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CAIRNGORMS NATION­AL PARK AUTHOR­ITY Fin­ance & Deliv­ery Com­mit­tee Paper 2 11/10/19

CAIRNGORMS NATION­AL PARK AUTHOR­ITY FIN­ANCE & DELIV­ERY COMMITTEE

FOR DIS­CUS­SION

Title: FIN­ANCE MON­IT­OR­ING: 5 MONTHS TO 31 AUGUST 2019 Pre­pared by: DANIEL RAL­PH, FIN­ANCE MANAGER

Pur­pose To present a sum­mary review of income and expendit­ure for the 5 months to 31 August, 2019.

Recom­mend­a­tions The Fin­ance & Deliv­ery Com­mit­tee is reques­ted to: a) Note the out­turn for the 5 months to 31 August 2019

Exec­ut­ive Summary

1. The main report to the Com­mit­tee is con­tained in Annex I. This report cov­ers the 5 main com­pon­ents of the Authority’s oper­a­tions — Core and Oper­a­tion­al Plan and pro­jects: LEAD­ER, the Tomin­toul & Glen­liv­et Land­scape Part­ner­ship (T&GLP), Great Place Badenoch (GPB) and the Caper Frame­work (CF).

2. Annex 2 is the ana­lys­is of the Oper­a­tion­al Plan by Theme, show­ing both expendit­ure (actu­al and com­mit­ted) and any attrib­ut­able income.

3. Any adverse vari­ances year to date are high­lighted under CORE activ­it­ies. Vari­ances on CORE expendit­ure and Oper­a­tion­al Plan are mon­itored on an ongo­ing basis and vari­ances of great­er than 15% or £5,000 from budget, whichever is the high­er, will be brought to the Committee’s atten­tion. Most of the repor­ted vari­ances will self- cor­rect dur­ing the fin­an­cial year due to the tim­ing of spend and recog­ni­tion of pre­pay­ments or accruals.

4. Pos­it­ive vari­ances in future reports will be repor­ted as + £x,xxx and neg­at­ive as

   • £x,xxx.

CAIRNGORMS NATION­AL PARK AUTHOR­ITY Fin­ance & Deliv­ery Com­mit­tee Paper 2 11/10/19

Over­view

Oth­er Income

1. Oth­er income of £44,400.40 recog­nised to August includes: a) Recov­ery of leg­al fees £11,219.10 b) Plan­ning fees £31,614.80 c) NPP sourced income £168.40 d) Shared costs recovered £207.00 e) Oth­er recov­er­ies £191.12

2. Oper­a­tion­al Plan income of £197,839.01 includes: a) Con­ser­va­tion — For­rest hol­i­days £5,000.00 b) Vis­it­or Access — Writer in res­id­ence £16,573.25 LCTT recov­er­ies £3,484.08 Hightrans £10,099.20 c) Rur­al Devel­op­ment – RTIP £143,393.00 (Din­net & Glen­more) Sus­trans Glen­more £15,000

3. It should be recog­nised that all the Oper­a­tion­al Plan income received to date is either recov­er­ies against expendit­ure incurred in the peri­od or income to be spent on pro­jects in the year. The net impact to the budget for the year is nil.

Staff costs recovered of £207,779.40 includes con­tri­bu­tions and fund­ing from third parties, Her­it­age Lot­tery Fund (against staff dir­ectly employed by the Author­ity on HF pro­jects), recov­er­ies against spe­cif­ic staff roles (East Cairngorms Moor­land officer, Peat­land officers, Access officer [now ceased]) and staff ​“pur­chas­ing” addi­tion­al annu­al leave.

CORE Activ­it­ies

Board and Staff Costs

1. Board fees are ahead of budget after the 5 months and this is expec­ted to fall through­out the remainder of the year and for costs to be with­in budget.

2. Core and pro­ject staff costs, and recov­er­ies are broadly in line with pro­jec­tions for the period.

3. ²⁰¹⁹⁄₂₀ is the first year that staff costs recovered have been repor­ted sep­ar­ately and there­fore future year’s budgets oth­er income and expec­ted staff costs recov­er­ies will be repor­ted sep­ar­ately for great­er clarity.

Oth­er Board and Staff Costs

1. Oth­er board and staff costs are broadly in line with expect­a­tions giv­en the nor­mal phas­ing of expenditure.

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CAIRNGORMS NATION­AL PARK AUTHOR­ITY Fin­ance & Deliv­ery Com­mit­tee Paper 2 11/10/19

