Agenda and minutes

Apologies for absence were received from Councillors Joshi, Khote, Waddington and Westley.

Councillor March was present as the appointed substitute for Councillor Joshi and Councillor Govind was present as the appointed substitute for Councillor Khote.  Councillor Sandhu was appointed as substitute for Councillor Waddington, but submitted apologies for absence.

Members are asked to declare any interests they may have in the business to be discussed.

Councillor Halford declared a Disclosable Pecuniary Interest in agenda item 11, “Housing Revenue Account Budget (Including Capital Programme) 2020/21”, in that she was a Council tenant.  Councillor Halford remained in the meeting during consideration of this item, but took no part in the discussion or voting thereon.

The minutes of the meeting of the Overview Select Committee held on 28 November 2019 are attached and Members are asked to confirm them as a correct record.

AGREED:

That the minutes of the meeting of the Overview Select Committee held on 28 November 2019 be confirmed as a correct record.

To note progress on actions agreed at the previous meeting and not reported elsewhere on the agenda (if any).

a)    Minute 47(c), “Questions for the City Mayor – ‘Lying Figure No. 1’ Painting”

It was queried whether the recently announced improvement works and changes to security at New Walk Museum and Art Gallery had been as a result of the question asked at the meeting of this Committee held on 28 November 2019 about the “Lying Figure No. 1” painting and whether that question had prompted an increase in visitor numbers..  It also was asked what the picture was insured for and whether this was an accurate reflection of its value, as an international auction house had contacted a member of the Committee and offered to undertake a valuation.

In reply, the City Mayor explained that the Council’s art collection was valued in its entirety on a regular basis, with each piece being insured separately.  However, he did not consider it appropriate to disclose the value for an individual piece in public.  He also noted that security arrangements were audited regularly by an independent assessor, whose recommendations were acted on.  The last audit had been approximately 2 – 3 years ago and work arising from this had already been completed, or was in progress.

The City Mayor noted that it was impossible to know the reason why every visitor had gone to the Museum and Art Gallery, so was unable to say whether the question asked at the last meeting had prompted an increase in visitor numbers.

b)   Minute 52(c), “Scrutiny Commissions’ Work Programmes – The underachievement of ‘Black Caribbean’ and ‘White British Working-Class’ pupils of secondary school age in Leicester”

Councillor Dawood advised the Committee that the report discussed under this minute had now been presented to the Executive and the way forward was being discussed.

The City Mayor advised Members that he had undertaken to give the Chair and Vice-Chair of the Children, Young People and Schools Scrutiny Commission a full response to the report, which he would share with this Committee.

The Chair reminded Members that the next meeting of the Committee would be held at 5.30 pm on Thursday 26 March 2020, (not 5 March as previously scheduled).

A briefing for all members of the Committee on Equality Impact Assessments would now be held 5.30 – 6.30 pm on Thursday 5 March 2020.

The Monitoring Officer to report on the receipt of any questions, representations and statements of case submitted in accordance with the Council’s procedures.

The Monitoring Officer reported that no questions, representations or statements of case had been received.

The Monitoring Officer to report on any petitions received.

The Monitoring Officer advised that there were no petitions to report.

The Monitoring Officer submits a report that updates Members on the monitoring of outstanding petitions. The Committee is asked to note the current outstanding petitions and agree to remove those petitions marked ‘Petitions Process Complete’ from the report.

The Monitoring Officer submitted a report updating Members on the monitoring of outstanding petitions.

AGREED:

That the petitions marked ‘petition complete’, namely 19/6/01, 19/7/02, 19/7/03, 19/8/01, 19/8/02, 19/9/01, 19/9/03 and 19/9/04 be removed from the Monitoring Report.

The City Mayor will answer questions raised by members of the Overview Select Committee on issues not covered elsewhere on the agenda.

The following questions were put to the City Mayor at the meeting.

a)     Vehicle Parking and Waiting Area Outside the Train Station

Councillor Porter noted that taxis currently were able to park outside the train station, as the Council had received advice that they could pull in to pick up and drop off passengers, and asked the City Mayor what his view of this was.

