Auditors criticise York Council

Usually the arrival of the annual auditors report at a York Council meeting produces little excitement (or even mild interest).

Things may be a little different at a governance meeting which is scheduled to take place on 31st March.

While the Councils auditors Mazers give a generally positive view of the Council’s financial arrangements, they do take a pop at the process used to compensate the Councils last Chief Executive when she left the authority, quite suddenly, in 2019.

click image to access the full report

The Council has issued the following comments;

City of York Council has published its 2019/20 final accounts, which will be considered by the Council’s Audit and Governance Committee later this month.

The council’s accounts are subject to external audit by Mazars LLP, who previously highlighted four outstanding areas at the Audit and Governance Committee meeting in November 2020 that required final approval:

  • The heritage assets valuation where information has now been provided by York Museums Trust but was delayed due to the impact of Covid-19. Mazars have made a control recommendation in respect of the arrangements to review, challenge and document the output of valuation experts.
  • The council’s pension fund administrators, North Yorkshire Pension Fund, are unable to confirm pension figures in the accounts. This issue is not specific to City of York Council and affects all local authority members of the pension fund. Mazars have discussed future arrangements with the council to put arrangements in place for a full valuation in 2020/21.
  • Additional information regarding remuneration packages from the council is currently being worked through by Mazars. Mazars concluded that the sums involved do not present a risk of material misstatement.  Additional information regarding remuneration packages is ongoing and will be published when completed.
  • The audit of the ‘Whole of Government Accounts (WGA)’ return has yet to be completed due to a delays in receiving guidance from the National Audit Office.

Mazars LLP have now completed the majority of this work and provided the council with an updated Audit Completion report, together with a final version of the Accounts published in advance of the next meeting of Audit and Governance for information. 

Mazars identified there are no matters arising on the management override of controls or from work on revenue recognition.  Mazars have not identified any material errors or uncertainties in the financial statements or highlighted any indication of material estimation error in respect of defined benefit liability valuation. 

Responding the publication of final accounts, Debbie Mitchell, Chief Finance Officer, said:

Despite the impact of the pandemic, the Council was still able to complete and deliver draft accounts to the external auditor by the end of June 2020, a full month ahead of the statutory deadline. 

“Following detailed assessment of four areas identified by the auditors as requiring further work, Mazars have not identified any material errors in the financial statements and have indicated that the accounts give a true and fair view of the financial position of the council and that they have been properly prepared.

“Further work is taking place to provide additional information regarding remuneration packages and when this work is completed, it will be published and shared with the Audit and Governance Committee.  This does mean that the final audit certificate cannot yet be issued.  However, the auditor has made clear that this objection does not have a material impact on the financial statements. 

“We welcome the feedback from the external auditor and fully recognise that there are areas for improvement. We look forward working with Mazars to develop an appropriate action plan once this outstanding matter is published.” 

York Council to cut 20% from highway maintenance

A response to a Freedom of Information request has revealed that the Council intends to spend 20% less on repairing roads and footpaths in the City during 2021/22 compared to the current year.

The decision will come as a disappointment to many drivers and pedestrians and will be a particular blow for cyclists, many of whom have criticised the rapidly declining quality of local highway surfaces.

Highway maintenance is one of the expenditure areas in the Council where essentially you get what you pay for. So less money inevitably means that fewer paths and carriageways will be resurfaced.

The Council will announce shortly what proportion of the budget it will spend on reactive pothole filling rather than, longer lasting, patching and resurfacing schemes.

Sources at the Council have criticised inconsistent central government funding allocations – such as the annual so called “pot hole” fund – which make long term investment planning difficult. A late announcement of funding for the resurfacing of Tadcaster Road came only weeks after the work had been completed using local taxpayers money (and is now being done again).

However, there will also be concern that some money has been taken from the maintenance budget to fund other projects. Several new schemes, such as rural cycle routes, are sucking funds from the budgets needed to repair existing cycle paths..

The Council has never recovered from the major reductions made to highways funding some 8 years ago.

Successive administrations have failed to find ways of returning investment levels to those seen earlier in the century.

It is estimated that the backlog in maintenance work nationally would require investment of around £11 billion to rectify.

Rates relief applied to business rates

Image result for business gifs

An initial £17.5m relief has been applied to rates bills which arrive with York businesses this week.

