FINANCE DEVELOPMENT COMMITTEE - Cornwall Council · 2016. 8. 16. · Martin Emery – Committee Member : Emma Blatchford – Head of Resources . Jane Barlow ... as part of the Universal

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FINANCE & DEVELOPMENT COMMITTEE

Meeting to be held on Monday 22nd August 2016 Meeting Room 5, Chy Trevail, Bodmin at 9.30am

AGENDA

1. Welcome and apologies 2. Declarations of Interest 3. Minutes of the Meeting of 19 07 16 4. Health and Safety Strategy (EB) 5. Management Accounts P3 (SE) 6. Q1 Integrated Performance Management Report (EB) 7. Performance Framework (EB) 8. Utilities Financial Recovery Plan (SB) 9. ILS Service Expansion Action Plan (PJ)

10. Date of next meeting: The date of the next Finance and Development Committee is Monday 19th September 2016.

Minutes

Meeting Title: Finance and Development Committee

Date: 18th July 2016

Time: 11:30 am

Location: Meeting Room 4, Chy Trevail, Bodmin.

Chaired by: Nick Ball - Chair

Attendees: Steve Chamberlain – Committee Member Martin Emery – Committee Member Emma Blatchford – Head of Resources Jane Barlow – Managing Director Steve England – Interim Head of Finance Stuart Blackie – Housing Manager (Operations) Lorna Curnow – Governance and Control officer

Apologies: Peter Ledson – Committee Member Nigel Williams – Committee Member Derris Watson – Committee Member

Minutes Action

1 Welcome and Apologies

Nick Ball welcomed all to the Finance and Development Committee. The above apologies were noted. No declarations of interest were declared.

2 Minutes of the last Meeting

The Finance and Development Committee asked that updates on Performance be brought to each Committee before being presented to the Board. An update of the Actions plans on the red Performance Indicators will be presented to the next Committee in August before going to the CHL Board on the 6th

DLT

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Minutes Action September 2016.

3 Deep Dive: Sickness

Emma Blatchford presented an update on Sickness providing assurance that sickness within the Company is being monitored. In addition, the Committee were asked to approve for a temporary new post to support Managers during this time while the new processes are being implemented. Recruiting for the post internally was discussed, particularly as the post could be self-financing if a reduction in sickness was managed. The Committee members discussed the sickness report in detail, especially within the Asset Directorate where the sickness levels are higher than the rest of the Company. The Committee asked for a further update on Sickness as part of the September performance report.

EB

4 Totally Mobile Working

Emma Blatchford provided the Committee with an update on the Mobile working solution with a view to take this project forward. She explained the lead on the project is Allan Oldfield (Commercial Manager) and took the Committee through the process whereby an options appraisal had to be secured before a business case can be sent onto Cornwall Council for consideration. The view was expressed that the process of developing the Business case and the length of time of procuring the system would take time, but was necessary in order to get the system up and running. The Committee discussed the impact of Cornwall Housing purchasing the software as currently all software is owned by the Council.

5 Recruitment and Selection Policy

The Committee was asked to approve the Recruitment and Selection policy will be part of the framework which Cornwall Housing Managers will use to recruit staff.

EB

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Minutes Action The Finance and Development Committee approved the policy subject to minor amendments.

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Arrears Monitor and Welfare Report Q1

Steve England presented the report on rent arrears to provide assurance to the Committee that the arrears are being managed effectively. The report included the overall position on rent arrears (both current and former) for the last financial year 2015/2016 and the current financial year 2016/2017. Stuart Blackie attended the Committee to explain the effect of Universal Credit implementation is having on rent arrears among Cornwall Housing tenants. Currently the number of cases where rent arrears have increased is now 41; mainly where the tenants are already on Universal Credit. This number is expected to increase once the benefit cap is reduced in the autumn. Stuart Blackie explained water and rent arrears remain high at the Gypsy and Traveller sites. Proposals that may help reduce water arrears at Boscarn Parc were considered by the Committee. One of the preferred options discussed included reducing the weekly charge with the condition of fitting a water meter. The Committee requested that Officers negotiate with Cornwall Council to reduce the historic rent and water arrears, to help the future management of this debt, and bring a report on the total amount water arrears for the Gypsy and Traveller be brought back to a future Committee.