The City Mayor stated that he felt that the area past the station needed to be part of a comprehensive Red Route.  This would remove differences in opinion about whether parking or waiting outside the station was permissible, as under a Red Route no-one could stop.  Discussions about introducing a Red Route were being held, but in the meantime officers continued to enforce the Traffic Regulation Orders currently in force for that area.

b)     Border House

Councillor Porter noted that Border House was owned by the Council, but the staff, who were employed by the Council, had been told that it would close, as it was not fit for purpose and funding was not available to improve it.  However, asylum seekers were being housed there, which was a concern if the building was not fit for purpose.

At the invitation of the Chair of the Committee and the City Mayor, the Director of Housing addressed the points made, explaining that Border House remained a hostel for families, as there had been no change in its use.  There were no asylum seekers there.

There had been a proposal that Border House would close eventually, as the Council moved to a “Homes for the Homeless” approach, as this would remove the need for a hostel.  The policy also would mean that there was more likelihood that homeless people could stay in their preferred area.

The Director of Estates and Building Services submits a report informing Members of draft proposals for the city’s response to the climate emergency, as well as the associated programme of community consultation and engagement entitled “Leicester’s Climate Emergency Conversation”.  (Attached at Appendices C and C1)

This report has been considered by the following Scrutiny Commissions and minute extracts are attached:

·           Economic Development, Transport and Tourism Scrutiny Commission – 4 December 2019 (Appendix C2)

·           Housing Scrutiny Commission – 13 January 2020 (Appendix C3)

This Committee is recommended to consider the report and the comments made by the Scrutiny Commissions, and to:

a)     note the progress made since the climate emergency declaration, including the consultation and engagement programme recently completed;

b)     note the involvement of the Economic Development, Transport and Tourism Scrutiny Commission and the Housing Scrutiny Commission;

c)     comment on the proposals in Appendix 1, including their implications for the city and for the council; and

d)     note the next steps for the development and adoption of a Council action plan to address the climate emergency.

The Director of Estates and Building Services submitted a report informing Members of draft proposals for the city’s response to the climate emergency, as well as the associated programme of community consultation and engagement entitled “Leicester’s Climate Emergency Conversation”.

Councillor Clarke (Deputy City Mayor with responsibility for Environment and Transportation) introduced the report, noting that the consultation period had ended on 9 February 2020.  Over 1,000 responses had been received, which were currently being considered.

The Corporate Environmental Consultant further explained that consultation on the proposals had started in November 2019, in order to get a public reaction to changes likely to be needed in Leicester in response to the declared climate emergency.

By the end of the consultation period, 374 on-line questionnaires had been completed and many letters received from individuals and groups, which was felt to be a very good response.  Efforts also had been made to reach out in other ways, such as face-to-face consultation, holding a Climate Assembly attended by 53 people representing a cross-section of Leicester’s community, holding a Young People’s Climate Assembly attended by 104 students representing 12 secondary schools, and speaking to key organisations across the city. 

During the consultation, the Council’s Economic Development, Transport and Tourism Scrutiny Commission asked that consideration be given to how primary school age children could be included as consultees in the Conversation.  In response to this, a pack of information had been circulated through the Council’s extra-net.  This had resulted in over 200 primary school students from eight primary schools participating in the Conversation.

In addition, to this work, a Climate Emergency pack had been prepared for schools that they could use to declare their own climate emergency.

The Committee welcomed the range of consultation methods used and expressed the hope that the diversity of tools used would generate responses from a diverse range of people.  In reply, the Corporate Environmental Consultant explained that not all of the consultation methods used produced demographic information, although it would be gathered from responses to the on-line questionnaire and attendees at the Climate Assembly events.

The following comments also were made in discussion on this:

·           It had been asserted that reducing consumption of meat and dairy products could reduce gases harmful to the climate.  What could be done to encourage this?

Response from the Corporate Environmental Consultant:

An action plan was being prepared, so no proposals had been made yet.  However, there would be an emphasis on awareness raising, as it was not intended to impose actions on people.  Care also would be taken to co-ordinate with any recommendations about diet with messages from public health services.

