Interactive webcast player

Finance and Performance Scrutiny Sub-Committee
Tuesday, 29th September 2026 at 6:00pm

 

Welcome to Folkestone and Hythe District Council's Webcast Player.

 

UPDATE - PLEASE NOTE, MEETINGS OF THE JOINT TRANSPORTATION BOARD AND FOLKESTONE AND HYTHE DISTRICT AND PARISH COUNCILS' JOINT COMMITTEE WILL BE STREAMED LIVE TO YOUTUBE AT: bit.ly/YouTubeMeetings. 


The webcast should start automatically for you, and you can jump to specific points of interest within the meeting by selecting the agenda point or the speaker that you are interested in, simply by clicking the tabs above this message. You can also view any presentations used in the meeting by clicking the presentations tab. We hope you find the webcast interesting and informative.

 

Please note, although officers can be heard when they are speaking at meetings, they will not be filmed.

 

At the conclusion of a meeting, the webcast can take time to 'archive'.  You will not be able to view the webcast until the archiving process is complete.  This is usually within 24 hours of the meeting.

Share this agenda point
  1. Cllr Alan Martin
  2. Mr Jake Hamilton
  3. Cllr Alan Martin
Share this agenda point
Share this agenda point
Share this agenda point
  1. Gavin Edwards
  2. Cllr Alan Martin
  3. Cllr Paul Thomas
  4. Gavin Edwards
  5. Cllr Paul Thomas
  6. Cllr Alan Martin
  7. Gavin Edwards
  8. Cllr Alan Martin
  9. Cllr Tim Prater
  10. Cllr Alan Martin
  11. Gavin Edwards
  12. Cllr Alan Martin
  13. Cllr Tim Prater
  14. Cllr Alan Martin
  15. Cllr Elaine Martin
  16. Gavin Edwards
  17. Cllr Alan Martin
  18. Cllr Paul Thomas
  19. Cllr Alan Martin
  20. Gavin Edwards
  21. Cllr Alan Martin
Share this agenda point
  1. Jonathan Smith
  2. Cllr Alan Martin
  3. Cllr Paul Thomas
  4. Jonathan Smith
  5. Cllr Alan Martin
  6. Jonathan Smith
  7. Cllr Alan Martin
  8. Mr Alan Mitchell
  9. Cllr Tim Prater
  10. Cllr Alan Martin
  11. Jonathan Smith
  12. Cllr Alan Martin
Share this agenda point
  1. Jonathan Smith
  2. Cllr Alan Martin
  3. Cllr Alan Martin
  4. Mr Alan Mitchell
  5. Jonathan Smith
  6. Jonathan Smith
  7. Jonathan Smith
  8. Mr Alan Mitchell
  9. Cllr Alan Martin
  10. Jonathan Smith
  11. Cllr Alan Martin
  12. Mr Alan Mitchell
  13. Cllr Alan Martin
  14. Cllr Alan Martin
  15. Cllr Paul Thomas
  16. Mr Alan Mitchell
  17. Cllr Paul Thomas
  18. Mr Alan Mitchell
  19. Cllr Alan Martin
  20. Mr Alan Mitchell
  21. Cllr Alan Martin
  22. Mr Alan Mitchell
  23. Cllr Alan Martin
  24. Cllr Paul Thomas
  25. Cllr Alan Martin
Share this agenda point
  1. Jonathan Smith
  2. Cllr Alan Martin
  3. Cllr Paul Thomas
  4. Jonathan Smith
  5. Cllr Alan Martin
Share this agenda point
  1. Jonathan Smith
  2. Cllr Alan Martin
  3. Jonathan Smith
  4. Cllr Alan Martin
  5. Jonathan Smith
  6. Cllr Alan Martin
  7. Mr Alan Mitchell
  8. Cllr Alan Martin
  9. Cllr Tim Prater
  10. Cllr Paul Thomas
  11. Jonathan Smith
  12. Cllr Alan Martin
Share this agenda point
  1. Jonathan Smith
  2. Cllr Alan Martin
  3. Jonathan Smith
  4. Cllr Alan Martin
  5. Cllr Paul Thomas
  6. Jonathan Smith
  7. Cllr Paul Thomas
  8. Jonathan Smith
  9. Cllr Alan Martin
Share this agenda point
  1. Jonathan Smith
  2. Cllr Alan Martin
  3. Cllr Tim Prater
  4. Cllr Alan Martin
  5. Cllr Paul Thomas
  6. Mr Alan Mitchell
  7. Cllr Alan Martin
  8. Cllr Tim Prater
  9. Cllr Paul Thomas
  10. Cllr Alan Martin
  11. Mr Alan Mitchell
  12. Cllr Alan Martin
  13. Mr Alan Mitchell
  14. Cllr Alan Martin
  15. Webcast Finished

Cllr Alan Martin - 0:00:11
So, good evening and welcome to the meeting of the Finance and Performance Subcommittee.
This meeting will be webcast live to the internet.
For those who do not wish to be recorded or filmed, you will need to leave the chamber.
For members, officers and others speaking at the meeting,
it is important that microphones are used
so viewers on the webcast and others in the room
may hear you.
Would anyone with a mobile phone please switch it
to silent mode as they can be distracting.
I would like to remind members that although
we all have strong opinions or matters under consideration,
it is important to treat members, officers
and public speakers with respect.
So, welcome everyone. Sorry for the slight late start, but we're nicely up and running.
So we'll get on with the agenda. First of all, apologies for absence.
Mr Jake Hamilton - 0:01:08
Thank you, Chair. We have apologies from Councillor Wing, Akufu Kelly and Rich Holgate, of which
Cllr Alan Martin - 0:01:18
we have Councillor Elaine Martin as substitute. Thank you, Jake. And thanks, Elaine, for filling

1 Apologies for absence

2 Declarations of interest

for us. So second on the agenda then we have declarations of interest. Can I ask if
anyone has any declarations of interest?

