Agenda and minutes

82/21 – APOLOGIES FOR ABSENCE AND NOTIFICATION OF SUBSTITUTES: There were no apologies for absence.

(5.31 pm)

Members to advise of any declarations of interest.

83/21 – DECLARATIONS OF INTEREST: There were no declarations of interest.

(5.31 pm)

of the meeting of 5 January 2022

84/21 – MINUTES: The Minutes of the meeting of the Cabinet held on 5 January 2022 were approved as a correct record.

(5.31 pm)

To determine whether to exclude the press and public during the consideration of any exempt information items – items 5 (part), 7, 10 (part) and 11 (part).

85/21 – EXEMPT INFORMATION: The report considered at Minute 88/21 and the appendices to reports considered at Minutes 86/21, 91/21 and 92/21 were considered to be exempt under paragraph 3 of Schedule 12a to the Local Government Act. Discussion on the items took place in open session.

(5.32 pm)

86/21 – 2022/23 DRAFT BUDGET AND 2023/24 INDICATIVE BUDGET:

In accordance with Council and Policy Framework Procedure Rules, the Chair of the Overview and Scrutiny Commission, Councillor Chris Aldred to submit a written report.

a)      Overview and Scrutiny Commission Findings: In accordance with the Council’s Budget and Policy Framework Procedure Rules, the Chair and Vice Chair of the Overview and Scrutiny Commission, Councillors Chris Aldred and Sam Gibbs, submitted a joint written report presenting the comments of the Overview and Scrutiny Commission in relation to the Executive’s budget proposals for the 2022/23 draft budget and the 2023/24 indicative budget.  The report gave details of the process undertaken by the Commission in considering the budget, which had involved an informal meeting of the Commission on 10 January to consider the focus for the subsequent formal budget scrutiny meeting on 17 January 2022 and ensure that further information was provided where required.  The report set out those issues which had been considered by the Commission, and Councillor Aldred drew Cabinet’s attention to Section 9 of his report which detailed the Commission’s overall comments on the budget.  The Commission was grateful to everyone within the Council for their hard work during a difficult year and thanked finance staff for their work on the budget.  The Leader thanked the Commission for its comments in relation to the budget.

The Commission endorsed the recommendations of Cabinet of 5 January 2022 in relation to the Draft Budget for 2022/23 and Indicative Budget for 2023/24, and including the Draft Housing Revenue Account Budget for 2022/23.

Further to Cabinet Minute 78/21, the Head of Finance to submit a written report.

b)      Latest Position: Further to Cabinet Minute 78/21 of 5 January 2022 the Head of Finance submitted a written report on the latest position in relation to the 2022/23 draft budget and 2023/24 indicative budget.  Since publication of the agenda the Business Rate deficit for 2021/22 had been updated following the proposed application of further Business Rates reliefs, the COVID Additional Relief Fund.  This deficit would be fully met by Government grant and would have a net nil effect on the budget.  Appendices 2a ‘Budget Summary Movements Revised’ and 2b ‘2021-24 Controllable Budget Summary’ had been updated to reflect this and updated copies made available to Members.

Since the meeting of 5 January there had been five updates to the budget position, as detailed at paragraph 5.3 of the report:

(i)     the annual NNDR1 return to Government, which formed the basis of the declared Business Rates Income for the following year had been drafted and showed a net increase of £270k in Business Rates income for 2022/23 (net increase of £40k in 2023/24) compared to the estimate in the original report;

(ii)    an update to the estimated 2021/22 collection fund deficit figures had been received.  This showed a £52k decrease in the Council Tax Deficit payable in 2022/23 (£53k increase in 2023/24) with a corresponding £52k decrease in the transfer from reserve to offset the deficit (£53k increase in 2023/24);

(iii)   removal of the dividend payment from Bracewell Homes to the Council of £268k from 2022/23 following a recent update to the company’s business plan;

(iv)  an uplift in the Lower Tier Services Grant of £262k in 2023/24 based on updated financial modelling; and

(v)   following finalisation of the Capital and Investment Programme at Minute 88/21 the Minimum Revenue Provision for debt repayment has been updated with an increase in the provision in 2023/24 of £18k.