Having joined local and regional partners in making the case to central government for further business rates relief, City of York council delayed issuing rates bills until after the budget announcement on Wednesday 3 March.

The Chancellor announced that eligible retail, hospitality, leisure and nursery business will receive a rates discount of:

  • 100% for the first three months, totalling £17.5m for eligible York businesses
  • Up to 66% for the remainder of the 2020/21 financial year

The total value of the rates relief will depend on how many businesses reach the discount cap set by the government:

For eligible retail, hospitality, leisure properties the £2m for businesses that were required to close as at 5 January 2021, and up to £105,000 for business permitted to open at that date.

For eligible nursery properties the relief will be capped at £105,000 per business, regardless of the open or closed status.

Following government guidance, eligible businesses will receive two bills. The first will show a 100% discount from April 2021. The council will then issue an adjusted bill from 1st July 2021 showing 66% discount for the period from 1st July 2021 to 31st March 2022.

Businesses which do not have access to their registered premises to collect their bill can contact the rates team by e-mail at business.rates@york.gov.uk.

Businesses that wish to opt out of the Retail, Hospitality & Leisure Rate discount scheme, or Nursery discount scheme may do so by contacting business.rates@york.gov.uk before 30th April 2022. Please note that any business opting out of this scheme cannot withdraw their refusal for either all or part of the financial year.

Electric vehicles? Where next in York

With the sale of new internal combustion powered cars scheduled to end in 9 years time, there is increasing pressure to extend the recharging network in York. Battery power (or maybe in the longer-term hydrogen fuel cells) will soon be the only option available.

Electric reuse collection vehicle

The Councils budget does includes plans to invest over £5 million in making its own fleet all electric. It includes a £1.8 million infrastructure programme and says it is doing so  to ensure that the Council is “carbon neutral” by 2030.  

A report being considered today, says “a  key element of the investment is to develop an electric charging infrastructure at the (Council) depot, satellite depots and home charging to ensure full charging capacity of all vehicles at all times can be met”.

 In recent years, the Council has had a poor procurement record on vehicle renewal. The result has been a refuse collection fleet which, by last summer, had become chronically unreliable. They need to be more decisive, and realistic about delivery timescales, in the future.

A Hyper recharging Hub

The Council has already announced plans for a “HyperHubs” project to provide “next generation electric vehicle charging infrastructure at Monks Cross and Poppleton Bar Park & Ride sites”. The Monks Cross HyperHub is due to be completed by April 2021 and will include the first Ultra Rapid chargers in the City.

The Council says that design work is continuing for a third City Centre HyperHub following the decision to move the site from York Hospital “which had insurmountable access issues”. The hub is due to open in the autumn of 2021, although details of the location have not been released.

One possible site is the Piccadilly multi storey car park which has been under-used since the Council switched off the advance car park space availability systems 8 years ago. If it were designated for electric vehicles it might be possible to reopen the tunnel link from the nearby Castle Car park.

See the source image
Some lampposts in London are being fitted with recharging sockets

One of the ongoing issues to be addressed with charging bays is their reliability and occupancy limits.  Recharging to 80% capacity takes about 30 minutes on most new electric cars. When charged up, the vehicle owner must return to the vehicle and free up the space for other users.

Home charging on the other hand is more convenient and can take place overnight if a £400 home box is fitted. That option is not available for those who park on the street.

The Council will spend another £550,000 next year in renewing lampposts. As part of the programme LED fittings will be used. These reduce power use. This offers the opportunity for recharging sockets to be included in the specification.

The Council want to ban cars from York City centre

No such proposals have been made in York although the lamppost charging option is available in parts of London, while Oxford is trialling the provision of ducted access to adjacent properties where off street parking is impossible.  

Access to lamppost sockets is available for only a limited time so, where streets have a parking deficit already, reserving parking bays for charging will only exacerbate the problems.  

There is little sign of Councillors addressing these issues.

Instead many have simply said they oppose the use of personal transport in the urban area however the vehicles  may be fueled.

Council to borrow over £20 million more.

The York Council will consider tomorrow adding over £20 million to its debt burden.

 The cost to taxpayers of paying interest and redemption charges on the extra borrowing is put at £1.4 million a year.

The Council says that the costs of the new Knapton forest will now be met from “external sources”. It is therefore switching that expenditure into buying electric vehicles and associated charging facilities at a cost of over £5 million.