3 Quarter 1 performance 2026/27

No? Perfect. So we'll move smartly on to the third item. So quarter one performance
26 -27 and this is going to be introduced by Gavin Edwards. Great. Thank you Chair
Gavin Edwards - 0:01:47
Enberg and evening members. So this report provides an update for the first quarter of the
26 -27 year covering the period the 1st of April to the 30th of June.
The report highlights the performance against the agreed set of proposed
performance indicators approved by cabinet on the 22nd of July this year.
Appendix one of this report sets out the corporate performance report and it provides a summary of the KPI performance for finance and customer services,
strategy and partnerships, housing and operations directorates minus the housing landlord service.
And appendix two of this report provides a summary of the KPI performance for the housing
landlord service itself.
On the summary of corporate performance, overall we've met target on 43 out of the 64 indicators,
which is about 67 % across the whole organisation.
We are within 5 % of target and on track to achieve year -end target on 14 of those indicators,
22%, and off target on seven indicators, which is 11%.
And the graph on page eight of your report pack shows that summary.
There has been some noted positive areas of performance in Q1 with planning applications
determined, indicators exceeding, target for major and minor and other applications, housing
benefit processing and call targets were met, new claims were within 10 .3 days and changes
within 3 .3 days and 88 % of those calls answered.
Information governance and complaints, FYI and EIR and SAR and data breach indicators
were met or exceeded target and 95 % of formal complaints closed on time.
And with customer support and Lifeline customer support calls answered 97 % and with a 98 %
satisfaction rate there and Lifeline met both call answering targets.
Environmental protection and community safety also met targets for successful prosecutions
and community projects while parks and volunteer hours increased within the same quarter last
year. There's been improved performance on council tax collection compared with
the same period last year as well. And on regeneration housing delivery,
we've included seven businesses accessing the Rural England Prosperity Fund grants,
42 affordable homes delivered and 99 private sector homes improved through
the council's intervention. Wasted environmental services, there were high
level and low level crimes, fixed penalty notices reduced and 97 % of streets
and surveyed clear of litter.
There are obviously noted areas of continued focus,
including food premises compliance,
homelessness prevention and relief, rough sleeping,
and the use of temporary accommodation
and bed and breakfast accommodation.
For the housing land or service,
we have met 17 out of the targeted indicators
in that report, which is 85%,
with two being 10 % being within 5 % of target
or on track to meet target at year end,
and one indicator being off 5 % at the end of Q1.
We've provided data for all of the 10 TSMs within the report, and seven out of eight
of those are on target.
And graph on page 10 of your report shows the data provided on the TSMs versus the performance
of Q1.
In section four of your cover report, we have added some commentary on page 12 onwards of
your report pack and those indicators where they have not met target.
And that's just a quick overall summary of Q1.
The report, once it's considered here this evening by members, will be presented to Cabinet
on the 14th of October.
I'm happy to take any questions.
Thank you very much, Chair.
Cllr Alan Martin - 0:05:05
Great, thank you for that, Gavin.
So I'll open it up for questions then.
Paul.
Yeah, thank you, Chair.
Yeah, thank you, Gavin, for the report.
Cllr Paul Thomas - 0:05:15
Again, I think it's worth reflecting on
some of the areas of high performance,
so it's good to highlight those.
Thank you very much.
Just in terms of Section 3 .7 on FRA,
remedial actions. The comment in there talks about the fact that we've got 36
overdue actions with the planting for five -door remedial work. 27 of those are
overdue high. In the commentary it says risk is mitigated through regular safety
cheques, contractor and staff reporting domestic inspections, and routine
in communal health and safety inspections, which is great.
Do we have a completion date
for those outstanding fire door compliance issues, please?
Thank you.
Thank you, Councillor Thomas, for your question on that.
Obviously, I don't have that information to hand,
Gavin Edwards - 0:06:15
but obviously you will note that the actions
that you've referred to,
they're obviously on a rolling programme of work,
so I would assume there is a completion date of some sort,
and I'm happy to clarify that with the compliance team on that matter.
But yeah, as I know, it's on a rolling programme of work,
so it is on their radar to make sure these actions are addressed,
so it is constantly being monitored.
But I will obviously clarify that on that position.
Thank you very much for that.
Cllr Paul Thomas - 0:06:44
I'm just mindful that here we are just a little while away
from having that massive fire at the Verstun.
And one of the things, and the point that Jim made in here last week at OSC, was compartmentalization had a massive impact on the fact that so many people got out of there with no injuries.
And again, fire doors are part of compartmentalization.
So again, I really would urge the council to make sure that those things are treated with the urgency, which I know they are, they say they're part of planned work.
but I would like to see a completion date for those please.
Thank you very much.
Cllr Alan Martin - 0:07:27
So maybe I'll come in with a couple of questions.
First one relating to the 485 decent homes failure.
So we've missed that target a little bit.
Just wondering if you could speak a little bit about that.
And is that just a blip or is there an issue that's causing that and how quickly will we get that one back on track?
Yeah, no worries.
Gavin Edwards - 0:08:09
Thanks for that question on that, Chair, on that.
Obviously we provided the breakdown there, as you'll note, in the exceptions comments
there as well, and that gives a breakdown of that 485 there.
Just a bit of an update on the position on that as of August.
That's gone up to 92 % now.
So that's 289 properties that do not meet the standard at the end of this period.
Obviously, there was a target in place to achieve 90 % by the end of September that was
in line with the recommendation with the regulator of social housing.
And obviously, that's been met as of August.
It's not reflected in this report because obviously, it covers Q1.
But as I say, at the moment, as of end of August, that's 92%.
So it is an improving picture.
And that was in line, and as I say, has exceeded the end of year target by September of 90 %
as agreed with the regulator on that.
Thank you. Tim, do you want to come in?
Cllr Alan Martin - 0:08:58
Cllr Tim Prater - 0:09:04
Just with some memory of previous reports on this, decent housing standards, broadly
on the 1st of April of each year, you get to the end of the year and you've done a decent
housing standard, it came to the end of April, and on the 1st of April, the standard cheque,
a number of houses will then fall back into requiring works, and you spend the year getting
all of those works done in order to get yourself back at 100%.
So it's probably the first thing,
you will always then have a number which needs to be done
in order to come back up to that.
So you end up with a work pattern which will look like that.
It's not that they don't drop a few off every month
during the course of the year.
It's broadly as on the first day of the year,
suddenly lots of them come under and come back up again
and being nodded at by Michelle,
which gives me great reassurance.
So yeah, that's very helpful context. Thanks for that.
Cllr Alan Martin - 0:09:57
Paul, do you have any further questions?
So I just, I'm conscious both of these we've spoken about before, so short questions, I promise.
But so first of all, just on the 50 % recycling target, we say in the report,
and I think we know that, so this is a little bit out of our hands, but we're consistently below target.
And I guess the question that's on my mind is, well, what is there that we can do about this?