Overall the changes resulted in an increase in the transfer to the Budget Transition Fund in 2022/23 of £2k and a £16k decrease in the transfer from the fund in 2023/24.   Amended Appendix 2a to the report set out the total movement between the officer proposals and the changes outlined above.  The table at paragraph 5.4 summarised the changes resulting in a proposed 2022/23 net budget of £21,816k and indicative 2023/24 net budget of £21,317k.  Paragraph 5.6 set out the proposed use of the £4.5m reserves that had been re-prioritised with a new proposal to set aside £100k to support events in the district, £2.8m for works to Studio 2 and £1.6m to support the Carbon Reduction Strategy. The Local Government Finance Settlement for 2022/23 had not yet been received and should further information be received in the next few days any significant changes would be tabled at Council.  The Head of Finance confirmed that the proposals put forward retained balanced budgets for 2022/23 and 2023/24.

RECOMMENDED (UNANIMOUSLY):

That    (1) the Draft Budget for 2022/23 of £21,816k and Indicative Budget for 2023/24 of £21,317k, as updated for further changes, are approved and recommended to  ...  view the full minutes text for item 86b

The Head of Housing and Property to submit a written report.

87/21 – HOUSING INVESTMENT PROGRAMME 2022/23: The Head of Housing and Property (HoHP) submitted a written report which reviewed the latest forecast for the 2021/22 Housing Investment Programme and sought approval for the 2022/23 outline programme.  The programme was directed at achieving a combination of Government targets and the Council’s own Housing Strategy and Housing Revenue Account Business Plan targets. As part of the programme of works to provide homes the Council was to receive a Land Release Fund grant and Rough Sleepers Accommodation Programme grant and approval for receipt of these grants was also sought.

Appendix 1 and the table at paragraph 5.2.1 showed the latest forecast expenditure for 2021/22 of £8,214k, this was £814k lower than the estimate previously reported in October. The decrease was predominantly due to a £1.2m reduction in planned maintenance, £0.6m for Allhallowgate and £0.3m for un-adopted roads.  These savings were offset by the inclusion of a £1.3m budget for five properties purchased for social rented housing. 

Section 5.3 of the report detailed the outline programme for 2022/23, allowing for expenditure of £16,478,290, and Appendix 2 provided a summary of the planned maintenance programme totalling £4.9m.  This included an upgrade of Avondale hostel and a pilot scheme to convert council homes to carbon neutral status.  Details of proposed housing developments were provided at paragraph 5.3.5, for which a budget of £2,690k had been included.  Approval was sought to bid for Homes England Grants to part fund up to 30% of these costs.  A Land Release fund grant had been received in relation to Holmefield Road, Church Close, Pannal Green and Woodfield Close, along with a Rough Sleepers Accommodation programme grant for Woodfield Close and this money could be used should a Homes England Grant bid not be successful. 

RECOMMENDED (UNANIMOUSLY):

That    (1) the outline Housing Investment Programme for 2022/23 be approved;

(2) authority to approve the detailed programme of planned maintenance, improvement and property acquisition schemes for 2022/23 be delegated to the Cabinet Member (Housing and Safer Communities);

(3) authority to approve subsequent variations to the programme referred to at 2.3 above be delegated to the Cabinet Member (Housing and Safer Communities) provided that such variations are within the scope of the Housing Investment Programme budget, and that such authority is only exercised upon receipt of a written report;

(4) following a successful bid to the Department for Levelling Up, Housing and Communities (DLUHC) in relation to the Rough Sleepers Accommodation Programme (RSAP) for £60k capital grant (and £26k revenue grant), receipt of this grant be approved;

(5) a bid to Homes England for up to 30% of total scheme costs relating to the new-build development programme to start on site in 2022/23 be approved; and

(6) authority to approve future bids for grant funding for the development and/or acquisition of affordable homes be delegated to Cabinet Member (Housing and Safer Communities) in consultation with the Head of Housing and Property and the Financial Services Manager.

(5.59 pm to 6.07 pm)

The Head of Finance to submit a written report.

88/21 – CAPITAL AND INVESTMENT PROGRAMME 2022/23 to 2026/27 AND

  2021/22 QUARTER 3 MONITORING: The Head of Finance submitted a written report which sought approval for the Capital and Investment Programme for 2022/23 and Indicative Programmes from 2023/24 to 2026/27 and provided the Quarter 3 monitoring for 2021/22.  The Council was taking a proactive approach to its asset management and ensuring that the return from investment was maximised and the Strategy assisted the Council in provision of corporate planning as schemes and funding for future years were approved.  Costs in the strategy were provisional high level estimates based on prices at the time and would vary as more detailed work was undertaken on projects.  A number of significant reviews would impact on the Capital and Investment Strategy in the future and these included the Sport and Leisure review, HCC Future Strategy and the Economic Growth Strategy. 

Section 7 of the report gave details of the updated Capital and Investment Programme for Quarter 3 2021/22.  Overall capital and revenue investment expenditure of £30,726k was forecast in 2021/22, a decrease of £597k from the previously approved programmes.  In addition Section 8 outlined the Capital Programme 2022/23 to 2026/27 with expenditure totalling £65,700k forecast over the five year rolling programme, an increase of £33,947k from the approved programmes. 

The Capital and Investment Strategy was part funded by the Council Investment Reserve (CIR) and as at 1 April 2021 funds totalling £16,501k were available to fund the Strategy.  The report set out a Draft Non-Housing Capital and Investment Programme for 2022/23 to 2026/27, with expenditure totalling £65,700k however there would be a funding shortfall of £207k in 2026/27. 

RECOMMENDED (UNANIMOUSLY):

That    (1) the latest forecast for 2021/22 be noted and the variations to Quarter 2 be approved; and

(2) the Draft Programme for 2022/23 and Indicative Programmes from 2023/24 to 2026/27 are approved, noting that future developments around the Sport and Leisure review, Harrogate Convention Centre (HCC) and Economic Growth will have an impact on the figures in this report.

(6.07 pm to 6.14 pm)

The Financial Services Manager to submit a written report.

89/21 – CAPITAL STRATEGY 2022/23: The Financial Services Manager submitted a written report which presented the Capital Strategy for 2022/23, which was attached at Appendix 1. The document had been produced in order to comply with the CIPFA Prudential Code for Capital Finance in Local Authorities which had been updated following a sharp upturn in local authorities making commercial investments to generate income to support revenue budgets.  Statutory Guidance on Local Government Investments published by the Ministry of Housing, Communities and Local Government required councils to agree an Investment Strategy with regard to both financial and non-financial assets and provide a framework for asset management.  

The Strategy set out the context in which capital expenditure and investment decisions were made and considered the risk and reward and impact on the achievement of priority outcomes.  This overarching document set out the framework for asset management at the Council together with the governance arrangements under which capital schemes and the associated funding within both the general fund and the housing revenue account were approved and monitored.  In assessing the affordability, prudence and sustainability of capital investment plans the Council was required to set a series of prudential indicators, and these included the Capital Financing Requirement, the level of capital expenditure not funded from Council resources to date, and this was set to decrease this year.

RECOMMENDED (UNANIMOUSLY):

That the Capital Strategy for 2022/23 at Appendix 1 is approved.

(6.14 pm to 6.22 pm)

The Head of Finance to submit a written report.

90/21 – TREASURY MANAGEMENT ANNUAL STRATEGY, ANNUAL

             INVESTMENT STRATEGY, PRUDENTIAL AND TREASURY

             INDICATORS, ANNUAL MINIMUM REVENUE PROVISION STATEMENT

             2022/23: The Financial Services Manager submitted a written report which gave details of four topics related to Treasury Management which it was necessary for the Cabinet to consider to comply with the Council’s financial regulations and the Chartered Institute of Public Finance and Accountability (CIPFA) Code of Practice.  The report had also been considered by the Audit and Governance Committee at its meeting held on 12 January 2022. 

RECOMMENDED (UNANIMOUSLY):

That    (1) the Treasury Management Annual Strategy is recommended to Council for approval (see Section 6 and Section 7);

(2) the Annual Investment Strategy is recommended to Council for approval (see Section 8);

(3) the Prudential and Treasury Indicators are recommended to Council for approval (see Section 9); and

(4) the Annual Minimum Revenue Provision Statement is recommended to Council for approval (see Section 6).

(6.22 pm to 6.27 pm)

The Director, Harrogate Convention Centre, and Director of Economy, Environment and Housing to submit a joint written report.

91/21 – HCC REDEVELOPMENT: STUDIO 2 ACCELERATED PACKAGE –

  FORWARD PLAN REF: 52HCC21: Further to Minute 70/21 the Director, Harrogate Convention Centre and Director of Economy, Environment and Housing submitted a joint written report in which approval was sought to progress the case for early investment in delivering the Studio 2 conference breakout spaces as part of the wider HCC Redevelopment Scheme.  The report also explored opportunities for additional income to be delivered earlier than originally anticipated following the Redevelopment.

At its meeting of 8 December 2021 Cabinet had recommended that the project approach to the redevelopment be amended and that a further report be brought to Cabinet for a decision as to whether work to Studio 2 should be accelerated as part of the Phase 1 refurbishment project, and this had been agreed by the Urgency Committee on 23 December 2021.

HCC contributed strongly to the economy of the district, attracting 150,000 visitors a year with an estimated economic impact of £35m.  Without investment HCC would decline, and the report set out that only by redevelopment could the venue fulfil its potential and provide the facilities required to secure future business.  The most transformational element of Phase 1 was the proposal to redevelop Studio 2 by the creation of large seminar / breakout rooms which would support a plenary session of 1,980 delegates in the main auditorium.  The report provided details of the sales activity undertaken so far on the new Studio 2 offer, bookings were now in the diary from April 2023 and exempt Appendix 1 provided details of the revenue and economic impact of these bookings. 

Section 6.2 of the report provided information on the financial implications of the proposed works, which could include a potential extra cost of £300k as a result of acceleration of the project. Exempt Appendix 2 showed an estimated forecast for revenue that could be generated from the Studio 2 rooms following completion and demonstrated that costs could be paid back in four years.  The Head of Finance had confirmed that the Council would have sufficient funds in the Council Investment Reserve to fund the initial outlay of £2.8m should the proposed review of reserves be approved as part of the 2022/23 budget process.  Section 6.3 provided further details of the procurement process and proposed timetable for the project, which could be achieved using the existing procurement framework.

RESOLVED (UNANIMOUSLY):

That    (1) the procurement process to accelerate the delivery of the Studio 2 package to enable its completion as an advanced element of the Phase 1 HCC Redevelopment by February 2023 be approved;

(2) circa £2.8m from the Council Investment Reserve is invested in Studio 2 as an advanced element of the funding for the HCC redevelopment scheme;

(3) a report be brought to Cabinet for a decision regarding whether to award a contract for the works on Studio 2 at the point when cost certainty is achieved for those particular works; and

(4) a further report be brought back to  ...  view the full minutes text for item 91.

The Head of Finance to submit a written report.

92/21 – 2021/22 JANUARY FINANCIAL & SERVICE PLAN PERFORMANCE

             UPDATE: The Head of Finance submitted a written report presenting the Council’s latest financial position along with a summary of service plan performance on an exception basis. The Council was currently reporting an underspend of £199k on General Fund activity.

The budget for 2021/22 included an estimated ongoing impact of the COVID-19 pandemic, which was expected to lessen as the year progressed and a net nil impact was now forecast rather than a cost.  As a result of the savings being made it was now proposed to set aside £600k of savings to fund the potential costs of local government reorganisation.

The key variances that made up the forecast were shown in Table 1 at paragraph 5.4 of the report. Table 2 at paragraph 5.5 summarised the service by service variances, including variance attributed to COVID-19.  Table 3 at paragraph 5.6 showed how each Council service was performing from Quarter 2 to Quarter 3.  Paragraph 5.8 provided reasons for each service for the £199k underspend.  Detailed profit and loss accounts for Green Waste, Trade Waste and the Plant Nursery were attached at exempt Appendices B to D.  Exempt Appendices A and E detailed an underspend relating to the Harrogate Convention Centre.  Appendix F showed how the variances related to budgeted savings and increased income.

The report had also been considered by the Overview and Scrutiny Commission at its meeting held on 31 January 2022.  The Leader invited the Chair of the Commission, Councillor Chris Aldred, to speak on the item.  Councillor Aldred congratulated officers on the level of underspend and commented on the success of Bracewell Homes, which was returning a substantial profit.  The Leader thanked the Commission for its comments.

RESOLVED (UNANIMOUSLY):

That    (1) the Council’s current financial position, a forecast underspend of £199k, and service plan exception reporting, is noted; and

(2) the provision of £600k to fund potential implementation costs of Local Government Reorganisation, as supported by Management Board but subject to approval by Members as part of the final accounts process, is noted.

Reasons for decision:

It was good financial discipline that regular reporting was presented to Management and Members so as to ensure expenditure remained within budget, that potential underspends were highlighted and areas that were off target were highlighted and mitigating actions could be identified.

Alternative options considered and recommended for rejection:

Not to receive financial reporting which would weaken financial control, increase the risk of overspends against budget or missed opportunities to utilise underspends or identify mitigating actions.

(3.39 pm to 3.43 pm)

 (D)

The Improvement and Development Manager to submit a written report.

93/21 – CORPORATE PERFORMANCE REPORT, Q3 2021/22: The Improvement and Development Manager submitted a written report which provided an update on the measures within the Corporate Delivery Plan at Quarter Three.  Appendix 1 to the report provided the Quarter 3 outturn of the measures within the Corporate Delivery Plan and Appendix 2 contained the Corporate Health report which detailed progress against the various performance indicators.  The report had previously been received by Management Board, whose comments were incorporated into the report at section 8. 

The Overview and Scrutiny Commission had also considered the report at its meeting held on 31 January 2022.  The Leader invited the Chair of the Commission, Councillor Chris Aldred, to speak on the item.  Councillor Aldred reported that the Commission had concurred with the comments of Management Board and requested that the Commission be involved in the prioritisation exercise setting out the top 50 priorities for the final year of Harrogate Borough Council.  The Leader thanked the Commission for its comments.

RESOLVED (UNANIMOUSLY):

That the report be received, and the comments from the Overview and Scrutiny Commission and Management Board were considered and noted.

Reasons for decision:

Our Corporate Plan set out our long-term vision for the Harrogate district, our aim as an organisation, our corporate priorities and the long term outcomes that we wanted to achieve. The Delivery Plan was updated on an annual basis and detailed what we would do, what our targets were and how we would measure these. This report tracked our progress against the Delivery Plan.

Alternative options considered and recommended for rejection:

No alternative options were considered as reporting progress on the Council’s Corporate Delivery Plan performance was a key part of the Council’s performance management arrangements.

(5.51 pm to 5.59 pm)

 (D)

The Compliance Officer to submit a written report.

94/21 – ENFORCEMENT POLICY IN RELATION TO THE MINIMUM ENERGY

             EFFICIENCY STANDARDS IN PRIVATELY RENTED DOMESTIC

             PROPERTIES: The Compliance Officer, Housing and Property, submitted a written report which sought approval for the implementation and enforcement of the Domestic Private Rented Energy Performance Certificates (EPCs) and the Energy Efficiency (Private rented property)(England and Wales) Regulations 2015 (as amended).  Attached at Appendix C was a draft Enforcement Policy in relation to the Minimum Energy Efficiency Standards (MEES) Regulations 2015, which Cabinet was requested to approve.

Under the Regulations private landlords must not grant a new tenancy, or renew, or extend an existing tenancy agreement to let domestic properties with an EPC rating of F or G as such properties were defined as sub-standard and non-compliant.  As the enforcement authority for the district the Council was responsible for enforcing compliance.  The Private Sector Renewal team had recently been awarded grant funding to employ a temporary Compliance Officer to carry out pro-active work to improve the EPCs of private rented domestic properties and approximately 300 such properties had been identified.  Appendix A set out a flowchart on how the provisions would be implemented, and Appendix B provided a flowchart on the process for compliance and enforcement. The draft policy at Appendix C detailed the process for issuing a penalty notice where landlords failed to make energy efficiency improvements. 

Improving the energy efficiency of the district’s most poorly insulated and inefficient privately rented domestic properties would help reduce energy costs for tenants, and reduce maintenance costs and improve the condition of properties. The implementation of these Regulations would also help reduce greenhouse gas and carbon emissions and drive up housing standards in the private rented sector, which would have a positive impact on residents and communities.

RESOLVED (UNANIMOUSLY):

That    (1) the powers and duties of the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015, as amended, be delegated to the Director of Economy, Environment and Housing, and that the enforcement of the Minimum Energy Efficiency Standards is to be undertaken by Officers in the Housing and Property, Private Sector Renewal Team, enabling them to serve compliance notices, impose financial penalties and serve publication penalties under the Regulations; and

(2) the draft policy in relation to the Regulations: ‘Enforcement Policy in relation to the Minimum Energy Efficiency Standards (MEES) Regulations 2015 (as amended)’ at Appendix C is approved.

Reasons for decision:

Since 1st April 2018, landlords must not grant a new tenancy, or renew, or extend an existing tenancy agreement to let EPC F or G rated domestic properties under the Regulations. Therefore any properties let to private tenants with an EPC rating of F or G will be defined as sub-standard and non-compliant with the Regulations, unless there was a valid registered exemption or the property does not require an EPC. The Council was the enforcement authority for this district and is responsible for enforcing compliance. At present there is no policy in place for the Council to enforce these provisions. The Regulations  ...  view the full minutes text for item 94.