Agenda, decisions and minutes

The minutes of the meeting held on 25 May 2016 were submitted and approved and the chairman was authorised to sign them as a correct record.

Declarations of disclosable pecuniary interests (DPIs) by members as required under Section 31 of the Localism Act and of other interests as required by the Code of Conduct and regulation 12(2)(d) of the 2012 Access to Information Regulations.  (Please see note at end of agenda).

Declarations of disclosable pecuniary interests (DPIs) by members as required under section 31 of the Localism Act and other interests as required by the council’s code of conduct and regulation 12(2)(d) of the Local Authorities (Executive Arrangements) (Meetings and Access to Information) (England) Regulations 2012.

Councillors Tutt and Shuttleworth both declared personal (and non-prejudicial) interests in matters the subject of minute 18 (Housing and economic development programme - Acquisition of housing by Eastbourne Housing Investment Company Ltd.) as they were council appointed non-executive directors of Eastbourne Housing Investment Company Ltd. (EHICL).  Councillor Tutt chose to withdraw from the meeting and take no part in order that he could participate in this matter at EHICL’s board meeting.  Councillor Shuttleworth chose to remain and participate on the basis that he would withdraw and not participate at EHICL’s board meeting.

Report of Financial Services Manager.

Cabinet lead member: Councillor Gill Mattock.

Final outturn for 2015/16 agreed and transfer to reserves and provisions as set out in paragraphs 2.3 and 3.2 of report approved.

14.1 Cabinet considered the report of the financial services manager presenting the annual accounts and final budget outturn figures for the financial year ending 31 March 2016.  Under the Accounts and Audit Regulations 2011 the deadline for the council to approve the annual accounts was 30 September, after the external audit had been completed. 

14.2 A report to cabinet on 25 May 2016 set out the provisional outturn for 2015/16.  The forecast was for a credit variance of £195,000 on service expenditure.  Since that time the work on closing the accounts had been completed and the final outturn confirmed.  The general fund service outturn was a favourable variance of £204,835.  The main change from the details of the service variances reported to the 25 May cabinet meeting related to an adjustment to the provision for bad debts relating to housing benefits overpayment, accrual adjustments for the building control management fee, the Steria IT contract and an increase in the legal fees chargeable to the housing revenue account.  The general fund balance at 31 March 2016 was £3.3m.  Details of other reserves were included in the accounts.

14.3 In addition to the transfers to and from reserves as approved by cabinet in May, a transfer of £575,381.51 had been made to the capital programme reserve in line with the budget strategy representing the balancing mechanism on capital financing costs.  This included savings on external interest payable due to the continued use of internal balances and the actual timing of capital spending incurred compared to the expected cash flow profile.

14.4 The housing revenue account (HRA) figure previously reported to the cabinet in May set out a favourable variance of £218,000. The final net expenditure for the year was a surplus of £527,929 a favourable variance against budget of £231,979, due to an accounting adjustment for capital funding from revenue.  The HRA balance as at 31 March 2016 was £3.7m.  In addition to the transfers to and from reserves approved by Cabinet on 25 May, a transfer of £793,000 had been made to the housing regeneration and investment reserve in line with the budget strategy and the 30 year housing business plan.  This represented the variance between the budgeted and actual depreciation allowance.

14.5 The final capital expenditure for the year was £18.0m compared to a revised budget of £19.9m a variance of £1.9m (general fund (£0.3m) and HRA (£2.2m)) or 9.5%. 

14.6 The outturn formed part of the draft statement of accounts reported to the audit and governance committee on 22 June 2016.  The committee would be asked to formally approve the accounts at their September meeting.  The draft statement of accounts was available on the council’s website and copies could be obtained from financial services.  An overview and key points of interest was given in appendix 1 to the report. 

14.7 It was the chief financial officer’s responsibility to ensure the preparation of the statement was in accordance with the CIPFA/LASAAC code of practice on local authority accounting in the  ...  view the full minutes text for item 14.

Report of Deputy Chief Executive.

Cabinet lead member: Councillor Gill Mattock.

(1) Updated MTFS and associated plan 2016-20 approved.