·           Planting trees could help tackle global warming and reduce carbon dioxide.  The report suggested that there could be a lot of trees planted in the city, so would there be a scheme to encourage people to plant trees, for example with the Council buying trees in bulk that people could plant in their own gardens?

Response from Councillor Clarke:

This purpose of this  ...  view the full minutes text for item 64.

The Director of Housing submits a report setting out the proposed Housing Revenue Account (HRA) budget for 2020/21, with indicative budgets for the following two years.

The Committee is recommended to:

a)     Note the financial pressures on the HRA and comment on the proposals for delivering a balanced budget;

b)     Note the comments from the Tenants’ and Leaseholders’ Forum and the Housing Scrutiny Commission; and

c)     Comment on the proposed changes to rent and service charges for 2020/21.

The Director of Housing submitted a report setting out the proposed Housing Revenue Account (HRA) budget for 2020/21, with indicative budgets for the following three years. 

The Director introduced the report, explaining that, following a four-year period in which the government required rents to be reduced by 1% each year, the government had announced that for five years from 2020 rents could be increased by up to an amount equivalent to the Consumer Price Index plus 1%.  This was welcomed, as the reductions had resulted in a £3million loss in rent for the Council.  Overall budget pressures had exceeded £12million.  Ongoing financial pressures remained, with the HRA facing a further £11million in budget pressures over the next three years.  To manage this and deliver a balanced budget it was a recommendation that rents should be increased.

This proposal had been considered by the Tenants’ and Leaseholders’ Forum, as well as the Housing Scrutiny Commission.  Comments from both bodies were included in the report.  The Director drew Members’ attention to the Housing Scrutiny Commission’s support for the Tenants’ and Leaseholders’ Forum’s proposal that rents should increase by 2.5% (not the proposed 2.7%), service charges should increase by 1.7% (not the proposed 2.0%) and hostel rents should not be increased (instead of applying the proposed 2.0% increase).

The Director of Housing explained that this would reduce income by £180,000 per year.  The cap placed on rent increases by the government meant that this money could not be recovered in future years, so over ten years the Council would lose £1.8million that could have been used for investment in improvements to its housing stock and estates and to provide services.  Therefore, although this could have had resulted in a small reduction in rent, (on average 14p per week), it would have a significant impact on the Council’s HRA budget.

The City Mayor reiterated that the original budget proposal was the start of the process of addressing the problems caused by the previous enforced reduction in rent.  The changes proposed were small increases for the people affected, but were significant for the Council’s resources.  He therefore strongly recommended that the increases included in the original proposal be supported.

Some concern was expressed that the increases in rent and service charges proposed by the Council could have a significant impact on tenants, particularly those already experiencing financial difficulties.  The Director of Housing explained that approximately 60% of housing tenants and over 90% of people in Council hostels had their rent paid through Housing Benefit, which would cover any increase in rent.  Also, a problem with the proposal made by the Tenants’ and Leaseholders’ Forum was that although the Forum wished to see a lower increase in rents and service charges, there was no balancing adjustment proposed to work to be carried out using income from those rents and charges.  The Forum agreed that all of the proposed investment in the HRA budget was needed.  The Director reminded the Committee that the Council was legally obliged  ...  view the full minutes text for item 65.

The Director of Finance submits the draft General Fund Revenue Budget 2020/21 to 2021/22, which will be considered at the meeting of Council on 19 February 2020, (attached at Appendix E).

The following draft minute extracts, detailing the respective Scrutiny Commissions’ discussions on the draft General Fund Revenue Budget report, will be circulated as soon as they are available:

·           Neighbourhood Services Scrutiny Commission – 15 January 2020 (Appendix E1)

·           Heritage, Culture, Leisure and Sport Scrutiny Commission – 21 January 2020 (Appendix E2)

·           Children, Young People and Schools Scrutiny Commission – 28 January 2020 (Appendix E3)

·           Health and Wellbeing Scrutiny Commission – 30 January 2020 (Appendix E4)

·           Adult Social Care Scrutiny Commission – 4 February 2020 (Appendix E5)

·           Economic Development, Transport and Tourism Scrutiny Commission – 5 February 2020 (Appendix E6)

This Committee is recommended to consider the draft budget and the comments made by the Scrutiny Commissions, and to pass its comments on these to the meeting of Council on 19 February for consideration.

