INTEGRATED PLAN PART B - STRATEGIC DIRECTION AND FINANCIAL CONSEQUENCES - Resources and Performance Portfolio - STRATEGIC DIRECTION AND ...
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INTEGRATED PLAN
PART B - STRATEGIC DIRECTION AND FINANCIAL
CONSEQUENCES
Resources and Performance PortfolioContents Page
Portfolio on a Page 178 - 179
Section 1: Future Strategic Direction
Key priorities for the portfolio over the period 2019/20 – 2022/23 180 - 181
Key pressures and challenges facing the portfolio for 2019/20 – 181 - 182
2022/23
Key projects/programmes that the portfolio will deliver 2019/20 – 182 - 185
2022/23
Benchmarking and other information used in setting Strategic
185 - 186
Direction and assessing service outcomes
Key Risks, mitigation and resilience plans 186 - 187
Section 2: Revenue Budget Information
Key Budget Movements:
o Technical Adjustments
o Exceptional Inflation 188 - 193
o Pressures
o Savings
Revenue Budget by Objective Area 194 - 197
Section 3: Capital Programme 198 - 202
IP Part B: Strategic Direction - Resources & Performance 177Resources & Performance Portfolio
Strategic Direction: Key services provided:
• To provide professional advice and insights, and the tools to deliver • Support services including; Assurance, Finance,
services and enable change HR, Improvement & Technology, Procurement,
Property, Legal, Democratic & Member services,
Communication and Policy support.
• Citizen focused services for Births, Deaths,
Marriages and Citizenship Services, Support to the
Key priorities and programmes:
Coroner, delivery of school meals through Herts
• Driving forward digital strategies to maximise the effectiveness of Catering Limited and the supplies service
digital solutions for the council and its clients. HertsFullstop
• Leading on an effective People Strategy to deliver a high performing,
engaged and committed workforce.
• Maximising the use of public sector assets to drive out efficiencies
and generate ongoing revenue streams. Key risks in achieving IP proposals:
• Driving forward further commercial opportunities for trading, • Changes in funding and grant announcements
procurement and contract management. • Volatility of and changes to local business rates
• Leading on enabling and developing a Smart, flexible and mobile system
workforce. • Council tax reforms and changes to council tax base
• Enable effective approaches of prevention and demand • Wider inflation, interest and borrowing rate risks
management. post Brexit
• Funding – Drive forward strategic financial planning and proactively • Ability to market assets and secure revenue
respond to the impact of proposed changes to Business Rates streams
(NNDR) and government funding.
• Continuing to attract, recruit and retain an effective
• Development of key transformation proposals. workforce
IP Part B: Strategic Direction - Resources & Performance 178Resources & Performance Portfolio
£m Net Revenue Budget Key Revenue Pressures:
140.0 • Robertson and Farnham House lease (part of
120.0 2017/18 IP) - £0.579m
100.0 • HBS – Network Print & Fleet Services - £0.423m
• Increased insurance premiums - £0.131m
80.0
• Legal support for G&I - £0.119m
60.0
2018/19 2019/20 2020/21 2021/22 2022/23
Key Budget Movements Key Revenue Savings Proposals:
2019/20 2020/21 2021/22 2022/23
TOTAL TOTAL TOTAL TOTAL • Reduction in energy costs - £1.128m
£000s £000s £000s £000s • Property and asset management - £0.523m
Technical Adjustment (13,049) (13,049) (13,049) (13,049) • Herts Fullstop ITT - £0.420m
• Rent from new care home - £0.249m
Service Specific Inflation 203 417 647 890 • Libraries PSM - £0.179m
• Further reduction in back office costs - £0.111m
Legislative 399 69 69 69
Other Pressures 9,560 6,044 11,191 14,630
TOTAL PRESSURES 9,959 6,113 11,260 14,699
Existing Efficiencies (963) (3,691) (5,640) (7,278)
Key Capital Schemes:
Existing Policy Choice (50) (50) (50) (50) • 25 by 20: Property Projects
New Efficiencies (3,068) (3,091) (2,945) (2,835) • Broadband Delivery Project Phases 2 & 3
TOTAL SAVINGS (4,081) (6,832) (8,635) (10,163) • Capital Maintenance Improvements and Annual
Programme of Minor Works
2019/20 2020/21 2021/22 2022/23
• ICT Refresh budget and Refresh Mobile
Capital Programme £000s £000s £000s £000s
Computing Devices
15,747 10,255 6,725 3,535
IP Part B: Strategic Direction - Resources & Performance 179Resources and Performance Portfolio: Future Strategic Direction
1 What are the key priorities for the portfolio over the period 2019/20 – 2022/23?
Resources provide centralised support services to the Council’s departments, as
well as providing front-line services including Registration, Coroners and Citizenship
Services and Herts Business Services. The Resources Directorate also includes
Libraries, as well as Performance and Improvement. Information on Libraries is
included in the Education, Libraries and Localism Portfolio.
The net total departmental budget for 2018/19 was £70.942m and £26.17m of
savings have been achieved between 2010/11 and 2018/19. A further £2.8m of
savings are already assumed in the baseline figures for 2019/20 rising to £8.4m by
2022/23.
A proportion of the service is carried out through third party providers and managed
under contract including pensions’ administration, payroll, occupational health, IT
support and development, HR and finance transactions, temporary staff
recruitment, facilities management and some property services (Leasehold and
empty property management & maintenance, valuation services, capital projects
delivery and project management). Approximately 35% of the gross Resources
budget is spent on these outsourced services.
Resources has a key role in supporting the Council’s departments to improve
services and make savings enabling the Council to continue to operate within
increasingly difficult financial circumstances. In key areas of the service such as
technology we will need to sustain the capacity of our teams in order to drive
change; this may increase the pressure to drive out savings in other areas of the
service to meet the authority’s funding gap.
The department’s strategic priorities are:
1) Providing corporate services to enable the delivery of departmental services and
projects
2) Delivering citizen services to support engagement, wellbeing and self-service
within the community
3) Leading on the future sustainability of the organisation through collaboration and
innovation and the delivery and support of major change initiatives
4) Leading on and promoting the existence of good governance in all aspects of the
organisation
IP Part B: Strategic Direction - Resources & Performance 180Our priorities over the medium term are to:
1. Be proactive enablers of change – providing leadership, direction and support
to drive transformation and improvement. This includes;
Effective delivery of new transformational change initiatives including Smart
Working, Next Generation and Future Workforce to support a sustainable
workforce and working environment.