And, yeah, so I'll go with that question first.
Okay, thanks, Chair, on that.
Gavin Edwards - 0:10:44
And obviously, the comments in the report there that I've obviously included there,
obviously does set out some of the picture and the context there.
We've noted about lighter materials and obviously seasonal variations to the garden waste and
some of those things are naturally obviously out of our control.
Obviously we've mentioned finally that there is a focused effort on improving capture rates
with communal properties, including flats as well and malthouses of multiple creation.
Obviously those are ones where there needs to be probably a bit more education and prevention
and education awareness in terms of recycling around that as well.
It's obviously noted 50 % has been obviously a challenge on that.
And obviously it's noted through previous years as well.
So there is that focus that the team are focusing on there.
There will probably have to be wider, you know,
if there was to be to try and stretch that even higher than 50%,
there would probably have to be other arrangements put in place.
Obviously I'm not the best place to comment on that with regards to that.
But that's in essence what they're focusing on really at the moment to try and help, a bit more to help drive recycling rates.
But it is noted a lot of this is outside of our control and it is also reliant somewhat on education and awareness with residents as well around that.
And the team are doing that.
There has been previous years, I think, when comments made to the committee around this about educational awareness and campaigns, etc.
But it is noted as being a constant challenge and I think that will continue to be noted in future reports as well.
Yeah, Tim, please do come.
Cllr Alan Martin - 0:12:14
Cllr Tim Prater - 0:12:19
Sorry, my context on this is I was in a county meeting on this a couple of months ago, and
this is going to get worse.
There's a deposit return scheme is about to be introduced whereby, I think it's cans and
bottles go back to shops and you get a deposit back that has been paid for those things.
Bottles are some of the heaviest stuff in your recycling at this stage, and if you take
and you take those out, your percentage is going to drop
really significantly.
So, although the deposit's quick, oh, that's great,
it means that that stuff will be recycled
and that we recycle through ridiculously
an entirely different collection mechanism
to everything which is currently in place.
Blow somebody else up for that.
It will mean that when that comes in,
getting to 50 % is even more of a stretch target
because you've taken the heavy stuff out of your recycling
and you've not taken the heavy stuff out of your general waste.
So I think we're going to have to look at how the target is measured,
look at whether we're measuring the thing that we need, that wants to measure,
whether we're looking at whether 50 % is realistic by the time those come in place,
and we'll wait to see what that scheme looks like and how successful it is and things like that.
But it might be a number that you're never going to hit
by the time you take that additional weight out of the waste.
Cllr Alan Martin - 0:13:37
I think that's a much more detailed point I was going to make,
but that's essentially going to be my question,
whether we think it's ever going to be achievable.
And it feels like there are some things that we can do.
I guess I'll be curious to hear from the team how confident they are,
given all of the points that Tim made and other things we've discussed before,
whether that is an achievable target.
Otherwise, we're just going to flog ourselves on something that we're never going to meet.
I mean, it's a very well -intended KPI.
I think everyone would agree that we should be looking
to make sure that we are recycling as much as possible,
but whether it's the right approach or not, I don't know.
Elaine.
Cllr Elaine Martin - 0:14:19
Yeah, I just wondered, because quite heavy stuff
is the electrical recycling, is there any way
that we can include that in the amount of stuff
that we're now recycling to our bit?
Thank you for your question on that,
Councillor Martin, on that.
Gavin Edwards - 0:14:35
With regards, I don't have obviously specifics on that and whether that could be included.
Obviously, I know that obviously the recycling is obviously set and there's a defined set waste contract in place around that.
I can take those comments back and obviously discuss those with the waste services manager for his views on that.
But obviously, you know, we've got obviously defined waste contract in place at the moment.
obviously sets the standards on recycling at the moment, but noted comments and I'm very happy to take those back even to have those reviewed.
Go for it, Paul.
Cllr Alan Martin - 0:15:09
Cllr Paul Thomas - 0:15:14
Yeah, thank you. Just something I wanted, I've written it down here, but I hadn't mentioned it earlier on.
And it aligns perfectly with the award that we received earlier in the year.
So again, if you look at the housing amendment service, outside of the Decent Homes standard,
you know, everything else is really, really positive in there, you know,
the tenant satisfaction measures and things like that.
So again, I think it's just worth recognising, you know, the efforts of the housing team
and the others that go towards making that as successful as it is.
So thank you very much for the team for doing that.
Yeah, very good point.
Cllr Alan Martin - 0:15:49
And then the final one from me,
on our old favourite, the fly tipping.
So I'm really, I know we discussed this at the last meeting,
I'm really pleased we've got this metric now,
because one of the things that was concerning me
is we weren't shining a fair spotlight on the real issue,
which our residents see.
And when you look at the numbers of tips that we clear,
and the action that we're able to take in court.
It's actually a fraction of the cases that are observed.
I'd be interested as a takeaway from today
if we could get an update from the team
on what we can be doing to,
well, what we're doing already
and what more we can be doing
to get those overall figures down.
I know there are complexities around
what we're obliged to do and what we're not obliged to do,
but I think all residents would agree
that if we could, with better enforcement
and maybe CCTV cameras and engaging with other agencies,
if we could get that scourge reduced somehow,
that would be a positive KPI to track.
Again, thank you for your comments on that,
Gavin Edwards - 0:17:04
Chair, with regards to that.
I did actually raise a comment, a question with that,
with Andrew Rush on it as well.
And there are a large number of,
obviously the action's in place already.
There's obviously use of CCTV in hotspots, investigations carried out by the Environmental
Protection Team, prosecutions where there is evidence that has been obtained.
There is also noted obviously a KCC organised county -wide conference on fly tipping that
he attended around that as well.
There is a positive development that there appears to be increasing, to be more increasing
recognition at a governmental level that fly tipping is a national problem and that requires
national solutions.
So things for example like multi -agency responses to larger fly tipping incidents and more direct police involvement in the investigation
particularly into organised crime involvement in relation to fly tipping as well.
So that's just a bit of general context, but obviously noted of the work more widely,
but obviously noting your comments as well around the work of the team and it continues obviously to be a proactive measure,
but noted we'll go back and see what other bits there are to be considered.
Cllr Alan Martin - 0:18:12
And thanks for doing that extra bit of digging as well,
that's really helpful, thank you.
Any final questions or comments from anyone?
No, in which case, let's draw that section to a close.
So recommendations for members then are to receive
and note the reports, to note the corporate performance
report Q1 and appendix one and to note the housing performance report Q1 and appendix
two.
So can I ask for a proposal?
Thank you Paul and Elaine.
Thank you very much.
And a show of hands.
We're going to have to take it in terms this evening.

