WARNING - By their nature, text files cannot include scanned images and tables. The process of converting documents to text only, can cause formatting changes and misinterpretation of the contents can sometimes result. Wherever possible you should refer to the pdf version of this document. CAIRNGORMS NATIONAL PARK AUTHORITY Finance Committee Paper 3 15/06/07 CAIRNGORMS NATIONAL PARK AUTHORITY FINANCE COMMITTEE FOR DECISION Title: 2007-08 PROPOSED BUDGET Prepared by: Denby Pettitt, Finance Manager Purpose To provide Members with an update on the budget position for the 2007-08 Financial Year. Recommendations • That the Committee approve the proposed 2007-08 budget. Executive Summary a) Grant in Aid funding from the Scottish Executive is £4.546m for the current year compared with £4.446m for 2006-07. b) Salary costs have risen since 2007-08 will include a full years’ impact of employees who were recruited during 2006-07. Other Core costs are budgeted to be close to last year’s level. c) The amount of Operational Plan spend available to meet the Authority’s Corporate Plan and National Park Plan aims rises to £1,682m and we have already identified specific spending plans for this amount. d) At present we’re budgeting a deficit of £52,000 for the year which is manageable given the agreed over-programming of Operational Plan spend. 2007-08 PROPOSED BUDGET FOR DECISION Introduction 1. The Committee received a summary of the expected Core and Operational Plan budgets for 2007-08 at its meeting in December 2006 as part of the Comprehensive Spending review paper. The Board meeting in February 2007 also agreed the Operational Plan for the current year. 2. The Authority’s Resource Allocation for 2007-08 has been agreed with the Scottish Executive at £4.633 million which includes funding to meet non-cash costs such as depreciation and notional costs. 3. The amount of Grant in Aid we will receive to spend is £4.546 million. 4. The Authority incurs two main types of expenditure: a) Core running costs covering administrative expenditure such as Board costs, staff salaries, office running costs and capital expenditure; and b) Programme expenditure that covers expenditure on the Operational Plan that is spent in meeting Corporate Plan goals. 5. Core expenditure tends to be relatively fixed monthly expenditure whilst the amount spent on Programme expenditure can vary from month to month depending on activity being undertaken. Summary 6. The following table summarises the budget position and further detail is shown in Annex 1 and 2: see para. / Proposed budget (2007-08) £’000 / Draft results (2006-07) £’000 Scottish Executive Grant in Aid 2. 4,546 4,446 Planning fees, bank interest and other income 55 55 Non-cash income 87 100 Total income 4,688 4,601 Core (inc. notional costs & depreciation) 8-11. 3,058 2,846 Programme 12-14. 1,682 1,559 Total expenditure 4,740 4,405 (Deficit)/Surplus ( 52) 196 7. The draft results for 2006-07 show a surplus of £196,000 at present although we are still finalising the year-end accruals which may reduce this surplus. 8. The draft outturn position is considered in more detail in Paper 4. Core expenditure 9. Core costs, as a percentage of total spend, are shown below: Board Actual 2003-04 % 12 Actual 2004-05 % 7 Actual 2005-06 % 6 Draft 2006-07 % 6 Budget 2007-08 % 5 Staff salaries Actual 2003-04 % 25 Actual 2004-05 % 39 Actual 2005-06 % 39 Draft 2006-07 % 43 Budget 2007-08 % 43 Other staff costs Actual 2003-04 % 15 Actual 2004-05 % 9 Actual 2005-06 % 6 Draft 2006-07 % 5 Budget 2007-08 % 4 Office Actual 2003-04 % 10 Actual 2004-05 % 11 Actual 2005-06 % 9 Draft 2006-07 % 9 Budget 2007-08 % 9 Capex Actual 2003-04 % 22 Actual 2004-05 % 3 Actual 2005-06 % 0 Draft 2006-07 % 0 Budget 2007-08 % 1 Notional costs Actual 2003-04 % 2 Actual 2004-05 % 3 Actual 2005-06 % 3 Draft 2006-07 % 2 Budget 2007-08 % 2 Core Actual 2003-04 % 86 Actual 2004-05 % 72 Actual 2005-06 % 63 Draft 2006-07 % 65 Budget 2007-08 % 65 Programme Actual 2003-04 % 14 Actual 2004-05 % 28 Actual 2005-06 % 37 Draft 2006-07 % 35 Budget 2007-08 % 35 100 100 100 100 100 10. The table shows that the split of resources between Core and Programme activities is now relatively stable. Staff salaries 11. The Authority has agreed a two year pay remit which ends in March 2008. The salary costs included in the budget are based on this which includes Performance Related Pay and 1.65% increases in respect of cost of living adjustments. 12. Budgeted staff costs increase in 2007-08 as a result of the combined effect of the pay award and completion of the planned staff recruitment, in line with the agreed Corporate Plan, during 2006-07 which gives a full years effect in 2007-08. Budgeted salary costs of £2.043m in 2007-08 compare with £1.950m in 2006-07. Other Core expenditure 13. Annex 2 shows a more detailed breakdown of Core expenditure which, with the exception of salary costs, shows little change from last year’s levels. As far as possible, officers seeking to control core expenditure budgets in order to maintain the funding levels within the Operational Plan. Programme expenditure 14. Anticipated spend on the Operational Plan is as follows: Actual 2003-04 £'000 267 Actual 2004-05 £'000 944 Actual 2005-06 £'000 1,575 Draft 2006-07 £'000 1,559 Budget 2007-08 £'000 1,682 15. For each line of the Operational Plan with a financial spend, detailed Action Plans are being drawn up which, as well as the timing of payments, has individual milestones against which progress can be monitored. These will give an early warning if the project is dropping behind schedule and a decision can be made as to whether the project will catch up or whether it should be cancelled and the available funds transferred to another area. Once these are completed the summary budget profile will be circulated to Committee members. 16. As last year, we will review the Operational Plan quarterly with the first review being scheduled for mid-July and the outcome of this will be reported back to the Finance Committee/Board in due course. Denby Pettitt 31 May 2007 denbypettitt@cairngorms.co.uk CNPA Income & Expenditure account (Table not available in full text format) CNPA Core Expenditure (Table not available in full text format)