Making the most of our property, office and service accommodation
portfolios, including through the Councils new property company, Herts
Living Ltd and Smart Working
Increasing commercial opportunities including those relating to major re-
procurements, and supporting the delivery of Smart Commercial and the
commercial strategy
Using outcome driven technology to respond to fast-changing digital
opportunities
Having a high performing, engaged, and committed workforce
2. Ensure that Resources Directorate meets the needs of the organisation,
provides best value for money and enables our frontline services to continue to
provide effective services. We will continue to review our structures and ways of
working to ensure that we are as efficient as possible and can effectively support
the changing needs of the organisation.
3. Proactively respond to and manage the proposed changes to government
funding and other policy changes, including the proposed devolution of Business
Rates.
4. Support the Council’s delivery of service led projects and programmes
5. Enable effective internal and external communication and engagement with
other citizens and partners
6. Managing the strategic partnership framework for the county – Hertfordshire
Forward – which brings together the key decision makers around the table to
secure common purpose.
7. Support and enable the role of Members.
2 What are the key pressures and challenges facing your portfolio for 2019/20 –
2022/23?
As the provider of Support Services to the organisation the Resources
Directorate needs to ensure that it responds to the ever changing needs of
departments whilst continuing to identify opportunities to deliver savings and
other efficiencies. This involves working with services to predict and respond to
the impact of demographic pressures and other policy changes, ensuring
continued effective and appropriate support services.
Ensuring that the organisation is able to use the best technology to improve
efficiency and productivity and engagement with its citizens. This will include use
of the most appropriate fit for purpose technology including cloud services and
ensure safe and effective transition of any changes. It will also involve
maximising digital opportunities with a user-focussed end to end service re-
IP Part B: Strategic Direction - Resources & Performance 181design, exploiting data analysis to tailor services and pre-empt trends and needs
and efficiencies around ways of working; as set out in the County Council’s
three-year Digital Roadmap.
Supporting the council in tackling the financial challenges outlined in the
Integrated Plan, and delivering financial sustainability over the medium term.
Responding to changes in funding; in particular the risks and opportunities
associated with changes to funding regimes including Business Rate
localisation. In addition, there is an increased risk of more schools becoming
Academies and insufficient funds to meet the needs of the remaining schools.
Ensuring that we support the organisation to develop a workforce strategy that
ensures that we maintain the capability and capacity to deliver current and future
outcomes and we continue to attract, recruit and retain people with the right
skills, abilities and values, particularly in key shortage skill areas including Social
Work, Planning, Digital and Legal.
Ensuring that we have the resources, knowledge and skills to support changes
in the way we operate, including the development of the property company
(Herts Living Ltd) and other commercial opportunities.
3 What are the key projects/programmes that the portfolio will deliver 2019/20 –
2022/23?
Procurement – ensuring we have effective procurement and contracts
management arrangements in place across the council. Enabling the effective
review and procurement of Directorate contracts; including the Shared Managed
Services (SMS), Temporary Staff Recruitment and Pension Fund contracts.
Spotting and engaging in opportunities for collaborative procurement with other
public sector partners.
Funding and financial planning – Resources will continue to support the
organisation in taking a strategic, medium term view of financial challenges faced
and developing option to meet these challenges. We will proactively responding to
proposed changes to Business Rates (NNDR) and central government funding to
ensure that the impact for HCC is understood and informs Medium Term Financial
Strategy. Working with our partners, we will ensure that the impact of any changes
(including local growth) are understood and reflected in the medium term financial
strategy.
Transformation – Develop and drive forward new transformational change
initiatives including Smart Working, Next Generation and Future Workforce to
support a sustainable workforce and working environment. Also ensuring there is a
holistic view of these and wider departmental change programmes
Assurance – The individual parts of the Service continue to consider opportunities
for expanding their customer base e.g. further work from Academies and other
Districts and Boroughs with a view to generating further revenue surplus
contributions or by reducing charges in relation to Partnership Services (SIAS &
SAFS).
IP Part B: Strategic Direction - Resources & Performance 182Legal Services – supporting the Council to achieve its objectives, particularly
providing specialist and focussed support for major initiatives, taking the opportunity
to develop shared service arrangements where appropriate, engagement with client
departments to manage in conjunction with them increasing demands for legal
advice and development of initiatives (e.g. on line resource hubs) to reduce the
reliance on Legal Services.
Information Governance – continue to support the Council with GDPR compliance
and access to information requirements.
Coroner Service - continued development of the case management system to
enable electronic referral of sudden deaths and electronic signing and distribution of
post-investigation documents to improve service to the bereaved and efficiency.
Prepare for the introduction of the non-statutory NHS Medical Examiner Service
April 2019.
Registration & Citizenship Service – continued development of customer online
appointment and ceremony booking, and development of online payment system to
improve customer service and service efficiency. Identifying further opportunities to
generate income to improve efficiency.
County Council Election 2021 – prepare for the County Council Election 2021
Customer Service - the new Hertfordshire.gov.uk website has been live for two
years, achieving best website award at the UK Public Sector Communications
Awards and the highest rating from society for IT manager in the public sector.
Priorities remain for its development to maximise the potential of channel shift
encouraging residents to self-serve rather than call the customer call centre; and to
develop more personalised content.
Financial and HR systems review – to prepare for the future withdrawal of support
for the current version of SAP systems in 2025, the Next Generation project is
looking for improvement and change to ensure that use of the core system
functionality is maximised, whilst also reviewing future options for systems and
process provision. The drivers will be to seek improvements and efficiencies for the
end user and bring about efficiencies from the process design.
Human Resources – will continue to contribute to internal and external major
change programmes. Support the review of HR and Payroll services in the lead up
to 2021 contract through Fit for the Future, Next Generation project.
Technology & Improvement – Drive completion of the Next Generation project by
March 2021 within the overall context of organisational transformation. Continue to
deliver the technology roadmap to enable new ways of working across the
organisation, which includes migration to Windows 10 and Office 365 by the end of
2019 and rollout of refreshed user hardware (starting with laptops) over the next 2
years.