4 General Fund Revenue Budget Monitoring Report 2026/27 - Quarter 1

Great so let's move on to agenda item four.
Also, this is the General Fund Revenue Budget Monitoring Report 2627.
So first one of the financial period Q1, and this is going to be introduced by Jonathan Smith.
Thank you, Chair.
Jonathan Smith - 0:19:23
So this report presents the quarter -wide monitoring for 2627 for the General Fund Revenue Budget.
It highlights a projected year -end unfavourable position
of 503 ,000 against the 28 .2 million net revenue budget
based on an expenditure and forecast
as at the 30th of June, 2026.
So the report asks for the Finance and Performance
Group and subcommittee to provide comments
on the recommendations which are for cabinet.
Paragraph 1 .1, I should just,
before I go into the main report,
paragraph 1 .1 needs to be amended just to remove
or just clear up the first line of paragraph 1 .1
which talks about sort of the most significant
financial pressure, which is actually in the
housing benefits and rent rebates.
Basically temporary accommodation.
The wording of the council tax reduction
is almost erroneously used there,
because that's just the name of the cost centre,
but actually it's to do with temporary accommodation.
So just to clarify that one point.
In terms of the main budget pressures as I mentioned,
it's across TA, which is to do with the housing benefits
and rent rebates that we get,
and it's expecting to create effectively
a £456 ,000 net budget pressure.
And also then we've got some other movements,
like for example the indexation on the waste contract,
which has a further 55K unfavourable variance.
However, on the waste contract,
it's also offset by a positive variance
in sort of the garden waste collection,
which brings it almost to a zero variance.
There are some other variances
in terms of the capital spending,
so there's higher than budgeted,
I'm sorry, there's the higher than budget income
for garden waste, but also the capital expense
to finance and revenue is projected to increase by 935 ,000,
but that'll be, but that's effectively offset
by increased earmarked reserves usage
to cover that particular spend.
In terms of the earmark reserves,
that's sort of outlined in the report.
Earmark reserves are projected at 16 .005 million
at the 31st of March, 2027.
And the report obviously highlights the key pressures,
but in terms of the, it's probably worthwhile mentioning,
this is the quarter one position,
so we do have to have some caution
in terms of the projections that we are projecting
at this stage, things can change.
What's clear, however, is obviously that the temporary accommodation pressures do continue,
but for context, there is obviously a mitigation strategy through the use of the Council's
own units to house people.
As members will be aware, there was £5 million through the HRA's budget to buy temporary
accommodation units that will be used through that Council -owned stock.
The first of those completed, I think, in June of this year, and obviously we're waiting
to work out the impact on the revenue budget from the savings in terms of the reduction
of the subsidy cap.
So that's sort of a bit of context in terms of those temporary accommodation pressures.
But I'm happy to take any questions you might have on the report.
Thank you, Jonathan.
Cllr Alan Martin - 0:22:38
So if I open that out for questions in?
Paul.
Yeah, thank you very much for the report.
Cllr Paul Thomas - 0:22:49
I had a question about the variances and the 935k,
but I think what you've spoken about has answered that.
The only thing that I want to raise is under reserves,
the figures don't seem to add up in terms of the change
to projected reserves.
So if you look at net transfers, they don't add up.
So I didn't know if that was just a timing issue in terms of when the report was produced for one part of it against when the table was produced.
That's on page 27.
Table 1.
Yes, I think, thank you for the clarification.
I think you're right in terms of the, I think it might be the general fund movement.
Yeah, I think, yeah, in terms of the total movement.
I'll make sure the table which is copied in has been correctly written out.
Yeah, no, that's great. Thank you very much.
And the only other item that I had in relation to the – where was it in there?
The net service expenditure and unfavourable variances.
We talked about the housing benefit, the 456K net impact.
What I didn't understand was under 3 .2, regulatory community services, we've got a 55K for increased
expected spend on waste and recycling.
And that talks about indexation figure being applied to the out term.
So do we know, have we got a figure for the indexation figure is what I want to say.
And is it what we, it doesn't appear to be what we expected.
Thank you for the question.
Jonathan Smith - 0:24:38
So in terms of the waste contract, this relates to something I think was reported to members
I think earlier on this year in terms of the waste contract and the indexation and the
invoices received from our waste contractor.
They've I think under -invoiced to an extent and basically part of that is they've now
corrected their invoices to us, which has created a sort of a slight variance.
but that was something that was previously reported
to members in terms of the waste contract.
I think it was the total amount.
And due to the timing of it, when we were setting the budget
we would have set on the older figures.
Then we've had the obviously indexation clarification
and so the budget would be slightly out
in terms of that indexation.
Cllr Alan Martin - 0:25:27
So you nicely explained, so this is obviously the first report of the year and there's lots
of uncertainty and we have to see how the year unfolds a little bit.
Obviously the big thing that's been concerning us is this housing subsidy gap and I just
I just wonder if you could just walk us through
a little bit more detail around kind of what assumptions
we're building in there and I guess,
I mean I know you're gonna feel like you're putting
good assumptions in there and you have a good level
of confidence, but I guess your perspective on
the risks and what the worst case scenario might look like
versus the assumptions that you're using currently.
Thank you, Chair.
Jonathan Smith - 0:26:17
To a large extent, the assumptions we're using here
are based on the presentation.
So obviously, this is a quarter of our report,
so we've got a certain number of presentations
for homelessness and temporary accommodation
as that say June.
We would have looked at the levels that we're seeing,
and then we'll, and obviously we then make an assumption
as to assuming this continues on this trajectory,
that's our sort of our projection.
However, as I mentioned also in sort of introducing
the report, there is obviously,
we've got a temporary accommodation strategy.
So we are looking to buy up to say 20 units approximately
to sort of help reduce those numbers.
I think in terms of the number of presentations,
it was around about 120 or so was the figure
that we were sort of hovering at.
And that number can obviously,
as soon as we get sort of more
of our temporary accommodation units online
and we're using council loan stock,
we don't have to suffer the subsidy gap for those units.
and I believe it was eight units that were brought online
in sort of June of this year.
So it will have an impact at the moment
we're still assessing that and obviously there are further
units that are in the pipeline
and to bring the number down further.
The assumptions we've used for this report obviously
are based on the presentations we've got and where we are
but there hopefully should be then the fruit born
of the strategy that we're taking
in terms of reducing those numbers as we go through the year
but it's difficult to quantify at this stage.
Yeah, Tim, did you, oh,
Cllr Alan Martin - 0:27:50
Alan, did you go first and then Tim?
Yeah, just by a bit of an update.
Mr Alan Mitchell - 0:27:54
So as Jonathan's already said,
we completed on eight in June.
There's another eight that are currently in the process
of being completed on,
and that's what we're looking for,
further opportunity as we go throughout the year.
Thanks, I'm just gonna make the point that
Cllr Tim Prater - 0:28:13
these are based on best guesses
in terms of number of presentations,
but for instance, in the second quarter,
no, was it the third quarter?
You'll see the boost in effect, for instance.
So, literally in the last 10 days,
we've supported a lot of people in temporary accommodation.
So, that wasn't budgeted for, that wasn't,
nobody could have known that you were suddenly gonna have
300 people, you know, 90 households
that you were looking for.
So the unexpected is what breaks your budget
on those things and that burst in effect
will be one that you will see come through.
Now we're gonna try and mitigate that.
Hopefully there'll be some insurance cover
and things like that.
But as ever with an insurance claim,
you never get all the money that you hoped
that you needed to spend to fix the problem.
So yeah, the unexpected is what breaks those figures
at that stage.
A few more presentations costs many thousands
of pounds a week.
Simple as that.
Yeah, thank you for that, Tim.
Cllr Alan Martin - 0:29:13
Just for my own information, I was just curious.
So when you're setting your assumptions around an item like that,
do you have the scope to do that conservatively
in the hope that you can then kind of unwind as the year unfolds,
or is that not practical when you just go over your best estimate
and then kind of ride the wave as it happens.
Thank you, Chair.
Jonathan Smith - 0:29:42
We do try and sort of estimate where we will be.
So when we set the budget, so the 26 -27 budget was set
based on, we set it roughly this time last year,
and we did it based on the presentations we had
at the time.
Now, it's obviously turned out that I think landlords have,
because obviously the subsidy gap arises
when you've got the private,
and we're putting people into private accommodation.
So, landlords and the private sector
have increased rents higher than obviously we anticipated,
which has caused some of the pressure that we're seeing.
So, that's something about 436K.
We based on two factors,
either increased number of presentations
or an increased cost to us of providing the units.
Now, obviously we can only claim back from government
a certain amount per night.
And unfortunately, we can't control any sort of a fee,
any of those assumptions about what the Daniels might
increase their bills by.
We're obviously capped at the amount we can claim back from commute,
and the cost of it can rise sometimes more so than we estimate.
And it seems obviously in this case, we put it, we increased the budget
to about £1 .3 million as a subsidy gap,
but it's exceeding that at the moment.
Yeah, thank you Jonathan.
Cllr Alan Martin - 0:31:04
There's only a few of us on the committee tonight,
so I'll give everyone a little bit of breathing space
to look at their notes
to see if they've got any further questions,
myself included.
So I think my questions are more covered in the later agenda items myself.
Anything else from Elaine, Paul?
So that brings us to the end of item four then.
So the recommendations for members are to receive and note the reports.
Oh, in fact that.
To receive a note report.
So can I ask for a proposer?
Thank you Elaine and a seconder Paul
and a show of hands.
Great.
So we'll move on to agenda item five.
So this time looking at the general fund capital programme,

