Agenda and minutes

Apologies for absence were received from James Bromiley-Davis, Deputy Christopher Hayward, Wendy Hyde, Elizabeth King, Deputy Brian Mooney, Tom Sleigh, and James Tumbridge.

There were no declarations of interest.

The Town Clerk to be heard.

Sir Michael Snyder moved a Vote of Thanks to Jamie Ingham Clark, the immediate past Chairman.

RESOLVED UNANIMOUSLY: That the Members of this Committee take great pleasure in expressing to

JAMIE INGHAM CLARK

For the able manner and good humour in which he has presided over their deliberations and the detailed attention and interest he has shown in all aspects of the work of the Finance Committee for the past year.

Jamie has overseen a challenging time for the Corporation’s finances with reductions in government funding, COVID pressures, and uncertain times for the British Economy.

The impact of COVID on the Corporation’s finances has been significant. One of the first casualties was the demise of the pan London Business Rates Pool due to lower rates collection across London. This pool was at the heart of London’s fiscal devolution.

However, out of the ashes Jamie secured, with the then Chair of Policy and seven neighbouring local authority partners a successful application to create an Eight Authority Pool- with the aim of keeping £35m of rates raised in London, in London. 

In his year as Chairman, Jamie also ably oversaw a 12% savings programme, in response to the damage to our income streams from the pandemic, ensuring that our medium-term financial plans can continue to support the City’s ambitious plans, including Destination City and the three major projects, namely, the Museum move, the combined courts, and the consolidation of our markets on a single site in Barking; in addition, working alongside the Chair of Policy and fellow Committee Chairmen, he ensured that resources were realigned to fund the Corporation’s ground-breaking Climate Action Strategy.

Jamie’s legacy is one of being tough on spending – ‘the envelope is the envelope’ was one of his mantra’s, but with pragmatism and a heart for protecting

To agree the public minutes and non-public summary of the meeting held on 3 May 2022.

RESOLVED – that the public minutes and non-public summary of the meeting held on 3^rd May 2022 be approved as an accurate record.

Under matters arising, a Member highlighted that further to the request per item 9 on page 11, the risk scoring matrix methodology had yet to be circulated to the Committee; the Chamberlain responded that she would ensure this information was provided to Members after the meeting.

Separately, a Member asked whether, per item 11 on page 12, the grant from City’s Cash of £730,897 to the Housing Revenue Account had been paid yet; the Chamberlain responded that this sum was provided to underwrite the HRA should the claims be made and the criteria for payments be met; she proposed that an update Report be submitted from the Department for Community and Children’s Services (DCCS) to Finance Committee in six months’ time. 

The Chairman informed Members that, further to discussions at the recent meeting of the Policy & Resources Committee, he now had greater flexibility to delegate some of the roles on other Committees to which he is appointed to by dint of his position as Chairman of the Finance Committee.   

As a result, Nick Bensted-Smith has now been appointed to the Civic Affairs Sub-Committee in the Chairman’s stead.  

Report of the Chamberlain.

The Committee received a Report of the Chamberlain concerning the Committee’s Forward Plan.

The Chamberlain proposed that, given the introduction of the Digital Services Committee as a stand-alone Grand Committee after the recent Governance Review, the IT Division quarterly updates should no longer come to the Finance Committee. She also proposed that the two remaining quarterly updates with Finance Committee oversight, namely, the Chamberlain’s Business Plan Quarterly Update and the City Procurement Quarterly Update be amalgamated and submitted on a quarterly basis at the Finance Committee meetings in January, April, July, and October. The Committee supported these proposals.

RESOLVED – that the Committee noted the Report.

Report of the Town Clerk.

The Committee considered a report of the Town Clerk which advised Members of the key discussions which had taken place during recent meetings of the Committee’s Sub-Committees.

In response to a query, new Members were provided with the background and rationale for the establishment of the Operational Property and Project Sub-Committee (OPPSC).

The Chairman informed Members that there was a discussion at the recent OPPSC meeting about whether the Sub-Committee’s officer delegation threshold levels could be increased; this would be considered further in conjunction with the Policy and Resources Committee.

The Chairman also informed the Committee that, during its meeting, Members of the Financial Investment Board (FIB) had considered changing term limits for Members to sit on the Board from one year to a three- or four-year term; a request would be made to the Policy and Resources Committee in due course.

RESOLVED – that the Committee noted the Report.

Report of the Chamberlain

The Committee received a Joint Report of the Chamberlain and the Chief Operating Officer which provided updates regarding the top risks within their Departmental Risk Registers.

As per the discussion in item 5, the Chamberlain proposed that the risks associated with IT should, going forward, be reported into the Digital Services Committee as opposed to the Finance Committee; she assured Members, however, that if an IT related Risk did emerge which had a material impact on the City’s finances, it would be brought to the Finance Committee’s attention in good time.

In addition, the Chamberlain highlighted the updated Unsustainable Medium-Term Finances Risk (CR35); the two key current drivers for this Risk are the ongoing inflationary pressures across the economy and the state of the post-pandemic recovery.

In response to Members raising concerns about whether an amber score (12) for CR35 was sufficient given the deteriorating inflationary situation, the Chamberlain stressed that officers were remaining highly vigilant on this issue, she also highlighted that, whilst the amber score was predicated on there being mitigations in place to meet the challenge in the immediate term, consideration would need to be given to how to continue to try to mitigate the challenge in 2023/24, especially if inflation continued to be a factor into 2023 as was the expectation of the Bank of England.     

The Chamberlain added that Members of the Resource Allocation Sub-Committee would be looking at this in depth at their Away Day on Friday 17^th June.