The Director of Finance submitted the draft General Fund Revenue Budget 2020/21 to 2021/22, which would be considered at the meeting of Council on 19 February 2020. 

Members were reminded that draft minute extracts, detailing Scrutiny Commissions’ discussions on the draft General Fund Revenue Budget report, had been circulated separately.  The City Mayor advised the Committee that he had considered the comments made by the Scrutiny Commissions and would be drafting a response to be presented at the Budget Council meeting on 19 February 2020.

The Director of Finance introduced the report, explaining that the Council had approved a one-year budget for 2019/20, as it had been expected that the system of local government funding would change during that period.  However, due to other national political priorities during the year, this review had been deferred and would be implemented from 2021/22 at the earliest.  Consequently, it was being proposed that a one-year budget be agreed for 2020/21.

The Director reminded Members that the Council had adopted a managed reserves strategy for a number of years.  Under this, money had been put in to reserves where possible, to enable structured and planned spending decisions to be taken.  The programme of spending reviews adopted over the last few years also had been beneficial, as it meant that the funding gap in the proposed budget was manageable. This programme of reviews needed to continue though.

It was noted that approximately 65% of the Council’s expenditure was on adult and children’s social care.  In recognition of the increasing demands and pressures on these services, the draft General Fund revenue budget included growth in both areas.  An additional £17million was being made available, this being £3million for adult social care and £14million for children’s social care, due to the increasing number and complexity of cases.  These figures were based on trends and predictions for service demands. 

Members were advised that there had been an underspend on adult social care during 2018/19, due to the early completion of a spending review.  As a result, a phased saving had been delivered earlier than anticipated.

The final 2020/21 local government finance settlement had only been announced by the government on 7 February 2020.  This had been slightly more favourable than anticipated, so the Council’s funding gap for 2020/21 was now £2.4million, rather than the £5.6million set out in the draft budget report. 

However, due to other urgent parliamentary business, the local government finance settlement had not been laid before parliament on 12 February as planned and now would be debated after the parliamentary recess.  Consequently, all local authorities would have to agree their budgets for 2020/21 before parliamentary approval of the settlement had been obtained.  It therefore was possible that aspects of the budget could need to be reconsidered by Council if the settlement changed significantly from that proposed, although this was highly unlikely.

The Committee noted the discussion that had been held at the Economic Development, Transport and Tourism Scrutiny Commission regarding the impact that the proposed  ...  view the full minutes text for item 66.

The Director of Finance submits the draft Capital Programme 2020/21, which will be considered at the meeting of Council on 19 February 2020.  The Committee is recommended to consider the draft Capital Programme and pass its comments on it to the meeting of Council on 19 February for consideration.

The Director of Finance submitted the draft Capital Programme 2020/21, which would be considered at the meeting of Council on 19 February 2020.

While introducing the report, the Director explained that the capital programme previously had been agreed for two years, as it had been expected that the system of local government funding would change during that period.  However, due to other national political priorities, this review had been deferred and would be implemented from 2021/22 at the earliest.  Consequently, it was proposed that a one-year capital programme be agreed for 2020/21, although it was recognised that some schemes would run beyond that period.

In response to a Member query, the City Mayor confirmed that the provision for the Reuse Shop at the Gypsum Close Household Waste Recycling site was to finance an expansion of the shop.  This was proposed due to the success of the shop, as it could no longer store all of the items for sale within its premises.

In reply to a further Member enquiry, the Director of Finance explained that the Touchdown project was a pilot workspace project.  Council-managed buildings outside of the city centre were being assessed to identify where space was available that could be used by Council staff working in a mobile way.  For example, staff undertaking visits to various locations could use Touchdown space for a short time between visits.  This could include locations such as office space above libraries, or at sports centres, which would avoid staff having to travel in and out of the city centre so often.

The Committee noted that the largest project in the capital programme appeared to be the work to the Jewry Wall Museum.  It therefore requested that a report on the project be submitted to the Overview Select Committee, to enable it to gain a full picture of what was being planned.  The City Mayor advised the Committee that he would welcome its input on this major initiative.

