For the board to consider the Financial Strategy Work Programme.

[Papers to follow]

The report was introduced to the board, with particular attention being paid to the ‘Scrutiny Management Board Potential Areas of Focus’ table set out at Appendix 1. An overview was provided of the key topics of focus:

-          Reserves Policy

-          Service Savings Plans

-          Budget Consultation

-          Delivery of Capital Programme

-          Income and Charging

-          Quarterly Outturns

-          Treasury Management

-          Budget Scrutiny

It was explained that the report had been informed by guidance set out by the CfGS (Centre for Governance and Scrutiny) detailing how scrutiny boards and committees should be undertaking financial scrutiny of a councils’ financial operations and budget development cycles.

The Chair invited the board to discuss and comment on the report. The principal points of discussion are summarised below:

1.    A board member suggested that scrutinising budgets and account management on a quarterly basis was not frequent enough and should be being carried out on more regular basis.

·         The Cabinet Member Finance and Corporate Services welcomed the board’s interest in the finance portfolio and noted that finance was included in seven of the board’s scheduled meetings. The Cabinet Member suggested that this might indicate potential mission creep and noted that the board did have other responsibilities outside of the area of finance.

2.    The board members considered and discussed the potential need for a standing panel made up of members, who would track and follow the financial delivery of the Council by meeting up to review published quarterly reports and other financial documents - with a view to determining which appropriate topics could be drawn from the reports for the Scrutiny Management Board to address.  It was suggested that the panel could also monitor monthly budget reports coming out of each of the directorates.

3.    The board considered what additional training would be required by members, especially in relation to the scrutiny of financial items.

Action: The Head of Strategic Finance stated that they could produce some suggestions about training and topic briefings aligned to the board’s work programme.

4.    A board member contemplated whether items relating to savings within directorates could be delegated to the other scrutiny committees, which might remove some of the financial load identified earlier by the Cabinet Member Finance and Corporate Services.

5.    A board member suggested a potential recommendation that officers and the Cabinet look at other authorities to see what their financial plans were and how they shaped their revenue budgets in terms of the allocations that were made across the areas they were responsible for.

6.    The board raised concerns around the number of authorities and councils facing financial difficulties and going bankrupt, and sought assurance that Herefordshire Council was in a stable finical position.

7.    In response to the suggestion that the work programme was finance-heavy, a board member pointed out that the item being discussed was the Financial Strategy Work Programme, and that the Board had its own work programme that would include non-financial topics and items. It was suggested that some of the financial topics being discussed in the item might not be included in the board’s final work programme.

8.    The board noted that there was potential for problems to arise from a lack of alignment between its bimonthly meetings and the publication of quarterly budget reports, and stressed the need to align meetings with the financial calendar.

9.    A board member suggested that the Financial Strategy Work Programme be accepted as it was and that finer details within it could be debated and discussed in future meetings and work programming sessions.

The board discussed the recommendations that had been put forward during the meeting and unanimously approved the following recommendations:

Resolved

That:

a)    Scrutiny Management Board considers the draft terms of reference and work programme for scrutinising financial strategy and budget setting, and makes any amendments it wishes;

The committee considers

b) identifies topics of focus for the committee’s work

c)    further identifies training or topic briefing required to support their word

d)    Scrutiny Management Board adopts the draft terms of reference and work programme for scrutinising financial strategy and budget setting.