(Stuart Blackie left the Meeting at 12:55pm) Summarising the report, Steve England explained former tenant arrears have increased by £20k within the HRA, and similarly the arrears have increased within the General Fund. Steve England referred to the changes in Welfare Reform, which are having a direct effect on arrears. He explained with the introduction of Universal Credit to Cornwall in 2017, Cornwall Housing could see a rise in rent arrears when Cornwall Housing tenants move over to this. (Break held 12:00pm – 12:15pm)

SB/PJ

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Minutes Action

(Meeting resumed at 12:15pm)

7 PSL Rent Arrears

Cathy Hadfield asked the Finance and Development Committee to note the current position on PSL arrears, and action taken as part of the Rent Management policy. She explained that Cornwall Housing currently manages 180 units where arrangements mean that private property owners are guaranteed an annual rent which is payable whether the property is occupied or not. The Committee were asked to note that a review of this is currently underway, as the national subsidy arrangements will change as part of the Universal Credit implementation, likely from April 2017, which presents a financial risk in terms of rent collection Referring to the performance indicators, Cathy Hadfield explained that the numbers of current rent arrears on which the PIs are based on are very sensitive to change to levels of voids, rent due and to rent debit. Discussions with the Client are being held to assess whether performance monitoring of the PIs can be done more effectively. Highlighting individual case studies, Cathy Hadfield explained to the Committee the problems faced by Cornwall Housing when trying to collect rents where tenants have fallen into arrears. These include where Housing Benefit applications have not yet been processed and are pending and, where applicants have not been awarded an entitlements having been ‘capped’. Other areas discussed to enable performance improvements include improved management processes and reviewing joint working/HB liaison .

8 Management Accounts P2

Steve England presented the Management Accounts P2 and explained that there have been no further Budget movements since the last report and the reported that the surplus is currently at £450k, an increase of £16k on the original of £434k.

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Minutes Action He outlined the main areas of concern in the Landlord Services Directorate, which are the ILS (Independent Living Service) and Utilities. Reports on both areas will be presented to the Finance and Development Committee in August. He explained where a ‘bad debt’ provision had been made on all income from the Gypsy and Traveller sites, a further loss of £26k had been assumed on top of the £60k already reported. Within the Assets Directorate, recruitment of staff remains a concern leading to a potential impact on the areas of work carried out by the internal teams. It has been agreed that this will not include the capital works team. Steve England explained that confirmation has now been given by Cornwall Council Finance, which means no capital sampling will be undertaken in 2016/17. The Finance and Development Committee recommended that the Cornwall Housing Board approve the Management Accounts P2.

9 Date of the next Meeting:

The date of the next Finance and Development Committee will be Monday 22nd August 2016.

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Cornwall Housing Limited

Agenda No:

Report to: Finance and Development Committee

Part 1

Date: Monday 18 July 2016

Title: Health, Safety and Wellbeing Strategy

Author: Emma Blatchford Role: Head of Resources

Contact: [email protected]

Extn: 473291

Recommendations:

a. That the Finance and Development Committee, following consideration and comment where necessary, approves the draft health, safety & wellbeing strategy which sets out, in general terms, Cornwall Housing Ltd.’s (CHL’s) commitment to improving its health, safety & wellbeing (HS&W) management systems and culture over the next 3 years.

1. Executive Summary:

This report introduces the new Health, Safety and Wellbeing Strategy for consideration and approval. The key objective of the strategy document is to describe how Cornwall Housing Ltd. will commit to continually improving its standards of workplace health, safety & wellbeing for its employees, tenants and customers and bring benefits to the business in terms of reduced sickness absence and loss due to accidents, injury & ill health.

The ultimate aim is gain third party accreditation to BSI OHSAS 18001 or ISO 45001 which will eventually replace it. 2. Background and Cornwall Housing Objectives:

This is a new strategy provides the context and the direction of travel for the work we are undertaking in Health, Safety and Wellbeing within the company and sets out our direction of travel over the next three years. CHL recognises that there are clear legal, economic and moral reasons for effectively managing health, safety and wellbeing in terms of higher performance and more reliable operations & activities which, in turn, will make it a more attractive business partner.

mailto:[email protected]

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The strategy focuses on 3 key areas of capability & culture, systems & processes and a sensible & proportionate approach to risk management in delivery of the business. 3. Financial Implications and Budget:

CHL currently employs a full time H&S advisor and also a strategic HS&W consultant currently on a year’s secondment from Cornwall Council. This is a significant resource that will help drive the strategy in terms of HS&W policy & guidance etc. Additional resources have been included in this years budget to cover the cost of the secondment. These additional resources are not currently budgeted for next financial year.