AGREED:

1)    That, in view of the scale of the investment being made in to the project, the Director of Tourism, Culture and Inward Investment be asked to submit a report to the Overview Select Committee on the work to the Jewry Wall Museum, to enable the Committee to gain an overview of this project and provide input as appropriate;

2)    That this Committee supports the recommendations set out in the report in relation to the Capital Programme 2020/21.

Councillor Porter left the meeting during consideration of this item

The Director of Finance submits a report proposing a framework for the governance of the Council’s borrowing and investments.  The Committee is recommended to note the report and make any comments to the Director of Finance as wished, prior to Council consideration.

The Committee considered this item and the following two items simultaneously.  (Minute 69, “Treasury Management Strategy 2020-21”, and minute 70, “Investment Strategy 2020/21”, refer.)

The Director of Finance gave a presentation on Investment Strategies, a copy of which is attached at the end of these minutes for information.  During the presentation, particular attention was drawn to the following points:

·           The Council’s Treasury Policy set out the framework for the governance of the Council’s borrowing and investments.  The Treasury Management Strategy described how this would be done and the Investment Strategy set out the Council’s approach to making and holding investments that were not made for normal treasury management purposes;

·           Security of the Council’s money was paramount;

·           Penalty charges were incurred on debts repaid early, so it usually cost less to maintain a debt than to repay it.  Nonetheless, money still had to be set aside in the budget to repay debt;

·           The Council often had money before it needed to spend it.  For example, staff salaries were paid at the end of the month and reserves were maintained.  This meant that balances could fluctuate considerably day by day;

·           The safer an investment was, the lower the return on it;

·           Specialist advisers were used to help with investments, to make sure these investments were robust;

·           As the Council’s balances continued to grow, efforts continued to find the best ways to make this money work for the city;

·           Currently, a better rate of return was received from lending to other local authorities than from bank interest;

·           Along with a number of other local authorities, the Council was actively exploring environmentally and socially responsible investment;

·           Some local authorities had bought commercial investments located a long way outside of their area and were borrowing very large amounts.  This could create a high level of risk and raised questions of how assets managed at long distances could be transparent investments;

·           This Council had invested in property in the city for many years.  This currently generated approximately £6million income per year to support the Council’s budget; and

·           There was regular churn on the corporate estate, with properties being bought and sold as necessary.

The City Mayor reiterated the importance of the corporate estate to the city and the Council, and advised the Committee that discussions were being held with officers about how the performance of the estate could be made more transparent.  One option was to present an annual report that included information such as what the Council held, income from this, expenditure and surpluses.  It was hoped that the first such report could be presented to Council in the summer of 2020

In response to a Member’s query, the Director of Finance explained that the Council did not invest in property abroad, as due diligence was very hard there.  Some years previously, the Council had lent money directly to European banks, but since the collapse of the Icelandic Banks had ceased to do so, even though this Council had not invested in Iceland.

AGREED:

1)  ...  view the full minutes text for item 68.

The Director of Finance submits a report proposing a strategy for managing the Council’s borrowing and cash balances during 2020/21 and for the remainder of 2019/20.  The Committee is recommended to note the report and make any comments to the Director of Finance as wished, prior to Council consideration.

The Committee considered this item plus the previous and following items simultaneously.  (Minute 68, “Treasury Policy”, and minute 70, “Investment Strategy 2020/21”, refer.)

The Director of Finance gave a presentation on Investment Strategies, a copy of which is attached at the end of these minutes for information.  During the presentation, particular attention was drawn to the following points:

·           The Council’s Treasury Policy set out the framework for the governance of the Council’s borrowing and investments.  The Treasury Management Strategy described how this would be done and the Investment Strategy set out the Council’s approach to making and holding investments that were not made for normal treasury management purposes;

·           Security of the Council’s money was paramount;

·           Penalty charges were incurred on debts repaid early, so it usually cost less to maintain a debt than to repay it.  Nonetheless, money still had to be set aside in the budget to repay debt;

·           The Council often had money before it needed to spend it.  For example, staff salaries were paid at the end of the month and reserves were maintained.  This meant that balances could fluctuate considerably day by day;