Corporate Policy & Communications - Supporting services on policy and service
changes, building the County Council’s external profile, supporting the county’s
strategic partnership and joint working arrangements through Hertfordshire Forward
and the Public Sector Chief Executives Group and maintaining internal
communication with staff to support organisational change.
IP Part B: Strategic Direction - Resources & Performance 183Supporting the Organisation – supporting services to deliver their change
programmes and savings and where appropriate develop the capability and
capacity to deliver improved trading income and opportunities for partnership
working.
Leading on our property and office and service accommodation
To make better use of the public sector portfolio of assets by sharing buildings
and developing more multipurpose facilities, particularly in support of co-
delivered services. This is proposed to reduce costs and deliver better
outcomes wherever possible to staff and service customers. The council will
work with partners through the Hertfordshire Property Partnership and One
Public Estate programme.
In the context of Local Strategic Plans and the need for significant housing and
infrastructure development, to drive forward required development and return
with some or all of the profit component to the public sector or, through private
rented housing, to generate ongoing revenue income streams to support
spending on essential services. This approach will utilise the Council’s newly
established property company (Herts Living Ltd).
Leading on increasing commercial opportunities
Developing the Councils commercial strategy, including:
o Implement consistent and coherent approach to HCC companies, and
options for future arm’s length entities
o Developing guidance to support the organisation in considering commercial
opportunities
o Enhance approach to strategic commercial planning & re-tendering
o Benchmark contract management and commercial approaches.
Leading on outcome driven technology to respond to fast-changing digital
opportunities
Targeting service-specific agile redesign to maximise quick wins – the strategy is
delivery as set out in the three-year Digital Roadmap.
Encourage greater level of user-focussed end to end service re-design,
exploiting data analysis to tailor services and pre-empt trends & needs.
Deliver an effective technology infrastructure to underpin resilient digital first
approaches across the council.
Ensure a digitally confident and competent workforce.
Leading on an effective People Strategy to deliver a high performing, engaged,
and committed workforce
Ensuring our workforce has the capability and capacity to deliver current and
future outcomes.
Positioning HCC so that we are recognised as an employer of choice.
IP Part B: Strategic Direction - Resources & Performance 184 Developing reward frameworks that support us to attract, recruit and retain
people with the right skills, abilities and values.
Ensure Workforce plans are aligned with IP and service business plans.
Right person, right place doing the right thing.
Leading on developing and enabling SmartWorking throughout the organisation
Leading widespread cultural change to drive increased collaboration, mobility
and flexibility.
Delivering modern technologies to enable smarter ways of working as the new
normal.
Ensure close links to office estate consolidation, people strategy and digital
workstreams.
Supporting the right approaches to prevention & demand management
Working with services and partners to identify and analyse the quantum of
funding supporting prevention activity and the outcome of such spend.
Supporting the development of outcome measures and toolkits.
Key savings proposals include:
Resources Directorate has looked to reduce the costs of its operation, ensuring that
it is efficient and fit for purpose. Since 2010 it has delivered savings of £26.17m
rising to £31.79m by 2022/23. This included working with external partners to lever
out savings through more efficient ways of working and maximising the use of
available technology where appropriate. It continues to review opportunities for
efficiencies including reducing the use of our office space and joint working with
partners to share fixed costs and generate income.
The proposals set out in the IP cover:
Further reduction in back office costs – this includes savings across each of
the Resources teams - £0.304m
Additional income from traded and statutory services - £0.430m
Property and asset management, including energy - £2.180m
Serco SMS contract savings - £0.111m
Key to future savings will be the extent to which the Directorate can identify further
efficiencies from the key cross-cutting transformation programmes. In the short
term there may be a requirement for additional investment to support and drive the
transformational changes across the organisation.
4 How has the portfolio reviewed its effectiveness / value for money in
delivering service outcomes?
The service undertook a comprehensive review of the level and scope of its
services through joint work with Essex County Council, and ten other county
councils to inform the 2016/17 budget plan. This exercise identified that we
IP Part B: Strategic Direction - Resources & Performance 185compare relatively favourably on costs and scope of service spending 4.4% of our
gross budget on support service with only one of the 10 other councils spending a
lower proportion.
Subsequent to this a number of further exercises have been undertaken:
Legal Services – are part of the Public Law Partnership (PLP is the legal
services partnership of authorities in Essex, Hertfordshire, Suffolk and
Cambridgeshire). PLP share staff, legal information, know-how and training to
ensure value for money. Our aim is also to work closely with other legal
departments in Hertfordshire authorities to share training and, where
appropriate, resource.
SERCO– the outcome of a previous review undertaken by an independent
assessor revealed that the overall contract price across all service lines is 9%
below reference group average, and therefore continues to represent value for
money at the aggregate level. The Council has taken advantage of the
opportunity to extend the contract from March 2019 by 2 years. In doing so it has
been able to negotiate further savings on the contract, reducing cost not just in
Resources but in ACS and children’s services too.
Property services – the work to develop the approach to management and
development of property assets has involved research with external providers
and other organisations to determine options and best practice in this area. .
This can be achieved both through the implementation of the ‘Accommodation
Strategy’ and through working with “One Public Estate” to pump prime
collaboration across all Herts public sector.
Procurement – the Central Buying Consortium benchmarking exercise results
(published in early 2017) showed that of the 8 authorities participating,
Hertfordshire ranked the second from lowest for cost of service, despite having
the second from highest level of externally procured spend. Likewise, the
Society of County Treasurers procurement benchmarking exercise of 12
authorities (published in early 2017) ranked Hertfordshire lowest in terms of cost
of the central procurement team as a percentage of net revenue budget.
5 What are the key risks in delivering projects and programmes for this
portfolio, and what mitigations are in place? What steps are being taken to
ensure resilience?
Major budget related risks are set out in the Sensitivity Analysis (IP Part A –
Overview) with a number of these relating to this portfolio. In particular:
potential income from business rate incentives; success of the Local Enterprise
Partnership; impact of business rate appeals;
the Collection Fund balance and council tax base for future years, as well as
council tax support schemes and wider council tax reforms;
outstanding grant announcements;
inflation: non-pay inflation including exceptional inflation;
delivery of savings to timescale;
IP Part B: Strategic Direction - Resources & Performance 186 interest rates, impacting on borrowing costs and investment income;
ability to sell assets and secure capital receipts; and
potential impact of the decision to exit the EU on inflation, treasury
management, the property development market and staff recruitment and
retention.
