Agenda item

Key background documents for this item are:

a. Medium Term Financial Plan and Capital Strategy, as considered at the 31 October Full Council

ModernGov - bristol.gov.uk

b. Previous Resources Scrutiny/Finance Task Group comments as submitted to the 31 October Full Council

FTG submission for Full Council - 31 Oct 23.pdf (bristol.gov.uk)

c. Budget 2024-25 consultation as published on the Ask Bristol consultation and engagement hub

https://www.ask.bristol.gov.uk/budget-2024-25

In this session, the Resources Scrutiny Commission will consider the following issues:

a. Growth & Regeneration - clarification on CAZ income/utilisation (20 minutes)

Budget proposal reference points:

GAP 043 - Alternative investment in sustainable transport using net proceeds from CAZ - £6.3m 24/25

We would use net proceeds from Clean Air Zone charges to contribute to the amount of money we

pay to the West of England Combined Authority for the annual Transport Levy, which supports the Local Transport Plan, funding concessionary fares and other public transport related services.

GAP 057 - Use Clean Air Zone funds to maintain and improve the highways network - £2.311m 24/25

We would use net proceeds from Clean Air Zone charges to carry out repairs and improvement works on the city’s roads and footpaths. These works would support the Local Transport Plan by keeping our roads and footpaths safe for all users, encouraging walking and cycling and reducing traffic congestion.

Key questions/areas of scrutiny interest as identified in advance of this meeting by Resources Scrutiny members:

1. What is the position now in relation to CAZ income, and what are the future projections?

2. What other assumptions have been made in terms of the use of CAZ income?

3. When CAZ was introduced, a key part of the rationale/justification was that income would be used to secure cleaner air and environmental benefits for the city, including, for example through direct investment in active travel.  What is the justification (as per GAP 057) for utilising CAZ income to support what appear to be general repairs and improvement works?

b. Resources issues (20 minutes)

Key questions/areas of scrutiny interest as identified in advance of this meeting by Resources Scrutiny members:

1. Contingency: Are appropriate assumptions in place in terms of financial contingency provisions, given the ongoing factors of high levels of inflation/ interest rates?

2. Fees and charges:

Budget proposal reference point:

GAP038 - Fees and charges budget review

Review and where appropriate revise the budgets for fees and charges across sources of income that have repeatedly outperformed their approved budgets in recent years, reflecting where we are already receiving greater levels of income.

Is the authority satisfied that this proposal should proceed without further equalities impact analysis?

c. Capital strategy (30 mins)

Key questions/areas of scrutiny interest as identified in advance of this meeting by Resources Scrutiny members:

1. Assurance/clarification is sought on the action and measures being taken in relation to the governance, management and delivery of the capital programme, particularly in relation to slippage within the programme and addressing any inflationary impact of slippage/delay.

2. Based on this and recent years’ experience, what action will be taken to ensure closing the significant gap between ‘intent to deliver’ (as reflected in the capital programme budget) and actual delivery, so there is greater certainty on delivery?

3. Are external factors affecting capital programme delivery such as the impact of new environmental and planning requirements being appropriately factored into future forecasting?

Note: the meeting to be adjourned by 5.30 pm; Part 2 of the meeting is scheduled to take place at 9.30 am, Friday 15 December 2023.

a. Growth & Regeneration - clarification on Clean Air Zone (CAZ) income/utilisation

Members had identified in advance of the meeting that they wished to raise questions on the following budget proposal reference points:

GAP 043 - Alternative investment in sustainable transport using net proceeds from CAZ - £6.3m 24/25

We would use net proceeds from Clean Air Zone charges to contribute to the amount of money we

pay to the West of England Combined Authority for the annual Transport Levy, which supports the Local Transport Plan, funding concessionary fares and other public transport related services.

GAP 057 - Use Clean Air Zone funds to maintain and improve the highways network - £2.311m 24/25

We would use net proceeds from Clean Air Zone charges to carry out repairs and improvement works on the city’s roads and footpaths. These works would support the Local Transport Plan by keeping our roads and footpaths safe for all users, encouraging walking and cycling and reducing traffic congestion.