5 General Fund Capital Programme Budget Monitoring 2026/27 - Quarter 1

budget monitoring 26, 27 quarter one.
and again this is going to be introduced by Jonathan Smith.
Thank you, Chair.
Jonathan Smith - 0:32:26
So the quarter fund capital report obviously outlines the projections of the Council's
general fund capital programme for 26 -27 and explains any variances against the approved
budget and any sort of programme changes.
There's a minor error in the table at Powerpuff 3 .2 which should read 27 -28, not 26 -27 in
in the middle section.
It's just a point of clarification
which we'll correct for the cabinet report.
In terms of recommendations,
obviously it's asked to comment
on the recommendations for cabinet.
Note this report.
In terms of the monitoring position,
the five year MTCP, the medium term capital programme,
to 30th at first of March, 2031,
was approved by full council in February of this year,
and this provides the quarter one projections against that.
It's obviously based on the first three months of the financial year and will be revised
through later monitoring reports that are brought forward to members.
Paragraph 2 .2 details any existing budgets that have been increased, for example, 132 ,000
for Ship Street and 10 ,000 for Seaport Play Area, and also the five new schemes that have
been added to the capital programme since the budget was set, sort of lifeline to equipment,
the Port Ella Lakes item, Mermaid Beach,
and the Mermaid Beach storm damage and repairs
and swimming pool support fund,
as well as a number of other items.
The funding position for those new projects
is obviously outlined, and in terms of the,
we've mentioned it in the sort of general fund
revenue report, that a number of those projects
are funded through the use of earmarked reserves,
which is outlined in the report,
totaling sort of 1016K or 1 .016 million.
And the projected out turn for the 26 -27 is 39 .1 million,
which is 3 .7 million pounds above the latest approved budget
of 35 .4 million.
However, most of that relates to the reprofiling,
which is obviously the details you find
paragraph 3 .2 of the report.
And I'm happy to take any questions you might have.
That's great, thank you Jonathan.
Cllr Alan Martin - 0:34:44
Cllr Alan Martin - 0:34:48
See if one's going through their notes.
I'll maybe ask, so just obviously a lot of these are, so the new capital programmes are
ones that we all know well and we've had discussions on most of those in overview and scrutiny
So it's quite clear what they are and how they're performing.
So that's all good.
I had a question.
The, can you remind me, so I've got two swimming pool related questions.
So can you remind me specifically what the swimming pool support fund is and what that relates to?
So is that Hive pool or Folkestone?
and then more generally, can you remind me
where we're gonna see the grant expenditure
to folks in swimming pool?
So where would that come through?
Would that be in the capital programme
or would that be somewhere else?
Mr Alan Mitchell - 0:36:20
So the Swim Support Fund, so that was basically a grant that we received from Swim England
and that's to support the works at the Folkestone Nature Centre.
Sorry, that one is.
And the second one.
Jonathan Smith - 0:36:33
And that's page 64 of your pack.
I think it's item 49 on the appendix.
In terms of your other question regarding the money
for the high pool, 2 .4 million,
that will come through the capital programme.
I'm just trying to find the line item.
I made that mistake.
Next line, please.
Jonathan Smith - 0:37:03
Jonathan Smith - 0:37:20
Line 25 on page 65 is the funding for the swimming pool.
Mr Alan Mitchell - 0:37:35
So just to give further clarity on that one, obviously that grant is in the rears, so it's
dependent on work being completed and then being qualified.
So as those works are undertaken and we review that work and sign off that level, then the
grant would be paid across and then you'll see the actuals increase if we pay that grant.
Thank you, Alan.
Cllr Alan Martin - 0:37:57
and that was gonna be my next question,
was how that was gonna run.
Sorry Jonathan, what line was it?
Page 60.
Jonathan Smith - 0:38:06
Page 65 and line 25.
Cllr Alan Martin - 0:38:11
Ah yes, fabulous.
Okay so it's in there at the 2 .4
and then as we forward the payment across
we'll see that move.
I'm very conscious of the fact that their plans
got put back by the vandalism and everything that happened, but do we have an update on
their timelines for launching the pool and I guess link to that when we'll be starting
to make some payments?
I don't actually know to be a fair answer.
Mr Alan Mitchell - 0:38:39
So I know it was put back, but I think they were trying to reschedule their programme to
try and catch up, but I'll take that way as an action just to get that information
in the retail collector.
Cllr Alan Martin - 0:38:55
Cllr Alan Martin - 0:38:59
Any questions, comments?
Paul.
Yeah, thank you very much.
Cllr Paul Thomas - 0:39:06
I've got one question.
On 3 .2,
It's got Sandgate Road car park sprinkler system replacement. We had 100k in the budget for this year.
We've got 10k allocated for professional fees. So that's also in Appendix 1, item 42, by the way.
And we've got, there's 90K which we've showed
that we're not going to spend.
I think I'm right in saying that.
So my question is based on where we were,
or where we are, I should say,
with the fire at the Burstein Hotel,
and the fact that Jim briefed us at OSC last week,
I asked the question specifically
as to whether they had a fixed jet fire protection system,
the sprinkler system was told no.
I'd like to know what's the status of the sprinkler system
at the car park, bearing in mind that there are people
living in multiple storeys immediately above it.
It has electric vehicle charging points in there as well.
And again, you're more likely to get a fire from a car
which is being charged than the car
which is just sat there doing nothing.
So I've got a concern over that sprinkler system to say,
is it functioning currently, and is the money
that we're due to spend on it to bring it back into service,
or is it serviceable currently, and we're going to upgrade it
because I think just in terms of what that answer
is likely to be, I think it would be prudent for us
to go back and have a look at our risk register
to say, bearing in mind where we are with the knowledge we now have from the Burston,
whether there is an increased risk with that knowledge to that particular place,
bearing in mind, as I said, we do have people living immediately above there.
So again, I think it's just satisfying everybody that we have a viable sprinkler system
at a place which has residential properties immediately above. Thank you.
Mr Alan Mitchell - 0:41:39
Thank you for the question Councillor Thomas. So I think the first point I'll just underline is that the
results of the burst and fire, the cause of it, that's still an ongoing investigation. So,
you know, I wouldn't like to say that it was a cause of an electric vehicle being charged, but, you know, that's obviously an ongoing investigation.
So in terms of the sprinkler system in the car park, so from what I understand,
the sprinkler system is operative at the moment, so it does work. However, that it's
of an age where the equipment isn't sufficient, so the equipment, if it had a
significant surge, wouldn't probably be able to cope. So the money that's in the
budget at the moment is to assess the actual cost of replacing that
completely. So that's currently where that's what their funds is and so your point is very
well made in terms of risk and the residents above. So that piece of work is being accelerated
as fast as possible in order to not only assess what works need to be done but help the programme
of works to be able to replace those?
I think I'm all worried now actually.
Cllr Paul Thomas - 0:42:54
I understand now.
So again, I think I know that the investigation for the five of us is ongoing
and there will be things coming out of that.
But there have been numerous other incidents across the country over the last three or four years
with car park fires that resulted in massive amounts of destruction.
And one of the things I think that we owe a duty of care to people in the district
is to understand where that hazard exists,
where we've got underground car parks
or where we've got car parks
with residential properties above,
that we're satisfied that the arrangements
we have in place for managing those systems,
and if they're not fully capable, if you like,
and that they need modification, they need upgrading,
I think we need to understand that and just make sure that whatever mitigations we're putting in place are adequate to mitigate that particular risk.
And again, I'll raise it with the Sandgate Road car park because, again, one of the things that Jim mentioned with the Burston was the fact that it was the staff at the Burston who went round,
did everything they could to get people out of there
because that's what they were trained and set up to do.
So my question would be,
for the people who live immediately above that car park,
are there adequate arrangements in place
to make sure that they understand
what they need to do in an emergency?
So again, I'm just thinking out of the box a little bit,
but just saying, are we doing enough
to make sure that we have taken that learning
from the bursting and applied it where we can to those things which we have
control over. Thank you very much. So if I may, I mean they're absolutely very
Mr Alan Mitchell - 0:45:08
correct and valid points that you make. I will take back a couple of actions if
that's alright. Firstly to just update in terms of the actual project, the
understanding, the work that's currently ongoing to understand the replacement
and what that looks like but also I'll take an action to speak to the appropriate person
here, the officer here, to then reach out to residents and just see what fire precautions
and fire drills and procedures are in place for that and we can assess that. I think very
much like with a lot of significant fires that happened up in the Grenfell being a significant
one as well, there's always learning that comes out of it.
And I think one thing that we're very keen, particularly here, is making sure that where
we do learn things, that we try to apply those as quickly as possible and appropriately as
possible.
But if that's right, there's a couple of actions I'll take away from that.
Cllr Alan Martin - 0:46:12
Yes, brilliant point, Paul.
Point of clarification, is Sandgate Road car park the one for the Leescliffe Hall under
the...
fully appreciate your concern. Does that have charging units in it? It does, yeah.
I've got a question if no one has at the moment. So later on the agenda we'll be talking quite a
bit about inflation I suspect. I'm just interested to get a sense we've got some big capital projects
here, just your thoughts on how exposed each of those are to inflationary risks
and how much of that we've got we've got lockdown?
Mr Alan Mitchell - 0:47:01
I think Jonathan, I'm going to say. So it depends. So a lot of our capital programmes are fixed price, so we've gone out, we've done the tendering process, we have those in place.
Where the issue becomes more of an issue is when we're going forward with new programmes.
So you're absolutely right in terms of building material, building cost consultants, all those
different trades that go into a particular project, they're all more susceptible to interest
rates.
As interest rates increase, so will the cost of a project.
But for the majority, and John can correct me if I'm wrong, but particularly the vast majority of those
were more working on fixed prices, they're in situ or they're already built into the GARCH contract itself.
Cllr Alan Martin - 0:47:50
Yeah, thank you. So, looking at the big ones then, so we've got FOCA 2, FOCA 2, folks in brighter future,
Hive Pool. So something like Hive Pool, obviously we're still going through the consultancy phase,
so that has to sort of hang in the air
until we get a bit clearer,
but we also have the ability to decide consciously
what we do, so with folks from brighter future,
that has all been tendered,
and that is all locked down is my understanding,
but FOCA too, where are we,
can you remind me where we are in the process there?
Mr Alan Mitchell - 0:48:25
So it's a stage process, currently we're in the,
I would say second stage,
but basically all that contract works has been done.
So in terms of the actual going into the building,
doing the works in terms of curing that,
the looking at the party walls
so where we're separating the Volcan 1, Volcan 2,
that's all been contracted and that's in place
and we're quite far advanced on that work.
Where we're gonna go back to the fit out,
so when we look to do the ICB
and we look to do the fit out,
that's where we may be more settled to interest rate increase or cost increases.
Cllr Alan Martin - 0:49:08
Any other questions or comments from anyone?
Cllr Paul Thomas - 0:49:20
Yeah, just again, just in terms of FOCA, we are taking three planning
applications at the Planning and Environment Committee next week in relation to that.
So again, I think that shows that we are making progress against those things, that we have
to.
And again, it just demonstrates that the process we have to go through, because it is our building,
we do have to take that through committee, will in itself slow things down slightly,
would be my view of the world actually.
Great.
Thank you, Paul.
Cllr Alan Martin - 0:49:56
So if we don't have anything else I might draw that item to a close.
So our recommendations are to receive a note report, to note the amendment to the capital
programme for 26 -27 as detailed in paragraphs 2 .2, 2 .3 and appendix 2 and to note the violence
of 84 ,000 to the West Hanger Castle,
out of Courtyard.
Which I don't remember us speaking about actually.
But I guess we can, I'm sure we all read about it
and we can note it nonetheless.
So can I ask for a proposer?
Thank you Paul, it was your turn.
And Elaine and a show of hands.
Thank you.
Great, so let's move swiftly on to item number six.