Some of the key mitigations in place include:
Continuing to review and manage our overall resource position including
changes to grant funding.
Continued commitment to deliver savings through robust project management
and ensuring the focus remains on key priorities.
The availability of contingency funding which alongside general fund and
specific reserves takes account of the uncertainties and risks across the
organisation.
Continued leadership of cross-cutting transformation programmes to support
transformation change across the organisation and deliver future savings.
Workforce planning and strategy to ensure that we recruit, engage and retain a
highly performing workforce and deal with key skill shortage areas.
IP Part B: Strategic Direction - Resources & Performance 187KEY BUDGET MOVEMENTS 2019/20 - 2022/23
2019/20 2020/21 2021/22 2022/23
TOTAL TOTAL TOTAL TOTAL
£000s £000s £000s £000s
Technical Adjustment (13,049) (13,049) (13,049) (13,049) TA
Service Specific Inflation 203 417 647 890 SSI
Legislative 399 69 69 69 L
Other Pressures 9,560 6,044 11,191 14,630 OP
TOTAL PRESSURES 9,959 6,113 11,260 14,699
Existing Efficiencies (963) (3,691) (5,640) (7,278) EE
Existing Policy Choice (50) (50) (50) (50) EPC
New Efficiencies (3,068) (3,091) (2,945) (2,835) NR
TOTAL SAVINGS (4,081) (6,832) (8,635) (10,163)
Approximate
Type of budget 2019/20 2020/21 2021/22 2022/23 current
Ref Description Dept TOTAL TOTAL TOTAL TOTAL budget
movement
£000s £000s £000s £000s £'000
Technical Adjustments
Technical
TA6 Herts Fullstop - Invest to transform and increased revenue (reversal of one-off expenditure) Central Items (112) (112) (112) (112) (1,697)
Adjustment
Technical
TA7 SEND Preparation for Employment Grant 2018 (reversal of one-off expenditure in 2018/19 IP) Resources (160) (160) (160) (160) N/A
Adjustment
Technical
TA8 Adult Social Care Support Grant (reversal of one-off expenditure in 2018/19 IP) Resources (2,584) (2,584) (2,584) (2,584) N/A
Adjustment
Technical
TA9 Review of contingency (reversal of one-off expenditure in 2018/19 IP) Resources (1,961) (1,961) (1,961) (1,961) N/A
Adjustment
Infrastructure & Sustainable Transport Investments (reversal of one-off expenditure in 2018/19 Technical
TA10 Resources (2,000) (2,000) (2,000) (2,000) N/A
IP) Adjustment
Technical
TA11 Insurance Reserve (reversal of one-off expenditure in 2018/19 IP) Resources (1,000) (1,000) (1,000) (1,000) N/A
Adjustment
Technical
TA12 Invest to Transform fund (reversal of one-off expenditure in 2018/19 IP) Resources (5,232) (5,232) (5,232) (5,232) N/A
Adjustment
Service Specific Inflation
Coroner Services
Service Specific
Mortuary Service These services are provided by NHS Trusts and therefore will be subject to Resources 4 9 15 21
Inflation
NHS inflation.
Coroner Services
Service Specific
Special & High Risk Examinations These services are provided by NHS Trusts and therefore Resources 2 5 8 11
Inflation
will be subject to NHS inflation.
Assurance Services
SIAS & SAFS HCC Commissioning SAFS are planning to increase their charge to Partners by Service Specific
Resources 10 21 32 43
2% a year & SIAS are planning to increase their charge to Partners by 1.5% a year. The Inflation
composite % increase is 1.58%
IP Part B: Strategic Direction - Resources & Performance 188Approximate
Type of budget 2019/20 2020/21 2021/22 2022/23 current
Ref Description Dept TOTAL TOTAL TOTAL TOTAL budget
movement
£000s £000s £000s £000s £'000
Legal Service Specific
Resources 8 12 17 21
Records Management Consumer Price Inflation required for the Off-Site Storage Contract. Inflation
Insurance Service Specific
Resources 10 28 56 95
Insurance Claims Insurance Claims paid by HCC up to our excess level. Inflation
Insurance Service Specific
Resources 36 72 109 148
Insurance Premiums Increase in insurance premiums Inflation
Registration & Citizenship Service Service Specific
Resources 4 8 13 17
Citizenships Ceremony Statutory fees Inflation
Registration & Citizenship Service Service Specific
Resources 13 27 41 55
General fees income Statutory fees Inflation
Property Service Specific
Resources 7 15 23 31
Abel Smith rental income Lease agreement with 0% inflation Inflation
Property
Service Specific
Residential Elderly People's Homes Lease agreements are fixed for a period of 5 years with no Resources 109 220 333 448
Inflation
allowance for inflation
Pressures
Domestic Abuse - reserve set-up
L5 Specific reserve set up to deliver the domestic abuse agenda in the light of new legislative Central Items Legislative 330 - - - -
requirements.
Interest cost - New Long-Term Borrowing
OP10 Interest cost increase due to the borrowing required to fund the rest of HCC's capital Central Items Other Pressures (763) 100 2,279 4,879 21,010
programme not funded by grants, contributions or reserves.
Interest cost - HCC Short Term Loans
OP10 Interest cost increase due to increased use of short-term loans to fund capital programme in Central Items Other Pressures (167) 276 1,324 369 21,010
short-term, and manage liquidity requirements
Brokerage and Fee Expense - Arrangement of New Borrowing
OP10 Additional fee expenses incurred for the arrangement of new borrowing required to fund HCC's Central Items Other Pressures (3) 56 92 104 21,010
Capital Programme
Interest on Balances held Internally
OP11 Increase in internal interest paid on balances held due to higher interest rates forecast. Some Central Items Other Pressures 247 116 109 25 21,010
mitigation is expected from the reduction in LEP balances.
Minimum Revenue Provision
OP12 As a result of moving the calculation of the provision to the annuity method the savings Central Items Other Pressures 175 175 175 175 21,010
generated are front loaded and creates a pressure in future years.
Additional Borrowing to fund the Capital Programme
Borrowing to fund the Capital Programme results in a higher minimum revenue provision. The
OP13 Central Items Other Pressures 1,538 3,704 5,411 7,084 21,010
minimum revenue provision is the statutory amount that HCC must charge to council tax in
order to repay the principal on borrowing.