Summary of main points raised/noted in discussion of this item:

a. In response to questions, the Deputy Mayor for City Economy, Performance and Finance and Executive Director: Growth and Regeneration advised as follows:

i. The CAZ was essentially a public health intervention required of the Council by the government. 

ii. Data on the effectiveness of the CAZ in reducing levels of nitrogen dioxide and improving air quality would be provided at the end of 12 months. It was considered that providing detail of CAZ financial income in the meantime would prove to be a misleading figure.  Information on both matters would be provided, at the same time, to the Cabinet meeting on 23 January 2024, i.e. at the same meeting at which the Cabinet would determine its 2024/25 budget recommendations to Full Council.  It was acknowledged that at an earlier point, an indication had been given that this information might be available for the 5 December Cabinet; however, the analysis of air quality had taken longer than initially expected to provide the full 12 month position.

b. In response to a question, it was confirmed that there was an improved position overall in terms of vehicle compliance with CAZ standards.

c. It was noted that the CAZ update information (income and air quality assessment) would also be provided to the Overview and Scrutiny Management Board (OSMB) in January.  The Chair commented that careful consideration would need to be given to the timing of the OSMB meeting to ensure that OSMB members had reasonable time to read these reports in advance of their meeting; discussion would also need to take place with the OSMB Chair about how best to involve Resources Scrutiny members during January in reviewing the financial aspects of CAZ (Note: it was subsequently agreed that Resources Scrutiny members would be invited to attend the relevant section of the January OSMB meeting).

d. In response to a question, it was noted that it was possible that the CAZ could potentially be discontinued after a further 3-4 years if air quality improved and pollutant levels were brought within legal limits.  The timeframe for the CAZ was driven by the legal compliance issue, so that would determine how long it lasted. It was also noted, however, that it was possible that limits could be tightened further at a future point, in which case the CAZ could be in place for a longer period than was currently being assumed. 

e. It was noted that if the CAZ did end at a future point, there could be a significant financial gap/spending pressure for the Council to bridge at that point in relation to council spend that had, in effect, been funded through surplus CAZ income.

f. As per the response given to a question raised during the public forum, officers reiterated that the allocation of the use of CAZ surplus income was being applied in accordance with legislation and government rules/guidance.

b. Resources issues

Summary of main points raised/noted in discussion of this item:

1. General questions, including contingency:

a. As per the earlier discussion, it was reiterated that the Chancellor’s Autumn Statement had given no indication that the Household Support Fund would be extended into the next financial year. It was noted that a significant element of this funding had been used in 2023/24 to provide free school meal vouchers for free school meal and pupil premium qualifying children during some of the school holiday periods.

b. It was noted that in the Autumn Statement, no additional core revenue funding had been announced for local authorities beyond the increases that were already expected.  The cost of wage increases would need to be factored into the Council’s budget preparation, taking account of the fact that the Council was a real living wage employer.

c. It was noted that the additional revenue costs resulting from the Barton House evacuation/situation would be met from the Housing Revenue Account (HRA) reserve; the 30 year HRA Business Plan was being reviewed to take account of this.

2. Fees and charges:

Members had identified in advance of the meeting that they wished to raise questions on the following budget proposal reference point:

GAP038 - Fees and charges budget review

Review and where appropriate revise the budgets for fees and charges across sources of income that have repeatedly outperformed their approved budgets in recent years, reflecting where we are already receiving greater levels of income.

In response to questions, it was noted that there was no equalities impact in relation to this matter; in this case, the budget was effectively being re-set to reflect actual income received.

3. Capital strategy:

Summary of main points raised/noted in discussion of this item:

a. HRA: In response to a question, it was noted that a programme of works was being undertaken in relation to cladding issues on tower blocks, prioritised to aim to reduce ‘waking watch’ costs as quickly as possible.

b. Skills and knowledge: It was noted that work was taking place to enhance staff skills around capital programme forecasting/management and investment, recognising the importance of maximising delivery against the programme.  It was suggested that it would be useful to report back to members in due course on the roll-out of skills enhancement in these areas.

c. It was noted that the Council’s capital programme governance and reporting was improving; the context of the national economic situation still presented significant challenges, however, to delivery, e.g. the slow-down in new house building and ongoing supply chain difficulties.

At the conclusion of the discussion, the Chair stated that he would like to place on record his thanks to the Director: Finance and other members of the Finance team who had supported the sequence of Finance Task Group briefings that had been ongoing since the summer.  Members were appreciative of the openness and diligence shown by officers in responding to questions and points of clarification as these sessions had progressed.

On the motion of the Chair, the meeting was then adjourned at 3.45 pm, noting that the meeting would reconvene at 9.30 am on 15 December 2023.