(2) Balance of assumptions made in strategy agreed.

(3) Emerging budget proposals for 2017/18 to be brought to cabinet in December prior to detailed consultation and that the MTFS be re-presented if material changes arise in the interim.

(4) Principal risks of strategy (appendix1) agreed.

15.1 Cabinet considered the report of the deputy chief executive (and chief finance officer) giving an update on the council’s financial strategy which focussed on the general fund for the period up to 2020.  A separate report on the 30-year housing revenue account business plan would be presented to cabinet in the autumn.  The council was faced with reducing support from government and in order to protect front line services needed to find efficiency savings and new income streams to maintain a balanced budget.  The ability to raise council tax was limited to 2% (or £5 per band D property) per annum.  The use of reserves was only valid for one off expenditure in order to keep the budget sustainable.

15.2 The medium term financial strategy (MTFS) was a rolling 4 year strategy that took into account:

• The external financial environment.
• The overall financial demands of services.
• The council’s existing and projected financial resources.
• The council’s political priorities and stated aims.
• The council’s sustainable service delivery strategy.
• The council’s corporate plan.
• The major service strategies and plans.

The MTFS had last been approved in July 2015 and set the backdrop for the 2016/17 budget setting process as well as a informing a 3-year rolling service and financial planning cycle. 

15.3 Over the life of the last parliament the government effectively reduced the general support to the council by some 50% in cash terms which equated to over 60% in real terms.  Government funding was expected to fall a further 30% over the current parliamentary cycle to 2020. 

15.4 To protect front line services the council had put in place a priority based budget system that had kept pace with the scale of cuts to funding and made provision for reinvestment in services.  The council aimed to become less dependent on day to day revenues to run services, instead opting to use any spare financial capacity to enhance the capital programme.  The council’s DRIVE programme provided the programme to deliver efficiencies that support the council’s corporate plan. The MTFS and capital strategy identified and directed resources at a strategic level, which were then compounded via the service and financial planning and budget setting process.

15.5 In setting recent annual budgets the council had achieved its “golden rule” of meeting its ongoing budget requirement from ongoing resources in each year.  Technically, the rule applied to the cycle of the MTFS, and it was reasonable to use reserves to smooth out the budget as savings accrued over the cycle.  By not using reserves in this manner it had meant that reserves over the minimum level were available for one off investments in services decided via the service and financial planning process.

15.6 The council, as a registered social landlord, was obliged to run a housing revenue account (HRA) that was statutorily ring-fenced from its general fund.  A 30-year rolling business plan had been adopted for the HRA.  The council was working in partnership with Eastbourne Homes Ltd. (EHL), a wholly owned subsidiary, to  ...  view the full minutes text for item 15.

Report of Senior Head of Corporate Development and Governance.

Cabinet lead member: Councillor Troy Tester.

Full council recommended to approve the revised code of conduct for employees of the borough council.

16.1 Cabinet considered the report of the senior head of corporate development and governance.  The code of conduct laid out the standards of behaviour expected of council employees.  The code formed part of the contract of employment and must be followed.  A breach of the code could lead to disciplinary action and even dismissal depending on the severity of the breach.

16.2 Minor revisions to the code were proposed and included reference to safeguarding, the use of loyalty cards when purchasing items on behalf of the council and the form for declaring personal relationships at work.  A copy of the revised code was appended to the report.  These revisions had been undertaken in consultation with Unison and with consideration to ACAS best practice guidance and the needs of the business.

* 16.3 Resolved:  That full council be recommended to approve the revised code of conduct for employees of the borough council.

Report of Senior Head of Community.

Cabinet lead member:  Councillor Steve Wallis.

(1) Revised enforcement policy statement approved for publication for a 6-week consultation period.

(2)Senior head granted delegated authority, in consultation with the chair of planning committee, to make any non-substantive change to the policy.

(3) That, subject to the delegation granted above,  the enforcement policy statement 2016 be adopted.