Review of contingency
OP59 Central Items Other Pressures 2,709 - - - 6,022
Additional funding used to help manage the wide range of financial and operational risks
IP Part B: Strategic Direction - Resources & Performance 189Approximate
Type of budget 2019/20 2020/21 2021/22 2022/23 current
Ref Description Dept TOTAL TOTAL TOTAL TOTAL budget
movement
£000s £000s £000s £000s £'000
Environment Agency Thames/Anglian Region Levy
The Environment Agency is a levying body for its flood defence function under the Water
OP66 Central Items Other Pressures 17 17 17 17 978
Resources Act 1991. Following notification of the levy for 2019/20 an increase in budget is
required.
Corporate Transformation
OP60 A dedicated reserve for collaborative, corporate transformation to meet the anticipated future Central Items Other Pressures 1,000 - - - N/A
cost of organisational change (beyond the provisions made via the ITT fund)
Loan Premium Expense
OP62 Pressure resulting from the amortisation of loan premium incurred during 2018/19 as a result of Central Items Other Pressures 168 168 168 168 21,010
the early repayment of LOBO loans
OP63 Invest to Transform Central Items Other Pressures 2,033 - - - N/A
Contribution to the Invest to Transform Fund
Business Rates Pilot Reserve
OP64 The anticipated benefits of the business rates pilot is being set aside in a dedicated reserve to Central Items Other Pressures 1,308 - - - N/A
be applied to promote economic growth, in line with the objectives of the rates retention pilot
OP65 Business Rates Pilot Reserve - top-up Central Items Other Pressures 90 - - - N/A
Climate Change Levy
L10 Additional CCL on the unit price of energy following the removal of the Carbon Reduction Credit Resources Legislative 69 69 69 69 3,696
scheme from 2019/20 - See associated saving for CRC (£219k)
Robertson & Farnham House
At the point of purchase of the freehold of Robertson and Farnham House in Stevenage, Aviva
held a lease of the freehold with HCC subleasing from Aviva. This situation continues until the
Aviva lease expires in September 2018. However, there is a difference in the values of the
OP7 lease (£3.5m) and the sublease (£2.3m) of £1.168m which in turn will create a pressure on the Resources Other Pressures 579 579 579 579 579
overall property budget when the Aviva lease ends. As Aviva do not make profit from this
arrangement they will not look to renew the lease. A pressure of £589k was included in the
2018/19 budget due to the lease ceasing in September 2018. The current pressure of £579k is
the remainder of the full year effect.
Network Print Service
The Network Print Service and associated budgets have transferred to Technology. This has
OP38 Resources Other Pressures 173 173 173 173 (173)
left HBS with a pressure of £173,300 per annum due to previous budgeted over-recovery of
costs.
Lease Car rebate
OP42 Cross cutting pressure arising from a sharp fall in the lease care rebate estimate across all Resources Other Pressures 100 105 100 100 (236)
departments with Lease cars.
IP Part B: Strategic Direction - Resources & Performance 190Approximate
Type of budget 2019/20 2020/21 2021/22 2022/23 current
Ref Description Dept TOTAL TOTAL TOTAL TOTAL budget
movement
£000s £000s £000s £000s £'000
Insurance Premiums
Early warning from our insurance brokers that our insurers may be looking to breach the Long
OP49 Resources Other Pressures 131 323 512 705 1,688
Term Agreement in September (our renewal) and increase the insurance premium/require us to
take a higher excess. This is due to an alleged worsening in our claims experience.
Herts for Learning (HfL)
Move away from SAP onto an alternative ERP. This would mean that they would no longer pay
OP50 for SAP support, SAP licences (except for a small charge associated with running their payroll) Resources Other Pressures 75 102 102 102 (345)
or Finance Transactions. These are all currently paid for by the SMS budget, which also
receives the recharged income. (Draft figures)
OP51 Fleet Services Resources Other Pressures 150 150 150 150 (243)
Savings
Minimum Revenue Provision Existing
EE65 Central Items 4 (9) (9) (9) 21,010
Final savings arising from 2017/18 change to MRP policy Efficiencies
Better Contract Management Existing
EE66 Central Items - (500) (1,000) (1,000) N/A
Efficiencies
NE23 Internal Commissioning Central Items New Efficiencies (910) (910) (910) (910) N/A
Interest on Investment Balances
NE24 Changes in interest earned on external balances resulting from changes in forecast balances Central Items New Efficiencies (529) (546) (400) (290) 21,010
and interest rate forecast.
Engagement and Consultation Phase 2
Existing
EE50 This saving relates to the ceasing of the residents' survey so that it only takes place every other Resources (21) - (21) - 21
Efficiencies
financial year.
Registration & Citizenship Service
Further channel shift to online bookings and payments reducing telephone booking, including Existing
EE51 Resources (40) (40) (40) (40) 2,038
completion of ecommerce project and development of Ceremony Planner functionality in NEO Efficiencies
(Registrations booking system).
Democratic Services
Existing
EE52 Electronic publication and distribution of agendas, reports and minutes of formal meetings of Resources (20) (20) (20) (20) 34
Efficiencies
the council.
Property review and rationalisation
Existing
EE53 This initiative is focussed on delivering a reduction in the costs of office accommodation by Resources (523) (995) (256) (1,915) 9,025
Efficiencies
2020, which includes a drive towards freehold ownership of property.
IP Part B: Strategic Direction - Resources & Performance 191Approximate
Type of budget 2019/20 2020/21 2021/22 2022/23 current
Ref Description Dept TOTAL TOTAL TOTAL TOTAL budget
movement
£000s £000s £000s £000s £'000
Herts Fullstop - Invest to transform and increased revenue
The business plan for next year focuses on increasing sales income to reduce the pressure Existing
EE54 Resources (420) (657) (909) (909) (1,697)
currently , before a planned Invest to transform bid for around £1.5m of investment would Efficiencies
increase the surplus generated. the saving is dependent on this investment.
Prop Co
An initial estimated of returns from the councils property company (Herts living Ltd) has been Existing
EE55 Resources - (1,000) (2,500) (2,500) -
undertaken. This will be revised once discussions can take place with the preferred bidder for Efficiencies
the joint venture (Chalkdene)
Corporate Communications: Horizons - Transition to online
Existing Policy
EPC10 Reduce Horizon publications from 3 copies to 2 in 18/19 and then further reducing to one copy Resources (50) (50) (50) (50) 142
Choice
in 19/20.
