finance Strategy 2021/22 which was reported to Executive on 27 July 2020.

The additional unbudgeted cost to the Council of COVID-19 was predicted (at 30 June) to be £3.024m, including additional costs of the emergency response (provision of food  and welfare calls), housing rough sleepers and remote working costs. There was also a projected £3.74m loss of income, compared to 2020/21 budget forecasts, including from Harlequin theatre ticket sales, planning fee income, garden waste charges and car parking income. It was noted that, while there was a forecast £317k reduction in income from commercial tenants, the majority of property rents continue to be collected.

These additional budget pressures were expected to be offset in part by Government grant; £1.16m had been received by the end of quarter 1.

The Capital Programme at the end of quarter 1 was forecast to be £30.4m below the approved expenditure for the year which as expected was largely slippage on construction projects, some of which was due to the impact of COVID-19 on the construction industry. It was expected that work would resume in quarter 2.

Members made the following comments and observations:

·         COVID-19 financial implications – Members noted that as at 30 June, the net adverse financial impact, if no further government support is given, may be up to £3.024m, based on the forecast additional expenditure and income losses, less the announced Government grant at that date. Even if the Government provided the maximum support of 70% to reimburse the loss of non-commercial income, the Council would be left with a deficit in the region of £1.250m based on 30 June forecasts. The Committee requested additional summary reporting on the COVID-19 emergency response impacts in future reports. The Interim Head of Finance explained the annex to the report budget report set out the emerging picture (at 30 June) of the COVID-19 financial implications and that the situation continued to evolve as new Government announcements were made. It was noted that it was challenging at this early stage in the financial cycle to present a complete and accurate forecast of the full implications for this Council. Further consideration will be given to how the information is presented in the quarter 2 report.

·         Impact of COVID-19 on Collection Fund – It was noted that the impact of business rate and council tax income shortfalls as a consequence of COVID-19 would be accounted for through the Collection Fund. This would eventually have an impact on the budgets of all precepting authorities (Surrey County Council, the Police and Crime Commissioner and the Government) as well as this Council in 2021/22 onwards.  The forecast risk to the Collection Fund at 30 June was £10.137m income losses.

·         Feasibility Studies (Commercial Ventures) Reserve – Members asked for a written response to give further information about the feasibility studies work carried out on Horley High Street Car Park and delivering change in Horley Town Centre. They also asked for confirmation of the sum allocated from the Reserve to Project Baseball.

·         Staff headcount  it was noted that this year’s budget allowed for an increased number of  funded posts and Members asked for an update on progress in filling them. The Interim Head of Paid Service said the majority of new posts related to the transfer of staff at the three Community Centres that had been brought back in-house and the Harlequin theatre casual staff who transferred to permanent contracts at the start of the financial year. There was not currently a high number of vacancies in other services. Staff turnover was about 11 per cent currently which was similar to previous years of 10 to 12 per cent. This was considered a healthy level and was consistent with other boroughs and districts in Surrey. Leader, Cllr Mark Brunt, confirmed that Executive Members planned to review staffing requirements as part of service & financial planning 2021/22 discussions across each of the portfolios. It was noted that proposed local government reorganisation was likely to make it more difficult to recruit to vacant senior posts.

RESOLVED – that:

(i)            The Key Performance Indicator performance for Q1 2020/21 and observations of the Committee be noted;

(ii)          The Revenue Budget and Capital Programme forecasts at Q1 be noted; that the Committee’s request for additional reporting on COVID-19 financial implications in the covering report be highlighted to the Executive at its meeting on 17 September 2020.

(iii)         The full year Capital Programme forecast at the end of Q1 of £30.48m (24%) below the approved Programme for the year be noted.

Supporting documents: