Financial Reporting 2018/19 - Quarter 2

Reference code: 
PCD 503
Date signed: 
05 December 2018
Authorisation name: 
Sophie Linden, Deputy Mayor, Policing and Crime

Executive summary

The DMPC is asked to note the current year to date financial position, the quarter 2 2018/19 forecast position and to approve a number of budget and reserve movements.  In summary, there is a full year forecast underspend of £19.8m. The forecast underspend consists of a £39.9m underspend related to Total Pay and Overtime, £25.0m Running Costs overspend, £4.8m against other expenditure and £9.8 overachievement of Total Income. 

Officer pay has been reported with a forecast underspend of £26.0m at quarter 2, with a £21.0m overspend against officer pay overtime This leaves a net underspend of £5m against officer related pay. 

We recommend that DMPC approves at quarter 2, the reserve transfers, application of grants and income and housekeeping budgetary changes are listed in paragraph 2.4 and detailed in Appendix 1.

Following detailed review of programme requirements, capital expenditure has been reprofiled to £249.2m, against the previously approved budget of £363.7m. The DMPC is requested to approve the reprofiling of the capital budget as per paragraph 2.5.

The paper also seeks approval for the publication of the Quarterly Performance Update Report- attached as Appendix 2. 

Recommendation

The DMPC is asked to 

  • Note the 2018/19 revenue and capital financial position and forecast.
  • Approve the budget movements and transfer to reserves set out in paragraph 2.4-2.5.
  • Approve the publication of the 2018/19 Quarterly Performance Report (Quarter 2)

Non-confidential facts and advice to the Deputy Mayor for Policing and Crime (DMPC)

1.    Introduction and background

1.1.    As part of MOPAC’s and MPS corporate governance arrangements regular monthly and in-depth quarterly monitoring processes are in place to track spend against budget, forecast outturn and monitor the achievement of planned savings and income targets.  

1.2.    In line with the Scheme of Delegation and Consent the DMPC is responsible for the approval of all MPS proposed budget movements and virements in excess of £500,000 which are highlighted on a monthly basis as part of the monthly budget monitoring report, and approval of all transfers to and from reserves.

2.    Issues for consideration

Revenue 

2.1.    The forecast year end revenue position is a reported underspend of £19.8m. 

2.2.    Further detail of forecast under and overspends is set out in Appendix 2 from pages 42-55.

Capital 

2.3.    Capital investment is forecast to be £249.2m in 2018/19 against an approved budget of £363.7m.  Further detail of variances is set out in Appendix 1. The DMPC is requested to approve the reprofiling of capital budgets in 2018/19 by £114.5m, as set out in Appendix 1 (Page 47)

Budget Movements 

2.4.    Budget movements are set out in Appendix 1;
The DMPC is requested to approve;
Reserve movements as follows-

  • Transfers into reserves;
    • £4.0m of Property Service Department reserves due to delays in exiting buildings in 2018/19
    • £4.7m Fleet Services following decision not to proceed with current outsourcing proposals. 
    • £0.6m adjustment to Early Departures reserve funding in 2018/19
    • £0.2m catering re-profiling of transition budget between financial years
    • £8.1 correction of budget build in Centrally Held
  • Transfers out of reserves 
    • £4.1m application of Major Change reserve funding 
  • Approve the application of grants and income, the corresponding increase in the expenditure budget, and housekeeping budgetary changes to re-align budgets to forecast spend with a net nil increase in the budget

2.5.    Capital budget movements are set out in Appendix 2, and in summary the DMPC is requested to approve the following re-profiles; 

  • Property Services - from £214.2m to £99.9m 
  • Fleet Services - from £29.2m to £28.0m.
  • NCTPHQ -  from £30m to £34.1m
  • Digital Policing - from £18m to £30.2m
  • One Met Model- from £72.3m to £66.8m.
  • Over-programming- from £0m to -£10m. 

3.    Financial Comments

3.1.    As this is a financial report the financial implications are contained within the body of the report.

4.    Legal Comments

4.1.    Under section 3 (6) of the Police Reform and Social Responsibility Act, MOPAC is under a duty to secure the maintenance of an efficient and effective police force. Under paragraph 7 of schedule 3 of the 2011 Act MOPAC may do anything which is calculated to facilitate, or is conductive or incidental to, the exercise of its functions. Under section 79 of the Act, MOPAC must have regard to the Policing Protocol when exercising its functions. The Policing Protocol provides that PCCs (including MOPAC) as recipient of all funding, must determine how this money is spent. 

4.2.    MOPAC/MPS as statutory bodies must only budget for activities that fall within its statutory powers. Under the Scheme of Delegation and Consent the DMPC must approve any budget movement for £500,000 or above.  Under Financial Regulations all decisions in relation to the transfer in and out of reserves will be made by the DMPC.

5.    GDPR and Data Privacy 

5.1.    The project does not use personally identifiable data of members of the public therefore there are no GDPR issues to be considered.

6.    Equality Comments

6.1.    There are no equality or diversity implications arising from this report.

7.    Background/supporting papers

Appendix 1 – Budget Transfers
Appendix 2 – Quarterly Performance Update Report – Quarter 2 2018/19


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