Customer Service – Web Team Existing
EE56 Resources (10) (30) (30) (30) 608
Increasing income by delivering web tools and support for other organisations. Efficiencies
Customer Service - Income and Payments
To drive out further savings through efficiencies in how the team work, developing more self-
service and making better use of systems.
Existing
EE57 Resources (60) (150) (170) (170) 1,271
Efficiencies
Developing and implementing a customer portal so that customer can access their own
information and submit documentation, thereby reducing the numbers of manual processes that
the team carry out.
Serco SMS contract savings
Negotiation has been undertaken with Serco regarding the possible extension of the Shared
Managed Services contract by 2 years to March 2021. This will contribute a saving rising to Existing
EE16 Resources (111) (118) (92) (92) 11,359
£1.1m per annum by 2019/20 (including £300k in relation to current glide path savings). These Efficiencies
savings benefit Resources, ACS and Children's Services, and as such the remainder of savings
appear in those departments
Trading: Herts Catering Ltd
Existing
EE59 Performance from HCL means the Council can expect additional income in the coming years. Resources 200 - (200) (200) (1,000)
Efficiencies
This could be a mix of dividend income and fees for services that HCC provides to HCL
HR stretch target
Existing
EE60 Following the outcomes of the SAP review, HR/Finance will look to develop plans for service Resources - (73) (184) (184) 3,713
Efficiencies
redesign and efficiency to deliver savings
Finance stretch target
Existing
EE61 Following the outcomes of the SAP review, HR/Finance will look to develop plans for service Resources - (73) (183) (183) 4,344
Efficiencies
redesign and efficiency to deliver savings
Existing
EE62 Property - utilities - non-schools Salix savings Resources (28) (92) (92) (92) 3,696
Efficiencies
Existing
EE63 Reprocurement of external audit fee via Public Sector Audit Appointments (PSAA) Resources (17) (17) (17) (17) 147
Efficiencies
IP Part B: Strategic Direction - Resources & Performance 192Approximate
Type of budget 2019/20 2020/21 2021/22 2022/23 current
Ref Description Dept TOTAL TOTAL TOTAL TOTAL budget
movement
£000s £000s £000s £000s £'000
Reserve balance Existing
EE64 Resources 83 83 83 83 -
Review of department reserves to release any that no longer need to be held Efficiencies
Property - Energy Savings
Historically the energy budgets have not been adjusted to reflect any differences between actual
inflation and the estimated inflation from the previous year's IP which has resulted in a surplus
NE13 Resources New Efficiencies (1,128) (1,128) (1,128) (1,128) 3,696
budget for energy. The adjustment to reflect the difference between the estimated inflation and
actual inflation is now being undertaken - Figures are being investigated further to verify the full
assumptions behind it, and to confirm whether there is any element of a reduction in usage
Carbon Reduction Credits
NE14 The CRC scheme ceases from 2019/20 to be replaced by additional Climate Change Levy on Resources New Efficiencies (219) (219) (219) (219) (219)
the unit price of energy - See associated pressure for CCL (£69k)
Fire ladder workshop
End of lease at Mallow Park for the Fire ladder workshop. Workshop to be temporarily
NE15 relocated to either an alternative workshop hired locally or possibly to Hertford Fire Station, with Resources New Efficiencies (33) (39) (39) (39) 899
the intention of moving the workshop to Longfield in the long term. Saving is based on hiring an
alternative workshop locally whilst a decision is made
Bericot Way rent
NE16 The Quantum Care residential elderly care home in Bericot Way, Welwyn Garden City is now Resources New Efficiencies (249) (249) (249) (249) (5,331)
paying income to HCC, as the rent free agreement under their lease has now come to an end.
Note 1
A number of pressures and savings impact on a several portfolios. The total amounts across all portfolios is given here:
OP42 Lease Car Rebate - AC&H, CYP&F, R&P 254 525 537 520
NE3 Children's Services Efficiencies CYP&F, EL&L (500) (500) (500) (500)
IP Part B: Strategic Direction - Resources & Performance 193ANALYSIS OF REVENUE BUDGET BY OBJECTIVE AREAS
Net Gross Net Net Net Net
Budget Budget Budget Budget Budget Budget
2018/19 2019/20 Income 2019/20 2020/21 2021/22 2022/23
£'000 Objective Area £'000 £'000 £'000 £'000 £'000 £'000
Resources
Resources Central Items
This budget includes:
Chief Executive: - Overall corporate management and operational responsibility, including management responsibility for all
1,238 officers. 1,571 (87) 1,484 1,485 1,485 1,485
Director of Resources & Performance: - Oversee the strategic management of the department, ensuring compliance with legal
and regulatory frameworks and the delivery of Statutory Services.
Herts Finance
Give strategic advice and support to key financial processes. This includes the preparation of the annual revenue and capital
budgets, setting and monitoring financial standards and providing finance and accountancy support functions to all council
4,168 5,039 (523) 4,516 4,448 4,333 4,333
services. This budget also includes the payment of charges on banking transactions and external audit fees. Other Services -
includes budgets for car loans and staff mortgages and other miscellaneous items.
Herts HR
Development of corporate people strategy and policies, workforce planning, learning and organisational development, pay and
3,649 reward, employee and industrial relations, equality and diversity in employment, employee well being, recruitment and 5,144 (1,358) 3,786 3,713 3,602 3,602
retention, safe staffing, talent and succession management, leadership and management development.
Shared Managed Services
Provides overall Contract Management for the SMS contract for all operational services provided under the partnership,
12,930 14,450 (2,512) 11,938 11,958 11,984 11,984
regardless of service type.
Improvement and Technology
- Provides the strategic lead and design function for IT and telecommunications infrastructure across the authority.
- Delivers and champions the effective use of, management information and performance data for HCC departments,
corporate management and partnership purposes.
- Delivers improvement programmes and project management for key authority wide and departmental initiatives ensuring
10,549 12,765 (2,626) 10,139 10,139 10,139 10,139
Equalities and Diversity issues are effectively addressed.
- Supports the organisation's Data Protection, Freedom of Information, Open Data and Records Management activity.
- Supports the organisation's commissioning and procurement activity providing technical support, supplier relationship advice
and best practice advice to enable effective, value for money contracting.