£100,000 will fund an “access barrier review”. This is thought to be a response to a section of the cycle lobby which is opposed to the use of safety barriers where they slow cycle movements. While an audit of infrastructure standards and repair works on the York cycle network is long overdue, concentration of limited resources on the relatively trivial barrier issue reflects poor prioritisation.

£1.1 million will be spent repairing Lendal Bridge while £1 million is reserved for the – more than slightly opaque – “COVID recovery fund”.

Probably the most controversial proposal is the plan to cut another £3.2 million from highways maintenance. This is the fund which is used to reconstruct road and path surfaces. It is a long-term investment which gives carriageways a 30 year plus lifespan. In turn this minimises the risk of frost damage. The large number of potholes which we have seen on the highway network recently suggests reconstruction should be a high priority.

All parties promised improved highway maintenance standards at the last local elections

. The cut in the highways maintenance budget is partly justified by officials who point to the £5 million being paid by central government for the resurfacing of Tadcaster Road (for the second time in less than a year). The resurfacing will not provide any additional benefit for road users.

Money is being transferred from highways resurfacing to fund the Council’s £2 million contribution to the Fordlands Road flood alleviation scheme. This is the scheme which should have been completed, and funded, as part of the recent improvements to the A19 in Fulford.

The report points out that there could still be further costs to be added to the budget as work on York Central, the Guildhall, Castle Gateway and dualling the outer ring road proceeds.

A copy of the proposed programme can be viewed by clicking here

Anger as York Council plans to reduce expenditure on fixing potholes

Hopes were raised last year when the York Council established a second pothole filling team in the City. It was hoped that the initiative would at least slow the rapidly deteriorating condition of highways in the City.

Expectations were further raised when the Department of Transport allocated part of its “Pothole challenge fund to the City.

Sadly, the hoped-for improvements have not materialised.

Many highways are breaking up under the impact of ice and frost. A well-maintained surface is less vulnerable to frost damage but lack of urgency in patching roads in the summer and autumn, means that large stretches are now unsafe for users.

The Council has been criticised this week for failing to embrace new maintenance technologies.

Now hidden within a large report, being considered by the Council later this week, is a proposal which would see less spent on resurfacing.

£600,000 will be taken from pothole filling/resurfacing and instead used to partly fund new schemes like the cycle path link from Wheldrake to Fulford.

Even the most extreme pro cycling campaigners are now realising that maintaining existing paths should be the Councils priority when funds are limited.

The existing cycle and highway networks are in poor condition. Why not fix them first before building more paths?

Sadly, one of the reasons seems to be that highway resurfacing activity is not very glamourous.

There will be no official naming of the pothole that Andy filled in.

On the other hand, a new path may – for a while – attract favourable publicity for its sponsors, at least until it too needs to be resurfaced.

Separately, the same report says that

  • the second resurfacing of Tadcaster Road is being delayed until the summer. Gas main works are currently taking place there.
  • promised repairs on National Cycle Network 65 will now not be completed until 2021/22.
  • £877,000, which was to have been spent this year on Highways Ward Committees schemes, will also be delayed until next year.

Bad news for taxpayers as another Community Stadium overspend of £1.2 million is revealed.

The Council has finally admitted that the £46.2 million budget for the York Community Stadium will be overspent by £1.2 million.

Taxpayers had already taken a hit late last year when a payment for the lease of the commercial element of the scheme was reduced by £1.4 million.

How stadium budget has changed over the last 5 years

It now looks like the final taxpayers bill will be £17 million.

When the scheme was originally conceived in 2010, it was expected that a contribution of £16.7 million from the developer of the neighbouring Vanguard shopping area, would cover the stadium construction costs.  This has proved not to be the cases as costs escalated in the intervening years.

The Council says that part of the cost will be offset by lower management payments this year to the operator (GLL)

A report goes on to say that the opening of the facility has “added internal costs that were not originally budgeted. The facility was originally due to open in Summer 2019 so the council has needed to retain the project team”.

The Council also says that there were changes to the design during the course of construction (additional signage, site boundary issues and cladding) which also added costs totally £458k.

The Council is hoping to get some compensation for the construction delays.

The stadium was 18 months late and has still not, because of COVID-19 regulations – been brought into use,

…and another football scheme gets into £300,000 budget difficulties

The plan to provide football pitches and a clubhouse for use by the Bishopthorpe football team on land off Sim Balk Lane was approved in June 2019.