6 HRA Budget Monitoring 2026/27 - Quarter 1

This is the HRA budget monitoring 26 -27 quarter one, which will again be introduced by Jonathan.
Thank you, Chair.
Jonathan Smith - 0:50:59
So yes, this is the quarter one, 2026 -27 HRA monitoring report.
This summarises the HRA's revenue and capital projections based on expenditure through to
30th of June, 2026, and explains variances against the approved budget. At this very
early stage of the year, projections of the HRA can be quite challenging to forecast,
given the relative stability of the HRA account, and there's little to specifically highlight
two members at this stage, but obviously as we move through the year, a clearer picture
should emerge. As you'll note, there is a very small forecast variance to budget on
on the revenue account of 17 ,000,
and on the capital budget, excluding new builds,
specifically the variance is only 8 ,000.
And obviously it's useful to sort of split
the new build line out, because that will always flex a lot
depending on the stages of development,
and the progress of those developments,
and really the planned works element,
which is the usual work that we do on our properties,
and the maintenance of those properties.
The variance is only showing as currently as 8K.
But again, as I said, it's difficult to project at this stage.
It's quite early in the year.
Obviously, this is quarter one, only three months of the year.
But I'm happy to take any questions you might have on the report.
Thank you, Jonathan.
Cllr Alan Martin - 0:52:15
Paul.
Yeah, thank you, Chair.
Cllr Paul Thomas - 0:52:23
Yeah, I think when you have a look at the 17K variance in QL,
I mean, that's excellent performance, isn't it, you know, in growing the body standards.
I just have one question which is in the table on 3 .3.
We're showing under section 106,
a projected out in the 77K there.
We're showing that as a variation.
Do we know where that's come from
and what's driving that?
Because I didn't see anything in the explanations
as to why that section 106 money is there actually.
Thank you.
Jonathan Smith - 0:53:02
Thank you, Mr. Thomas. So I'd have to look into the specific detail of the 77k, but normally
it's a case of, well, if you will, we're using Section 106 on, for example, our new bills
programme, and the funding elements. So we create a budget, particularly for the HRA, and we
create a balanced budget in terms of the funding sources for that. That will obviously, as
we move through the year and as developments happen, we might have spent something or have
additional Section 106 money available to fund some of the programme. And we'll always
spend grant money as one of the first elements of financing because obviously we'll take
it in order and we'll use some reserves and borrowing as sort of the last elements. We'll
use grant funding first. So it's likely to be a case of we've got a scheme now where
We've got some spend and we're able to spend some of the section 106 as against that scheme.
I can find out the specific details though and report back to you if needed.
Cllr Alan Martin - 0:54:12
So I didn't have any questions or comments on this one.
I think we're good.
So as you say, it's very, very early in the year,
so we'll watch this one carefully in future courses.
So we'll bring that item to a close,
and recommendations for members are
to receive and note the report, and to note
the revised latest approved budgets in Appendices 1
and 2.
And so if I can have a proposer.
Thank you, Elaine.
And a seconder.
Thank you, Paul.
And a show of hands.
Great.
So we'll move on to item number seven.

7 Treasury Management Annual Report 2025/26

So this is the Treasury Management Annual Report 2526.
And Jonathan, you're gonna kick us off on this one as well.
Thank you, Chair.
Jonathan Smith - 0:55:01
So this report presents the Council's 2526
Treasury Management Activities.
And it sort of details the compliance
with the approved strategy and the indicators,
potential indicators.
It provides sort of an economic conditions overview
in terms of borrowing investments, financial performance, and some risk controls. And at
the 31st of March, 2026, the council had, for example, £117 .8 million of loans, and
with Treasury investments returning 5 .03 % on return during the year. It does also highlight,
however, the council did exceed the maturity structure of borrowing indicator, which is
basically an indicator on the short -term and long -term debt split between how much you
short -term borrowing and how much you have in long -term borrowing. The limit was 30%,
however it reached 43 % during the year. The reasons for this are largely down to the
volatile markets towards the end of the year. So as the council was due to refinance some of its
borrowing, because some previous borrowing had become to maturity, we actually explicitly
received some external advice from our treasury management specialist and
advisors to hold off borrowing because to refinance in a particular period of
heightened volatility so obviously at the end of February and the conflict in
the Middle East started and the markets went particularly became particularly
challenging and if we'd refixed at that time we would have fixed in at a for a
longer term at a higher rate than was normal because at the time actually
rates were returning to a level of normality.
However, the conflict obviously changed that position.
So we were advised not to refinance
in using long -term or medium -term loans.
And so we kept it short -term,
which usually has a lower interest cost
rather than fixing in at a higher interest for longer.
However, we have sort of returned to compliance in 26, 27.
So whilst this was reported,
and is going to be reported to cabinet as a breach of the indicator in 2526.
We've now returned to compliance during this year.
So it was a short -term issue.
We've now sort of refinanced our borrowing and we're now below the 30 % indicator.
I'm happy to take any questions you might have on this.
Cllr Alan Martin - 0:57:28
Thank you Jonathan, and I did ask Jonathan and Alan a question around how our policy
around that indicator compares to other councils, and I think it would be good if you could
speak to that as well, because I think that's quite reassuring.
Jonathan Smith - 0:57:49
Yes, in terms of the indicator, obviously members are able to set the levels, and obviously
our council and our members set it at 30%.
Our neighbours don't necessarily have the same limits as us.
I think Ashford, as an example, have 100 % limits.
They have effectively, they have no restriction
on how much they can have between short
and long -term borrowing.
So it does depend on members.
However, we've discussed this specific point, actually,
with our treasury advisors about what's a prudent level
to set it up, and they're comfortable with actually
the 30 % is probably about right for the level
we set it out at the moment is approximately
the right level that we should be aiming for
in terms of that split, in terms of like the risk
associated with borrowing.
Yeah, perfect, and maybe I'll hop in with a question
Cllr Alan Martin - 0:58:35
because it links to that point really.
So it seems to me like we handled that
in an emergency situation very, very well,
and obviously we don't want to lock ourselves
into unnecessarily high interest rates
in our borrowing.
I just wonder if you can speak about how,
what impact it would have on the council, I guess,
and how exposed we are to that risk,
I guess to a certain extent.
That's, you won't be able to tell us
where interest rates are gonna go,
but when you look at the rate
that we're borrowing at currently,
and we'll need to borrow for our
current sort of capital programme,
What does bad look like?
At what point do interest rates over the next few years
actually cause us a significant problem?
Thank you, Chair.
It's a difficult question to answer
Jonathan Smith - 0:59:31
because obviously in terms of our short -term borrowing,
around about the time, say we'll take early in this year,
so January, February time,
short -term rates were hovering around
of the four and a half, between four and a half and 5%.
So we were keeping things short as,
short term was roughly about that rate.
Longer term, long term rates were sort of 6 % or just above.
At the moment, for example, if we look at sort of
some of our long term rates now,
you might be looking say for 30, 50 years at 6 .9%.
So obviously nearing 7 % from long term borrowing.
Short term borrowing is, I think, has just tipped over
is sort of 5 % now, so you can see the difference
between the two is, you know, it can be almost,
it's nearly 2 % in terms, yeah,
in terms of cost difference between the two.
It's always prudent to have a level in short term,
you know, even for cash purposes,
and the ability to sort of manage your debt portfolio.
Obviously, you get some certainty with long -term borrowing,
and that's why they charge you more,
because you get the certainty, but also the pricing in,
the uncertainty in the length of the borrowing that you take.
But yeah, in terms of what it looks like, I mean,
4 or 5 % is probably something that we, I mean, as an example,
in the HRA business plan, I think we used a figure around
about 5 % as being our level of borrowing when we set it in 2023.
But obviously, if we can talk to the latest figures we're getting on long -term borrowing
at sort of 6 .9 percent, that sort of gives you an idea about the cost difference.
Thank you.
Yeah, Alan, go ahead.
Cllr Alan Martin - 1:01:24
Mr Alan Mitchell - 1:01:26
So if I may add, so one of the things that we will do is in our Treasury management,
we will try to phase the approach.
So we try not to have too much debt maturing at the same time.
We also look to, in our capital programme, to understand when we will need to borrow
money, so within the keeping an eye on market to try and make sure that we lock in a preferential
rate.
When it comes to the actual capital programmes themselves, some of the things that we're
building will be sensitivity analysis.
So we will look at a return, the cost of delivering a capital programme.
We may be looking at the return on that and understanding, you know, kind of like what
sort of flexibility we have in the different elements that make up that programme, including
materials and obviously financing costs being part of that.
So we're quite alive in terms of trying to make sure that any of our capital programmes
that come forward are quite robust in terms of their business case, in understanding what
sensitively they have around the different elements of that capital programme.
So it's something that we're very, very mindful of.
Thank you.
Cllr Alan Martin - 1:02:33
So with that I'll throw it open for,
oh Tim did you want to come in, sorry.
Yeah, just going to briefly add to that,
Cllr Tim Prater - 1:02:42
as a collection authority we have the additional complexity
and slight wiggle to the fact is that we're also investing
quite a lot of short term cash at different points
in the year as well.
So from that point of view,
a higher interest rate is an opportunity,
which gives you at least a hedge
against the additional borrowing costs there.
if you're not a collection authority,
you don't have necessarily those peaks of cash
or that cash to invest in that.
So it absolutely does remain a difficulty and a challenge
and it makes it more complex in terms of understanding
what the impact is going to be.
But higher interest rates for a collection authority
are not an unmitigated curse.
But the balance of that and how one gets the best out of
that situation without paying the robots.
I mean, the idea is that you have lots of money invested
and you have no borrowings,
but that would be the place that we'd all love to live.
But so yeah, there are some balances there.
As a collection authority, we've got,
we are investing quite large sums
at different times in the year.
And if your interest rate is good on short term lending,
on short term lending for a period of time,
your return is better and that helps the remainder of the case.
So yeah, there's a mixed economy there.
Thank you for that, Tim.
Paul.
Thank you. Again, great explanation.
Cllr Paul Thomas - 1:04:06
I mean, Treasury management is a black art, isn't it?
There we go.
Just in terms of working capital, we're showing a movement in the period of 4 .3 million.
What sort of comes from 15 to 10 .7?
What impact does that have on how the council functions in the short or medium term?
Thank you.
Thank you, Councillor Thomas.
Jonathan Smith - 1:04:35
So, in essence, working capital movements will always generally happen.
It will be based very much on what's our maturing position,
what's the maturity of the debt that we have, to what our levels of reserves are.
So, it's a balancing act between all of these different things,
obviously reserves being effectively cashing the bank which we then invest and ensure we
get return on and whilst we also have our borrowing position. So movements and working
capital are statistical to a large part because they form part of the overall strategy and
it's something obviously we take external advice on from our treasury advisors who obviously
are aware of all the details and provides assistance to us to make sure we've got the
the right level of cash available.
It's also a balanced topic as against,
for example, collection.
As Councillor Fraser mentioned,
obviously we collect council tax,
so we're receiving cash in at various points in the year.
Generally, at the start of the year,
you hold the most cash,
and particularly in response to council tax,
which is paid over 10 months
for the majority of people at the moment,
you end up having less cash
towards the end of the year, so the last few months
the EU cash position changes.
But it's largely a case of just what level
of reserves we have, balancing off against
the actual cash flow needs, balancing off
against our borrowing needs at the time.
So it's difficult to read too much into that specifically,
but it's part of the overall strategy.
Cllr Alan Martin - 1:06:13
Did anyone have any other questions?
So that concludes agenda item seven
and
we just have one recommendation which is to receive and note the report.
So if I can have a proposer.
Paul and a seconder, Elaine.
And a show of hands.
Great, thank you.
So agenda item eight.