IP Part B: Strategic Direction - Resources & Performance 194Net Gross Net Net Net Net
Budget Budget Budget Budget Budget Budget
2018/19 2019/20 Income 2019/20 2020/21 2021/22 2022/23
£'000 Objective Area £'000 £'000 £'000 £'000 £'000 £'000
Property
Property Teams: - Provide the strategic asset management and advice function in support of land, buildings and other property
assets owned or leased by the County Council. Act as the Corporate Client for outsourced property services including property
lease and managing agent function, property and land specialist consultancy services, property & land disposals and
acquisitions services. Deliver Development Services function for county assets (planning permissions), responses to District
Council Strategic Land Use Plans and negotiates S106/CIL infrastructure development funding agreements.
Central & Shared Buildings - This budget covers the facilities management and running costs for all shared offices (County
Hall, Apsley, Stevenage and Mundells), as well as certain other divisional buildings throughout the county. It is managed by
Property and all costs are recovered by recharges to the building occupiers.
15,758 31,787 (16,670) 15,117 13,693 13,053 11,517
Service Property Costs - Property are responsible for the provision of 'hard' Facilities management (reactive and planned
maintenance works) across the majority of operational service properties, e.g. the libraries, fire stations etc.
Corporate Managed Properties - This budget covers the management of all properties that are not being used for direct
services delivery by the county council, including those in the property disposal programme.
Staff Housing Pool - Managed by Aldwyck Housing Association, this provides staff temporary housing and provides an income
that is used to pay for the repairs and maintenance of the properties.
Assurance (Internal Audit, Scrutiny and Health & Safety)
Internal Audit - Internal Audit gives assurance to members and senior managers on all the Council's governance, risk
management and internal control arrangements, so as to ensure that these key areas work effectively to deliver council
objectives.
Counter Fraud - Counter fraud activity delivered by the Shared Anti Fraud Service; pro-active and re-active work to prevent
and detect fraud
298 1,787 (1,462) 325 335 346 357
Scrutiny - Scrutiny has the responsibility to hold the Executive to account by scrutinising decisions made by, or on behalf of the
Council or Cabinet, and any operational or policy aspect of the council's business. It also has the power to scrutinise health
services.
Health and Safety - The team delivers strategic and operational Health and Safety advice and guidance, with a risk-based
model of service delivery.
IP Part B: Strategic Direction - Resources & Performance 195Net Gross Net Net Net Net
Budget Budget Budget Budget Budget Budget
2018/19 2019/20 Income 2019/20 2020/21 2021/22 2022/23
£'000 Objective Area £'000 £'000 £'000 £'000 £'000 £'000
Legal Services & Statutory Services
Legal Services - Provide high quality legal and administrative services to enable the County Council to carry out its policies
and statutory obligations within the law and the council’s own procedures in a cost effective manner.
Highway Boundaries & Land Charges Unit - The Highway Boundaries and Land Charges Unit undertake searches on behalf of
district councils, solicitors, and members of the public into inquiries about the status of roads, rights of way, and other highway
matters. They also answer enquiries relating to common land.
Elections - The elections budget represents the budget needed to pay for any by-elections in year, and to fund the cycle of
county council elections which take place every four years.
Democratic Services - This team is responsible for supporting county councillors to carry out their formal duties as councillors.
5,593 10,034 (3,689) 6,345 6,376 6,407 6,439
It is responsible for arranging and supporting all of the council's formal meetings, including County Council and Cabinet
meetings, and ensuring that an accurate record of these is maintained.
Coroners Service - The Coroner Service provides administrative and investigatory services to Her Majesty’s Coroner for the
district of Hertfordshire, in accordance with the responsibilities of the relevant authority as defined in the Coroners and Justice
Act 2009. The service investigates sudden or unexpected deaths.
Registration & Citizenship Service - Hertfordshire Registration & Citizenship Service is responsible for registering births,
deaths, marriages and civil partnerships, and citizenship services in Hertfordshire. The services provided include weddings,
civil partnerships, civil funerals, civil namings, citizenship ceremonies, nationality & settlement checking services, change of
name deeds and reaffirmation of vows.
Hertfordshire Business Services
Hertfordshire Business Services comprises of the following sections:
• Hertfordshire Contract Management Services
• Hertfordshire Supplies
(1,699) 8,159 (9,855) (1,696) (1,933) (2,186) (2,185)
• Hertfordshire Fleet Management Services (HFMS)
• Hertfordshire Reprographics
• Surecare Supplies
Insurance
The insurance costs of the County Council are met through this budget. These costs include external insurance premiums
3,903 paid, an amount set aside each year to meet the internally insured claims and excesses on externally insured claims, and the 4,098 - 4,098 4,345 4,600 4,870
operational cost of running the County Council’s insurance service.
Care Payments
1,226 The care payments team make payments to care providers and citizens paying for their own care. 1,397 (147) 1,250 1,250 1,250 1,250
Corporate Policy
Corporate Policy is concerned with analysing national policy developments, research studies and best practice to support the
2,794 formulation of policy across the county council. This includes leading on the corporate plan, the localism agenda and the 2,816 2,816 2,837 2,816 2,837
coordination of policy consultation.
Communications
Communications aims to increase awareness of county council services through effective communication with residents,
944 stakeholders and other target audiences. It is responsible for developing and implementing the council’s corporate and 1,029 (99) 930 929 929 929
departmental communications strategies.
IP Part B: Strategic Direction - Resources & Performance 196Net Gross Net Net Net Net
Budget Budget Budget Budget Budget Budget
2018/19 2019/20 Income 2019/20 2020/21 2021/22 2022/23
£'000 Objective Area £'000 £'000 £'000 £'000 £'000 £'000
Customer Services
The Customer Service team are responsible for managing the Serco contract for the Customer Service Centre including Blue
518 Badge service, leading on our website www.hertsdirect.org , providing the complaints service for Children Services and Health 1,015 (414) 601 491 471 471
and Community Services and delivering the school appeals service.
Herts Catering Limited Dividend
Hertfordshire Catering Ltd is a commercial company wholly owned by HCC, providing the majority of school meals in
(1,000) - (800) (800) (1,000) (1,200) (1,200)
Hertfordshire.