In response to a separate query concerning the Employer contributions to the City’s Pension Scheme, the Chamberlain highlighted the upcoming Actuarial Review; she informed Members that, in each of the last seven years, the Corporation had been able to hold its contribution at the same rate; if the Actuarial Review should come back with

Report of the Chief Operating Officer.

The Committee considered a Report of the Chief Operating Officer concerning the Responsible Procurement Policy. Noting that the appendices were missing from the Report, the Chairman asked the Committee clerk to circulate these to Members as soon as possible.

Officers informed Members that, at its last meeting on 9^th June, whilst being generally supportive of the direction of travel, the Policy and Resources Committee decided to defer its approval of this Report due to concerns about whether the responsible procurement weighting of 15% was appropriate; officers would be considering these concerns and would be coming back to P&R at its next meeting on 7^th July with a revised Report.

Consequently, the Chairman proposed that Members provide the Town Clerk, in consultation with the Chairman and the Deputy Chairman, delegated authority to approve the revised Report, on behalf of the Finance Committee once it had been scrutinised by P&R in July.

In response to concerns about the length of the implementation period, officers assured Members that this was required to build in the time to prepare small and micro businesses to meet the expectations and criteria of the Corporation’s procurement opportunities.     

Separately, reflecting that several local authorities frequently included a 20% weighting, officers clarified that the proposed 15% weighting at the City Corporation should be seen as the base level, and, on a case-by-case basis tenders could include a higher weighting for responsible procurement if appropriate. The base 15% weighting was considered by officers to be, on balance, the optimal level.  

Whilst supporting the broad aims in the Report, several Members raised concerns that the small and micro businesses that the City was aiming to work with would still struggle to achieve the criteria; it was vital that barriers were kept at a minimum, the administration involved

Report of the Managing Director, Bridge House Estates, City Bridge Trust

The Committee received a Report of the Managing Director of Bridge House Estates and Chief Charities Officer concerning the Central Grants Unit (CGU).

In response to a query, officers assured Members that the Grant Management Process was robust, with a comprehensive monitoring and evaluation at key points throughout the year, plus an annual review meeting, in which any agreement for repeat funding in the following year requires the submission of evidence displaying satisfactory compliance with the CGU’s processes. It was fair to say that those organisations which received smalling funding would attract a lighter touch monitoring regime than those in receipt of larger grants.

RESOLVED – that the Committee noted the Report.

Report of the Managing Director, Bridge House Estates, City Bridge Trust

The Committee received a Report of the Managing Director of Bridge House Estates and Chief Charities Officer concerning Benefits-In-Kind (BIK).

In response to a query about why the rate of Benefits-In-Kind had increased over the last 12 months, officers responded that, with the easing out of lock-down and other covid restrictions, the Corporation’s facilities have been far more in use over recent months, compared to 2020/21, when, for instance, the Remembrancer’s Department had a nil return for BIK. Officers added that from 2023/24, all departments would be required to factor in BIK as a distinct item in their budgeting, so the data collected should be more accurate.

In response to a query about whether a BIK strategy would be forthcoming, officers emphasised that a strategy document was currently being worked up and that contributions from Members by way of comments and suggestions would be welcome. A Member requested that consideration be given to ensuring that any strategy which emerged took the risk of potential conflicts of interest into account. The Chairman thanked the Member for this important point and encouraged other Members to reach out to officers after the meeting.  

Separately, a Member asked for more granular detail when it came to the BIK associated with the Barbican (page 66 in the agenda pack); the Report did not specify whether this referred to the Barbican residential estate or the arts centre. Officers would come back to the Member after the meeting with the relevant detail.

RESOLVED – that the Committee noted the Report  

Report of the Chamberlain

To be considered in conjunction with the non-public appendix at Item 17.

The Committee received a Report of the Chamberlain which provided Members with information regarding the current balance of the Finance Committee Contingency Funds for the current year.

RESOLVED – that the Committee noted the Report.

A Question was raised as follows -

A Member queried whether the recommendations in the annual Budget Report in relation to the Medium-Term Financial Plan had been implemented.

The Chamberlain responded that the majority of the recommendations have been implemented; several, however, have been impacted by other factors, including the deteriorating economic outlook, and implementation will, therefore, be over longer timeframe. Further discussions will take place at the Resource Allocation Sub-Committee’s Away Day on 17^th June. The Chairman requested that the minutes from the Away Day are provided to the Finance Committee in July as part of a wider discussion on the outlook for the Medium-Term Financial Plan.  

There were no urgent items.

MOTION - That under Section 100(A) of the Local Government Act 1972, the public be excluded from the meeting for the following items on the grounds that they involve the likely disclosure of exempt information as defined in Part I of Schedule 12A of the Local Government Act.

RESOLVED - That under Section 100(A) of the Local Government Act 1972, the public be excluded from the meeting for the following items on the grounds that they involve the likely disclosure of exempt information as defined in Part I of Schedule 12A of the Local Government Act.

To agree the non-public minutes of the meeting held on 3 May 2022.

RESOLVED – that the non-public minutes of the meeting held on 3^rd May 2022 were approved as an accurate record.

Report of the Town Clerk

The Committee received a Report of the Town Clerk which advised Members of the key non-public discussions which had taken place during recent meetings of the Committee’s Sub-Committees.

To be considered in conjunction with the report at Item 11.

The Committee noted the non-public appendix to ITEM 11 (Contingencies).

Report of the City Surveyor

This Report was withdrawn.

There were no non-public questions relating to the work of the Committee.

The Committee considered an item of urgent business relating to West Ham Park.

To agree the confidential minutes of the meeting held on 3 May 2022.

RESOLVED – that the confidential minutes of the meeting held on 3^rd May 2022 were approved as an accurate record.

Report of the Chief Operating Officer

This Report was withdrawn.