8 Treasury Management 2026/27 - Quarter 1

So this is treasury management report 2627, quarter one.
And it's quite a well established format now.
Jonathan is gonna kick this one off.
Thank you, chair.
Jonathan Smith - 1:07:08
And so this report obviously represents
the quarter one. So the previous report that we discussed on the agenda was the 25 -26 annual
report which covers all four quarters. This is effectively the first monitoring report
for the 26 -27 year which will obviously culminate in the annual report at this time next year
on this specific subject. Obviously the report asks for your comments on the recommendations
for cabinet. The borrowing position has obviously changed slightly. So borrowing fell $213 .1
million at the 30th of June 2026, whilst investments rose to 25 .5 million net and use of internal
borrowing and all the details of it are as with the previous report, there's an economic
update and sort of the macroeconomic update and interest rate update. The Bank obviously
held the rate at 3 .75%, which is outlined in the report.
CPI in June was obviously 2 .6%.
But obviously that's an increasing trend at the moment.
But I'm happy to take any questions you might have
on this specific monitoring report.
Thank you.
Cllr Alan Martin - 1:08:20
I'll maybe jump in with one.
So I think we've increased internal
borrowing in Q1.
So as part of our extended education process on such matters, I just wonder if you can
just speak a little bit about what influences us to shift our borrowing between the two.
I mean, I assume it's linked to interest rates and so on.
It links to the conversation we've just had, but it'd be good just to spend a bit of time
on that if we can.
Thank you, Chair.
Jonathan Smith - 1:08:56
So internal borrowing is where we might have, for example, we'll have some reserves to rather
rather than going to the market and going to, for example,
the PWLB and taking out borrowing,
we might use some of our reserve balances
to internally borrow against that cash.
So we've already got that cash,
and so it effectively delays us in the need
to actually take out some borrowing.
Now obviously, when you use internal borrowing,
you're losing the interest you might gain
on the use of those funds,
because it would have been, for example,
an interest -bearing fund,
because we would invest that
on the money market funds, for example,
but effectively it's still cheaper
than for us going out and doing some borrowing.
So we make effectively some savings,
we're hedging between the two items.
So that's what internal borrowing is,
is obviously when we use our reserves.
And it's part of the strategy is obviously
we try and delay any borrowing for,
in our capital programme, for example,
for as long as possible to delay fixing in
and locking in the costs that we'll have associated with that
so that the interest costs.
So that's, again, it's part of the overall strategy.
We'll use total borrowing where we can,
because obviously that just, it saves,
it saves in terms of interest costs.
Brilliant, thank you for that, Jonathan.
Cllr Alan Martin - 1:10:09
Does anyone have any questions?
Paul?
Yeah, just in terms of table two
Cllr Paul Thomas - 1:10:23
and 3 .3, section 3 .3 in the report.
I couldn't make the figures align in there.
Am I missing something or is it just an issue between what was written
and then how the table was put together?
Thank you.
Jonathan Smith - 1:10:52
Thank you, Councillor Thomas. So it's table two, you said, and...
Cllr Paul Thomas - 1:11:04
Table two and the text in 3 .3. I couldn't align the figures in there, so maybe it's
You've been stupid.
I think you might be right.
Jonathan Smith - 1:11:23
I'll have a look at and make sure those figures are
corrected.
I think they might be, yeah.
I'll make sure that's corrected before it obviously
goes off to cabinet.
Cllr Alan Martin - 1:11:44
So I didn't have any
further questions on this one.
Paul or Elaine, you do?
Well the year is still young so we'll bring item 8 to a close. Again
recommendations are just to receive and note the report. So if I can have a
proposer. Elaine and a seconder. Thank you Paul. A show of hands.
That's great. So move on to the the last item on the agenda. So this is the draught