Budget agreed in 2019

It was controversial as the Council agreed to contribute £850,000 towards the £1.5 million scheme, claiming that it would compensate for the loss of open space at Lowfields.

Residents were quick to point out the new pitches were 3 miles from Lowfields and that there wasn’t even a public transport link between the two areas.

Others commented that the clubhouse design seemed to be at the luxury end of the market.

One a more positive note, much improvements to the adjacent cycle path were promised as part of the project (they have not yet materialised)

It was agreed that the new facilities would be completed before the first homes at Lowfields were occupied.

Pavilion site last year

Now a Council report says that the delayed Bishopthorpe scheme is running £303,000 over budget. The costs of providing services to the pavilion are blamed for the increase.

The Council is now showing a contribution towards the project of £1,052,000 in its revised budget for this year. 

The report says that “£190k of additional funding has been identified to date, but this is not sufficient to cover the entire cost increase and the team is working to identify further funding to cover the remaining £113k overspend”.

No further details, an updated budget or completion timetable have been published.  

Council heading for £3 million budget deficit. £800,000 cost of keeping sports facilities closed.

With only a few weeks to go until the end of the financial year, the York Council says it will overspend by £3.7 million. Any deficit would be a charge on the Council’s reserves (which currently stand at £7 million)

Most of the deficit is blamed on the COVID-19 pandemic. Details can be found here

Council income has dropped with car parking revenue severely affected.

There are major overspends on children’s social work services including safeguarding vulnerable children with 93 local children currently subject to proceedings.

Adult social care could also overspend by £2.7 million.

There are also major pressures to bail out the indoor sports centres which are managed by GLL.

The council continues to have discussions with GLL over the cost of managing the centres during the year. The council has been required to fund the net cost of the facilities whist closed and GLL have suffered from reduced revenues when the facilities have been open during the year. The likely additional cost to the council is currently forecast to be c.£800k but the council and GLL are seeking Government / Sport England funding to mitigate this cost.

The main problems with Council housing relate to a repairs backlog and the lengthening time to relet empty properties.

The report contains a highly selective report on public service quality standards. It talks about the – entirely unsurprising – drop in bus usage.

It pointedly fails to mention the appalling decline in the standard of highway surfaces. Despite being reported long before the icy weather – and lockdown – commenced, potholes were only given cursory attention. The result now is that many carriageways are dangerous particularly for users of two wheeled transport.

& maybe part of the solution

Ward budgets under review

The York Council is reviewing how the £4.8 million budget, delegated to be spent pro rata in wards across the City, is being used. Those reading the report will be little the wiser.

Even before COVID struck, there was a marked lack of transparency on the budget process while prioritisation had become an almost mystic art.

 In most parts of the City, resident involvement – the principal objective of devolution – has been almost completely missing.

Originally, the money was apportioned to be spent on

  • Local improvements (something which has been happening in the City for over 20 years).
  • “Pride in York”,
  • Safer Communities (crime prevention),
  • Highways improvements, &
  • Council estate improvements (another long running programme which is funded from rents).  

The precise division of the budget can be viewed by clicking here

Muddy paths are unusable for exercise

 In the autumn the budget was top sliced to provide funding for COVID relief. A list of the schemes benefiting can be seen by clicking here.  £55,000 has gone to a limited number of organisations.

As with the rest of the report, there are few numbers detailing how many residents have actually benefited and in what way.

Promised investment in snicket repairs hasn’t happened.

While responding to the pandemic will be viewed as a worthy initiative, the report fails to detail the Councils response to many other requests for help .

For example, the lockdown has meant that many more people are exercising on local off-road paths. The result is that many are now showing major signs of wear and tear.

It is a similar situation with the off-road cycle network.

Ward spends are closely monitored and reported on, with all ward spending published as an online ‘Officer Decision Log’ and a regularly updated spreadsheet uploaded to the open data platform

York Council report January 2021

No updates on highways, pedestrian, cycling or estate improvement schemes are provided on the Councils open data web site.

The format of most officer decisions is impenetrable click

  All in all, the system has turned into a bureaucratic labyrinth which needs to be simplified and managed properly.

Transparency, proper performance management information and resident involvement would be  good places to start.