17.1 Cabinet considered the report of the senior head of community.  The effective and proper enforcement of planning controls was essential to protect the local environment and interests of residents, visitors and businesses of the borough from the harmful effects of unauthorised works.  The council had a duty to investigate alleged breaches of planning control and had powers to remedy proven breaches by statutory and other means.  It was the council’s policy to exercise these powers appropriately and proportionately so that development took place in accordance with the appropriate legislation or conditions and limitations imposed on any planning permission.  National guidance expected local authorities to publish a local enforcement policy.  The current policy, in use since 2010, had been updated over the years in line with legislative changes.

17.2 The policy had been endorsed by the council’s planning committee (July 2015) and also by the local plan steering group.  Cabinet approval was now sought to give formal status to the policy.  Members requested that the policy be updated at least annually to reflect legislative and regulatory changes and noted that substantial changes only would require further consideration and approval by cabinet.

17.3 Resolved (key decision): (1) That the revised enforcement policy statement be approved for publication for a 6-week consultation period to receive representations on its content.

(2) That following the end of the representation period, the senior head of community be granted delegated authority, in consultation with the chair of the council’s planning committee, to make any non-substantive change to the policy.

(3) That, subject to the delegation granted above, the enforcement policy statement 2016 be adopted.

Report of Senior Head of Community.

Cabinet lead member:  Councillor Alan Shuttleworth.

(1) That the council makes a loan facility available of up to £5m on market terms to Eastbourne Housing Investment Company Ltd (EHICL) for the purpose of enabling the company to purchase residential accommodation.

(2) Senior head of community, in consultation with lead cabinet members for community and finance, granted delegated authority to agree the whole scheme lending parameters for purchases, to include types of property and financial viability.

18.1 Cabinet considered the report of the senior head of community.  In October 2014 Cabinet had approved the establishment of a new asset holding company (trading as Eastbourne Housing Investment Company Ltd (EHICL)) to help maintain progress on housing and economic development.  In approving the establishment of the company, cabinet noted that this would create capacity to hold some of the council’s property portfolio in a separate vehicle and thereby differentiate between its general needs stock and other forms of housing and tenures. 

18.2 The report sought approval for a loan facility up to £5m for EHICL to purchase residential properties on the open market and council homes sold as part of the future high value assets disposal programme being introduced under the Housing and Planning Act.  This would allow the purchase of some 30 to 40 properties.

18.3 The council had a statutory duty to provide advice and assistance to households in housing need.  The report highlighted a number of factors which had led to this proposal to purchase of suitable residential properties by EHICL for rental:

·         Over the past year the demand for accommodation had increased and placements in temporary accommodation had risen. 

·         Social housing (council housing managed by Eastbourne Homes Ltd and housing managed by registered providers) was under significant pressure and locally the number of homes becoming vacant had reduced. 

·         Securing private rented accommodation was becoming significantly more difficult, particularly for those on benefits. 

·         Recent changes to benefit regulation meant that the council was unable to recover all of the costs of arranging accommodation for households that were placed in emergency accommodation.

18.4 Housing provided by EHICL would also assist the council meet its wider economic and regeneration aims by ensuring that accommodation was kept in good condition.  In addition, in certain circumstances it might support the purchase of accommodation in areas of deprivation or decline requiring investment through cross subsidy within the wider company property portfolio.

18.5 The financial viability of each prospective acquisition would be assessed as a stand-alone project and continuous monitoring of demand for housing need would be undertaken to mitigate voids and/or capital losses.  The report set out key risks and factors to mitigate those risks and the legal basis under which the acquisitions and loans could be made.

18.6 Resolved (key decision): (1) That the council makes a loan facility available of up to £5m on market terms to Eastbourne Housing Investment Company Ltd (EHICL) for the purpose of enabling the company to purchase residential accommodation.

(2) That the senior head of community, in consultation with the lead cabinet members for community and finance, be granted delegated authority to agree the whole scheme lending parameters for purchases, to include types of property and financial viability.

(Notes: (1) Councillors Tutt and Shuttleworth both declared personal interests in relation to the above minute.  See minute 12 above.)

(2) Councillor Mattock took the chair for this item.

(3) Ian Fitzpatrick, senior head of community (and managing director of Eastbourne Homes Ltd.), advised members  ...  view the full minutes text for item 18.