·           The safer an investment was, the lower the return on it;

·           Specialist advisers were used to help with investments, to make sure these investments were robust;

·           As the Council’s balances continued to grow, efforts continued to find the best ways to make this money work for the city;

·           Currently, a better rate of return was received from lending to other local authorities than from bank interest;

·           Along with a number of other local authorities, the Council was actively exploring environmentally and socially responsible investment;

·           Some local authorities had bought commercial investments located a long way outside of their area and were borrowing very large amounts.  This could create a high level of risk and raised questions of how assets managed at long distances could be transparent investments;

·           This Council had invested in property in the city for many years.  This currently generated approximately £6million income per year to support the Council’s budget; and

·           There was regular churn on the corporate estate, with properties being bought and sold as necessary.

The City Mayor reiterated the importance of the corporate estate to the city and the Council, and advised the Committee that discussions were being held with officers about how the performance of the estate could be made more transparent.  One option was to present an annual report that included information such as what the Council held, income from this, expenditure and surpluses.  It was hoped that the first such report could be presented to Council in the summer of 2020

In response to a Member’s query, the Director of Finance explained that the Council did not invest in property abroad, as due diligence was very hard there.  Some years previously, the Council had lent money directly to European banks, but since the collapse of the Icelandic Banks had ceased to do so, even though this Council had not invested in Iceland.

AGREED:

1)    That  ...  view the full minutes text for item 69.

The Director of Finance submits a report defining the Council’s approach to making and holding investments, other than those made for normal treasury management purposes.  The Committee is recommended to note the report and make any comments to the Director of Finance as wished, prior to Council consideration.

The Committee considered this item plus the previous two items simultaneously.  (Minute 68, “Treasury Policy”, and minute 69, “Treasury Management Strategy 2020-21”, refer.)

The Director of Finance gave a presentation on Investment Strategies, a copy of which is attached at the end of these minutes for information.  During the presentation, particular attention was drawn to the following points:

·           The Council’s Treasury Policy set out the framework for the governance of the Council’s borrowing and investments.  The Treasury Management Strategy described how this would be done and the Investment Strategy set out the Council’s approach to making and holding investments that were not made for normal treasury management purposes;

·           Security of the Council’s money was paramount;

·           Penalty charges were incurred on debts repaid early, so it usually cost less to maintain a debt than to repay it.  Nonetheless, money still had to be set aside in the budget to repay debt;

·           The Council often had money before it needed to spend it.  For example, staff salaries were paid at the end of the month and reserves were maintained.  This meant that balances could fluctuate considerably day by day;

·           The safer an investment was, the lower the return on it;

·           Specialist advisers were used to help with investments, to make sure these investments were robust;

·           As the Council’s balances continued to grow, efforts continued to find the best ways to make this money work for the city;

·           Currently, a better rate of return was received from lending to other local authorities than from bank interest;

·           Along with a number of other local authorities, the Council was actively exploring environmentally and socially responsible investment;

·           Some local authorities had bought commercial investments located a long way outside of their area and were borrowing very large amounts.  This could create a high level of risk and raised questions of how assets managed at long distances could be transparent investments;

·           This Council had invested in property in the city for many years.  This currently generated approximately £6million income per year to support the Council’s budget; and

·           There was regular churn on the corporate estate, with properties being bought and sold as necessary.

The City Mayor reiterated the importance of the corporate estate to the city and the Council, and advised the Committee that discussions were being held with officers about how the performance of the estate could be made more transparent.  One option was to present an annual report that included information such as what the Council held, income from this, expenditure and surpluses.  It was hoped that the first such report could be presented to Council in the summer of 2020

In response to a Member’s query, the Director of Finance explained that the Council did not invest in property abroad, as due diligence was very hard there.  Some years previously, the Council had lent money directly to European banks, but since the collapse of the Icelandic Banks had ceased to do so, even though this Council had not invested in Iceland.

AGREED:

1)    That  ...  view the full minutes text for item 70.

The current work programme for the Committee is attached.  The Committee is asked to consider this and make comments and/or amendments as it considers necessary.

AGREED:

That the Committee’s work programme be received and noted.

The meeting closed at 7.35 pm