9 Draft Budget Strategy 27/28

budget strategy for next year, 27 -28.
We're at the start of a long process.
So Jonathan is gonna kick us off on this item.
Thank you, Chair.
Jonathan Smith - 1:12:47
So this report presents the council's draught budget strategy
which goes forward to cabinet on the 14th of October.
And sort of sets the framework for setting the 27 -28 budget
in a sort of climate of economic and service pressures.
It aligned with the medium -term financial strategy
and sets out some funding assumptions,
some gap reduction measures, public consultation,
and any approval arrangements,
as well as the timetable for budget setting.
Obviously it highlights the current MTFS,
which was published in February 26th,
identified a cumulative 5 .37 million gap through 2930,
which did include an original 1 .096 million pound gap
for 2728.
Now, we utilise the 25 -26 out -term position surplus
to cover the gaps specifically for 27 -28
as it was identified in the MTFS.
However, it's important to remember that any growth agreed
as part of the 27 -28 budget will obviously have a recurring
impact on the MTFS.
And whilst the surplus covered the identified gap,
any growth that we identify now and put
into the 27 -28 budget will then create a gap.
And it's also worth bearing in mind
that it has a recurring impact
across the budget setting period.
So for example, if you add 50 ,000 pounds in year one,
then it has an effect in year two, three, four.
So it becomes four times the 50 ,000,
so a 200 ,000 pound impact across the overall MTFS.
Just something worth highlighting.
We've also included some key assumptions in here.
For example, an assumed 2 .99 % increase.
Obviously that hasn't been set by council yet, but that's an assumed assumption we've made.
And we've got the settlement figures, so obviously we were part of a three -year settlement for 26 -27,
and that runs to 27 -28 and 28 -29, so we're aware of the local government settlement figures
and that those assumptions are built into the report, including sort of like the business rates income.
We've also used an assumption of a 2 .6 % increase
for fees and charges, aligning with the policy
of using generally the June CPI rate, however,
of course we're in an inflationary environment
at the moment, and the August rate was 3 .1%,
and we expect September to be about 3 .5%.
But we utilised a figure to be able to set the budget,
and obviously at the time we sort of kick off the process
with budget managers. We use the latest figures that are available. However, they are able
to sort of adjust that. But as I said, we set out the assumptions. And obviously, we
set out the timetable in this as well. And we'll sort of request cabinet's approval to
start public consultation on the budget. I'm happy to take any questions on the overall
strategy that you might have.
Thank you.
Cllr Alan Martin - 1:15:44
Thank you, Jonathan.
Tim, is there anything you wanted to add on this one?
Not hugely.
Cllr Tim Prater - 1:15:56
I mean, it's broadly the same process we've been through
in the past, as you'll see.
The timetable is pretty similar to last year's, I think,
in terms of where it gets to.
It's an iterative process because numbers will change as we're going through these things
and we learn more things and budgets happen and interest rates change.
So there are a number of unknowns that this makes.
So it's very much not that there is a budget set they're writing or that written sadly
that we can just go through a consultation on.
So we are listening to that stage.
I certainly hope as we go through the consultation on this and, you know,
on the budget itself, but I think it was in 2023, 24's budget, when we went to consultation,
we had four responses and one of them was nine. I hope we can beat that this year.
Cllr Alan Martin - 1:16:54
Great, thank you, Tim. So any questions or comments from members? Paul?
Cllr Paul Thomas - 1:17:02
Yeah, thank you very much. Again, it's very clear, isn't it, that we've been, we've
I've failed on this board a few times now.
I just got one plea really, I think,
for Town and Parish Councils,
and that's to make sure that the dates
by which they're going to receive information
and need to get the information back,
the sooner we can communicate that to them,
the better it will be.
And secondly, are we planning to make any changes
to the paperwork that they receive?
Because I know the spreadsheet that's used
is very well received from Town and Parish Councils.
it makes it very easy for them to do what they need to do.
So that's my question, that's all, thank you.
So I'll respond to that.
Mr Alan Mitchell - 1:17:41
Very eagerly, very eagerly I'll respond to that one.
So we took some learning from last year's process
and so we actually wrote to all the parish councils
back in June, July?
Really early, it might have even been earlier than that.
We wrote to all parish councils,
let them know when all our dates were
and when we'd need the information back
as well as when we would be sending them information.
And there's no plans to significantly change the paperwork reforms
because we know that people are familiar with them, well received.
So there's no intention to operate in that sense.
Go for it, Tim.
Cllr Alan Martin - 1:18:20
Yeah, as an enthusiast for this part of the process, as John and Mohammed know on that.
Cllr Tim Prater - 1:18:24
So yeah, we were very clear.
What we wanted to do is make sure that we sent out
the timetable for this year at the time
that people were setting their meetings timetable.
So it literally went out so that people could hit their AGMs
for setting that.
I believe that it's the sixth of January we're asking for,
eighth of January that we're asking people
to have their budget settled by
so that we can have those figures back in.
But that's why we sent it so early
so that people could align those meetings
so that they knew what they were expecting.
So a number of people will be looking to do it
in their last meeting in December
and agree those precepts and get those back.
Or if they want to, they could do it
in the first few days of January.
But yeah, you are absolutely right.
It's making sure that people knew about that
close, early enough that they could set those meetings
and hit that timetable.
Previously, we'd kind of said, we'd told people,
but they didn't have a meeting that they could do it in
because it wasn't set for the right time.
And the numbers did, and the times didn't align.
I'm really hopeful this one does.
And yeah, that spreadsheet was introduced about three years ago, and one of the greatest innovations that we've had in terms of our community -centred parishes makes it so much easier completing that precept form.
I've got one more question, if I may.
Section 2 .18, we'll come to fees and charges.
Cllr Paul Thomas - 1:19:42
We did raise this at Ovi and Scrutney last week because we have an outstanding item,
the Cancro, Ovi and Scrutney earlier in the year about the free 20 minutes,
a free 20 minutes for parking across the district.
And we challenged the assumptions that were in there with regard to the funding of that,
how much it would actually cost to implement that.
And the feedback we had at OSC was that this would be incorporated in the review that was going to be carried out
for fees and charges that would be going to the managers and that you've set out in the budget setting timetable you've given us today.
So I just wanted to, it's just a plea really to make sure that we have an opportunity of seeing that through OSC
and we can close that particular item out in a timely fashion really.
So it's just a plea to make sure we know what it is.
Because if we're going to be putting, in the report we talk about a 2 .6 % increase.
We're just saying now that that's more likely to be a 3 .5 % increase.
I think if we can warm people up as to what that's likely to be, the sooner we do that, the better.
That's it for me. Thank you. Just a clean minute.
Cllr Alan Martin - 1:21:15
I've got a slightly vague question. So I know with LGR on the horizon, we had to keep to our kind of business as usual kind of holding pattern and not make any decisions that took account of that.
but we did also, I think we set up some reserves
to take account of the costs of LGR.
Just interested in, so what do we now do?
Or do we equally do nothing until we get further clarity
and just hold, do we hold those reserves?
Do they come onto the table, that kind of thing?
No, you're absolutely right.
Mr Alan Mitchell - 1:21:51
So we put a million pounds into the LGR reserve
specifically to fund the LGR work.
I've taken the view that as LGR has been paused for this time being, and we have no certainty
about how they will take it forward, whether or not LGR will be just paused for a single
year, whether it will be superseded by anything else.
So for the time being, I've left that reserve, that million pounds in that reserve, we have
utilised some of it through staff costs, but I have left that reserve there.
As we get more clarity, hopefully from the government,
I think hopefully we expect an announcement mid -October
in terms of maybe just timetable in terms of that review.
But as more clarity comes out, then I can revise that view.
If they say, okay, it's a year, then that reserve is still going to be utilised.
It can be superseded by devaluation or strategic merit authority.
then again we can utilise or look to decide how we utilise
that reserve, but for the time being I've left it where it is.
Perfect, thank you Alan.
Cllr Alan Martin - 1:23:00
And then a slightly, I guess, soft question
on the same point.
I know we discussed it, but I can't off the top of my head
remember whether it did influence our decision making,
but things like new IT systems, new hardware,
that kind of thing.
Were there any decisions that we made with LGR on the horizon to hold off on any of those
investments and then do any of those things come back on the table?
So I actually don't think there was.
Mr Alan Mitchell - 1:23:30
So I think because of the time here, for example, the new finance system, well, that decision
was taken a year ago, over a year ago, and implemented in April.
What we've been doing is taking the view that even as we go through LGR and we do that consolidation,
We've really at that moment where we were starting to work with our partners to understand their systems where they were what appropriate?
Actions were taken, but we weren't really at the point of making an actual decision on any of those for example
The waste contract so we know that there's a waste contract coming up for a new
But we're recommenced the work prior to our GR to understand what our
ways contract options are, but to specifically answer your questions, I'm not actually aware
of any decisions that we've paused or delayed specifically around our job, particularly
in regards to contracts and stuff.
That's great, thank you.
Cllr Alan Martin - 1:24:25
Paul -Elaine, any more for any more?
No.
Perfect.
So, that concludes Agenda Item 9.
And then the final item on the agenda.
This time our recommendations are to receive and note the report, to note the budget strategy
for 27 -28 as set out in the report, to note the draught proposed timetable for preparing
the budget in Appendix 1, and to note the proposed arrangements for public consultation.
So with all that said, if I can ask for a proposer?
Elaine.
and a seconder, oh, and a show of hands.
Great.
Well, thank you very much, everyone.
And that brings us to the end of today's meeting.