Facil­it­ies Costs / IT and Pro­fes­sion­al Costs

1. In addi­tion to points a – d which were repor­ted in the last mon­it­or­ing paper, points e onwards should be noted for the 5 months:

a) Rates have been paid in full for the whole year in April. Full pro­vi­sion for the addi­tion­al rates for the new build was taken into the ¹⁸⁄₁₉ as an accru­al; b) Rent for the new build is now com­ing through as expec­ted and at anti­cip­ated levels; c) Motor vehicle insur­ance has been recog­nised for the full year; d) Pre­pay­ments recog­nised in ¹⁸⁄₁₉ for ¹⁹⁄₂₀ were released in full over all accounts in April this includes rent, the motor vehicle fleet and IT main­ten­ance and ser­vices plans. Oth­er than this there are no adverse vari­ances to report; e) Sav­ings are expec­ted over the year, and until the end of the cur­rent con­tract, on the nova­tion of 2 mobile phone con­tracts into 1. Anti­cip­ated sav­ings are £8,000. Fur­ther sav­ings are also pos­sible on VOIP and BT and can­not be quan­ti­fied at this stage; f) Office clean­ing costs likely to be up to £5,000 high­er than budget for year due to con­tract­or passing on increases re Scot­tish Min­im­um wage; g) Staff recruit­ment is show­ing an over­spend of £10,313 due to the high­er than expec­ted levels of staff turnover and delayed recruit­ment; h) Ser­vice improve­ment costs are £14,756.38 due to unbudgeted costs relat­ing to a new approach to cul­tur­al change and devel­op­ment with­in the Author­ity which is a key tool in deliv­er­ing ODS3.

Oper­a­tion­al Plan

1. Annex 2 shows the amounts paid and com­mit­ted com­pared to the agreed budget for the year.

2. Com­mit­ted spend and actu­al spend at 31 August is approx­im­ately 65% of the adjus­ted Oper­a­tion­al Plan for the year.

3. With the excep­tion of Plan­ning and Com­mu­nic­a­tions & Engage­ment, com­mit­ted spend and actu­al spend is ahead of expect­a­tions for this time of year reflect­ing largely budgets being com­mit­ted early in the fin­an­cial year.

4. Com­mu­nic­a­tions & Engage­ment typ­ic­ally com­mits later in year.

5. With­in the Plan­ning budget the biggest single com­mit­ment yet to be made is against the Devel­op­ment, Plan­ning Envir­on­ment Appeals (DPEA) ini­tial costs. The Loc­al Devel­op­ment plan was sub­mit­ted on 20^th Septem­ber, and we have reques­ted an estim­ate of fees, which will con­firm wheth­er the budget will be adequate or wheth­er there is poten­tial to vire an under­spend. Also, the leg­al fees budget is treated as com­mit­ted and this may be sub­ject to vire later in the year.

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CAIRNGORMS NATION­AL PARK AUTHOR­ITY Fin­ance & Deliv­ery Com­mit­tee Paper 2 11/10/19

Non-Cash

1. Non-cash budget pro­vi­sion from Scot­tish Gov­ern­ment provides for depre­ci­ation of assets and oth­er account­ing pro­vi­sions made neces­sary by the Authority’s oper­a­tions. The budget alloc­ated for ²⁰¹⁹⁄₂₀ is £150,000, com­pared to £116,000 included in the Budget.

2. Cur­rent pro­jec­tions for ²⁰¹⁹⁄₂₀, based in assets in use at the begin­ning of the fin­an­cial year, pro­posed cap­it­al spend, with no abnor­mal charges or write downs for diminu­tion in value, indic­ates that cur­rent year’s non-cash budget will be under­spent by approx­im­ately £5,000.

Grant-in-Aid

1. Resource (R DEL): resource grant-in-aid has been drawn down in line with the planned draw­down (£1,945,000 to date of £4,565,000). The inten­tion is to draw down as profiled.

2. Cap­it­al (C DEL): £60,000 cap­it­al grant-in-aid has been drawn down in line with the planned draw­down (budget of £240,000). The C Del alloc­a­tion is to cov­er assets bought to be used in the Park Authority’s oper­a­tions or to be spent as cap­it­al contributions/​grants.

Cap­it­al Spend

1. Cap­it­al spend to the end of August includes:

a) Digit­al infra­struc­ture and devices £10,483 b) Soft­ware £1,745 c) Oper­a­tion­al assets £9,372

Pro­jects

Tomin­toul & Glen­liv­et Land­scape Partnership

1. Amounts due from the Her­it­age Lot­tery Fund (HLF) since last paper to Committee:

Quarter ended £ Received 31 March (claim 8) 64,034 ²⁴⁄₀₆ 30 June (claim 9) 238,965 ²¹⁄₀₈ 30 Septem­ber (claim 10) estim­ate 115,000

1. The final con­tri­bu­tion to the Pro­ject from High­land and Islands Enter­prise (HIE) (£50,000) has been claimed.

2. Activ­ity is accel­er­at­ing on the major pro­jects Blairfindy, Scalan and Access (largely com­plete), and mater­i­al with mater­i­al pay­ments from May. As the pro­ject is now 13 months from com­ple­tion there remains sub­stan­tial work to com­plete, espe­cially on

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CAIRNGORMS NATION­AL PARK AUTHOR­ITY Fin­ance & Deliv­ery Com­mit­tee Paper 2 11/10/19

Scalan, Blairfindy and the water envir­on­ment pro­jects. This will put pres­sure on cash flow in the 3^rd and 4^th quar­ters of ²⁰¹⁹⁄₂₀.