60,869 Resources Total 101,091 (40,242) 60,849 59,066 58,029 56,828
Central items
Capital Financing
9,060 Represents the Minimum Revenue Provision (MRP) charge to revenue to provide for the repayment of borrowing. 10,012 - 10,012 13,530 18,500 21,830
Interest Paid and Received
The cost of interest paid on borrowing, to fund the Capital Programme and any short term cashflow needs, together with
11,950 11,668 - 11,668 11,520 11,659 11,685
interest earned from investing the councils' cash balances.
Contingency
This budget provides for potential cost increases in areas of risk/uncertainty. Level to be confirmed once final funding figures
6,022 6,770 6,770 4,061 4,061 4,061
available in February.
One-off Investment
Infrastructure & Sustainable Transport Investments - Provision to fund projects for development of major infrastructure and
2,000 - - - - - -
sustainable transport to address future growth
5,232 Invest to Transform fund - Additional funding recognises the need for further transformation to deliver future savings 2,033 - 2,033 - - -
Corporate Transformation - A dedicated reserve for collaborative, corporate transformation to meet the anticipated future cost
- 1,000 - 1,000 - - -
of organisational change (beyond the provisions made via the ITT fund)
Lee Valley Regional Park and Environment Agency levies
The county council has to contribute to the funding of these two organisations.
2,046 • The Lee Valley Regional Park Authority develops, preserves and manages an area next to the River Lee as a regional park. 2,063 - 2,063 2,063 2,063 2,063
• The Environment Agency issues a local levy to the county council to fund flood defence.
Other
9,335 Includes inflation for pay awards still under negotiation and future years inflation 629 629 9,870 19,009 28,580
Transfer to Reserve
5,960 Creation of a Transition Reserve in 2018/19 - - - - - -
Creation of a new Business Rates Pilot Reserve following confirmation of the Hertfordshire 75% Business Rates Retention
- 1,398 1,398 - - -
Pilot
51,605 Central Items Total 35,573 - 35,573 41,044 55,292 68,219
112,474 Resources & Performance Total 136,664 (40,242) 96,422 100,110 113,321 125,047
IP Part B: Strategic Direction - Resources & Performance 197Resources and Performance capital programme 2019/20-2022/23
The total capital programme 2019/20 to 2022/23 for the portfolio is £36.262m and for
2019/20 is £15.747m. This includes all new bids and re-programming from 2018/19
at the end of quarter 2.
2019/20 2020/21 2021/22 2022/23 Total
£’000 £’000 £’000 £’000 £’000
HCC funding 12,337 3,580 3,050 3,160 22,127
Reserves 1,403 375 3,675 375 5,828
Grants 1,400 800 - - 2,200
Contributions 607 5,500 - - 6,107
Total 15,747 10,255 6,725 3,535 36,262
New capital bids
There are three new bids for Resources and Performance, as set out in the table
below.
Total Total
Total
HCC Other HCC other
Cost cost
funding funding funding funding
Scheme 2019/20 2019/20- Description
2019/20 2019/20 2019/20- 2019/20 -
2022/23
2022/23 2022/23
£’000 £’000 £’000 £’000 £’000 £’000
The targeted aim of
phase 3 is to extend
superfast further across
Broadband the county with
Delivery Project 1,400 - 1,400 11,000 - 11,000 particular emphasis on
Phase 3 positive economic
impact by providing
superfast speeds to
rural business premises.
Investment in
Transformation
transformation to secure
Schemes 500 500 - 500 500 -
long term revenue
benefits
Development of the e-
Systems
commerce solution and
Development 800 800 - 800 800 -
Enterprise Resource
Planning system
Total 2,700 1,300 1,400 12,300 1,300 11,000
IP Part B: Strategic Direction - Resources & Performance 198Revised capital bids
The directorate has revised fours bids. In total these require additional HCC funding
of £4.837m in 2019/20 to 2022/23.
HCC Other
HCC Other Total
Total funding funding
funding funding Increase/
increase/ increase/ increase/
Scheme increase/ Increase/ (decrease)
(decrease) (decrease) (decrease) Reason
(decrease) (decrease) 2019/20 to
2019/20 2019/20 to 2019/20 to
2019/20 2019/20 2022/23
2022/23 2022/23
£’000 £’000 £’000 £’000 £’000 £’000
Additional budget
required for the
replacement of laptops
and desktop terminals
to ensure the Council
ICT
has up to date and fit
Refresh 2,003 2,003 - 2,403 2,403 -
for purpose end user
Budget
devices, to support
SMART working
initiatives and the
property rationalisation
program.
Rural
Increased investment
Estate
required to improve
Annual 696 696 - 2,634 2,634 -
and maintain the
Capital
estate.
Programme
To enable the targeted
renewal and refresh of
25 by 20 250 250 - 250 250 - office designs to
achieve 25 by 20
savings.
County Hall Additional remedial
Car Park 400 400 - 400 400 - works required at
Works County Hall car park.
Total 3,349 3,349 - 5,687 5,687 -
IP Part B: Strategic Direction - Resources & Performance 199Resources and Performance portfolio capital programme 2019/20 - 2022/23
Total 2019/20 Integrated Plan 2020/21 2021/22 2022/23
Scheme scheme Cost HCC Reserves Grants Contribu Cost Cost Cost
New (N), existing (E), revised (R), Portfolio cost Funding tions
re-profiled (P) £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Broadband Delivery Project
Phase 2 (P)
Phase 2 of a programme that is to
ensure that 97% of Hertfordshire Resources
R1 premises (residential and and 14,352 3,051 1,416 1,028 - 607 - - -
business) can receive access to Performance
superfast broadband. This is a
joint project with
Buckinghamshire.
Broadband Delivery Project
Phase 3 (N)
The targeted aim of phase 3 is to
extend superfast further across Resources
R2 the county with particular and 11,000 1,400 - - 1,400 - 6,300 3,300 -
emphasis on positive economic Performance
impact by providing superfast
speeds to rural business
premises.
Non-Schools Capital
Maintenance and Minor Works
(E)
To maintain the condition of the
Resources
properties, so that they are Annual
R3 and 1,750 1,750 - - - 1,750 1,750 1,750
suitable for operational use. Programme
Performance
These sites include Libraries,
Adult Care, Registration, Fire and
Rescue stations with houses and
the Central and Shared Offices.
IP Part B: Strategic Direction - Resources & Performance 200You can also read