LEAD­ER

1. All claims for pro­ject advances and admin­is­tra­tion costs con­tin­ue to be made on the ​“LARCS” system.

2. £128,129.60 was received in Septem­ber April, of which £15,907.95 related a claim out­stand­ing at 31 March 2019. £468 remains to be paid against one claim out­stand­ing at 31 March. The ​“RAG” status on LARCS remains at ​“amber” and we are hop­ing this will be changed to ​“green” shortly.

28. Admin Pro­ject Sus­pense Claims still Total costs advances to be made claimed claimed £ £ £ £ £ As at 01.04.19 — 114,085.33 (277.67) 30,431.85 144,239.51 Trans­fer — 15,907.95 (0.44) (15,907.95) (0.44) Advances made — 186,434.74 — 29,369.40 215,804.14 Admin claims 48,154.44 — — 12,076.65 60,231.09 Received — (151,103.03) — — (151,103.03) As at 30.04.19 48,154.44 165,324.99 (278.11) 55,969.95 269,171.27 Received Septem­ber — (128,139.60) — — (128,139.60)

	48,154.44		37,185.39		(278.11)		55,969.95		141,031.67

1. The August admin­is­tra­tion claim (£12,076.65) was made in Septem­ber. The remain­ing £43,893.30 of claims still to be made (4) are depend­ent on soft­ware changes being applied to the LARCS sys­tem in Edinburgh.

2. All the pro­ject advances and admin­is­tra­tion claims made by the end of August are flagged as ​“due to the LAG”.

3. Admin­is­tra­tion claims are now being made monthly.

Great Place Badenoch

1. This is a 3 year (to end by 3 March 2021) HLF pro­ject to con­serve and devel­op­ment the cul­tur­al her­it­age of Badenoch. The per­mis­sion to start was gran­ted in March 2018 and a pro­ject man­ager was in post in April. (The pro­ject man­ager is employed by Vol­un­tary Action Badenoch & Strathspey,)

2. Amounts due from the Her­it­age Lot­tery Fund (HLF) since last paper to Com­mit­tee: Quarter ended £ Received 30 June (claim 5) 26,186 24 July 30 Septem­ber (claim 6 estim­ate) 20,000

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CAIRNGORMS NATION­AL PARK AUTHOR­ITY Fin­ance & Deliv­ery Com­mit­tee Paper 2 11/10/19

Caper­cail­lie Framework

1. The Devel­op­ment Phase of the HLF pro­ject to con­serve the remain­ing Caper­cail­lie pop­u­la­tion in the Cairngorms was giv­en the per­mis­sion to stat by HLF on 28^th June and all dir­ectly employed staff are now in post. HLF will con­trib­ute fund­ing at a rate of 62.5%.

2. Amounts due from the Her­it­age Lot­tery Fund (HLF) since last paper to Committee:

Quarter ended £ Received 31 March (claim 4) 25,733 ¹⁸⁄₀₆ 30 June (claim 5) 22,133 ¹⁹⁄₀₈ 30 Septem­ber (claim 6 estim­ate) 37,000

CASH FLOW AND CASH MANAGEMENT

1. Although CNPA has been suc­cess­ful in attract­ive fund­ing for high value pro­jects the cash man­age­ment falls on CNPA to ensure that adequate fund­ing is avail­able to meet pro­ject liab­il­it­ies as they arise, in addi­tion to CNPA’s own fund­ing require­ments and to stay with­in guidelines set by the spon­sor­ing Depart­ment and Scot­tish Government.

2. The RAG status of cur­rent pro­jec­ted cash flow, until 31 Decem­ber 2019, with the cash pos­i­tion of each component’s RAG status shown. (Red, warn­ing; amber, neut­ral; green pos­it­ive) is as follows:

Quarter ended… Sept Dec Mar CORE activ­it­ies 🟢 🟢 🟢 LEAD­ER 🟢 🟢 🟢 T&GLP 🟢 🟠 🟠 GPB 🟢 🟠 🟠 CF 🟢 🟢 🟢

Out­turn Pos­i­tion ²⁰¹⁹⁄₂₀

1. All budget lines con­tin­ue to be mon­itored on a weekly basis, while work­ing closely with Heads of Ser­vice to identi­fy pres­sure points or slack as early as possible

2. The ¹⁹⁄₂₀ budget presen­ted to the Board in March showed a planned defi­cit of £33,000. While were are now almost half way through the year the pro­jec­ted out­turn will be fore break­even or very close as pos­sible to break even on resource and cap­it­al spend without impact the deliv­ery of the Oper­a­tion­al Plan objectives..

Daniel Ral­ph danielralph@​cairngorms.​co.​uk 30 Septem­ber, 2019

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