As the strategy is implemented and projects are identified (e.g. health surveillance, HAVs monitoring) then there may be a requirement for additional resource in terms of occupational health provision, training etc. However, in terms of overall cost to the organisation, some or all of this may be offset by reductions in days lost due to sickness, accident and ill health and the reduction in the likelihood of material losses due to accidents and also civil claims.

4. Value for Money Implications:

As above

5. Other Resourcing Implications:

None 6. Legal Implications:

The Health & Safety at Wort Etc. Act (HASAWA) 1974 and regulations made thereunder requires employers to safeguard the health & safety of their employees including adequate resourcing. 7. Comprehensive Impact Assessment:

None 8. Significant Risks:

Budget Pressure / Risk

Impact Comments RAG Rating

Non-compliance with H&S legislation carries with it significant risk

Potential enforcement action, prosecution and potential civil litigation in the event of accident and injury. This will also have a further “knock on” effect in terms of the business

Significant work is being undertaken within the company to develop effective systems.

9. Consultation carried out including staff, SMT, Directors,

specialist advice and the community:

Jane Barlow, Emma Blatchford Operational Health and Safety Group

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Strategic Health, Safety and Wellbeing Group Supporting Information

Appendices: Appendix 1 – Health, Safety and Wellbeing Strategy Background Papers: None. Approval and Clearance of Report

Report cleared by: Date: Report Cleared by Company Secretary and Managing Director: Date:

Health, Safety and Wellbeing Strategy 2016- 2019 Cornwall Housing Treven Kernow

Date: 21/07/2016

Version 1.0

Cornwall Housing Ltd., Health, Safety and Wellbeing Strategy 2 Version 1.0, 21 07 2016, Author/s: Mike Lawton

Strategy control sheet

Current document information

Status Draft

Reference

Last reviewed

Sections amended since last version

Reason for change

Document type Strategy

Document location

Directorate applicability All

Version history

Version Version created

Date approved

Date for review Author/s Approved

by Revised by

1.0 Mike Lawton

26th July 2016

2019 Mike Lawton

Strategic Health and Safety Group


Notes: This strategy document sets out, in general terms, Cornwall Housing Ltd.’s (CHL’s) commitment to improving its health, safety & wellbeing (HS&W) management systems and culture over the next three years. That commitment is based around the three key focus areas of capability & culture, systems and processes and a risk based programme of continual improvement; the overall aim being to demonstrate robust governance & management arrangements, compliance with legislation and the development of a healthy and resilient workforce. Legal influences on this strategy: Health & Safety at Work Etc. Act (HASAWA) 1974 Numerous health & safety regulations made under HASAWA The Corporate Manslaughter & Homicide Act 2007 Non-legal influences on this strategy: Quasi-legal HSE Approved Codes of Practice relating to the legislation above. HSE Guidance documents Other relevant industry codes or best practice guides Other documents linked to this strategy:

General H&S Policy Statement Other relevant CHL Health, Safety & Wellbeing (HS&W) documents such as the action plan & other HS&W policies and strategies

Comprehensive impact assessment record

Date Type of assessment conducted

Stage/level completed

Summary of actions/decisions

Completed by

Impact assessment review date


Table of contents

Page

Strategy and Governance 5

Capability and Culture 5

Systems and Processes 5

Risk Based Improvement Programme 5

Governance 6

Compliance 6

Health and Wellbeing 6

Compliance – Managing Occupational Health Risk 6

Developing Resilience 7

Promoting Wellbeing in a Healthy Workplace 7

Safety 7


1. Strategy and Governance The health and safety of our employees, tenants and customers is imperative to our business. Striving for excellence in health and safety makes good business sense at a number of levels: it results in higher performing teams and more reliable operations and activities; and it makes us an attractive business partner. Cornwall Housing Limited (CHL) is committed to continually improving the standards of health and safety in the workplace and our aim is to gain third party certification for the HS&W management system to ISO 45001when the standard replaces BSI OHSAS 18001. Our vision and goals for health and safety and how we commit to achieve them are set out in our HS&W policy. This describes how performance improvement is delivered through a strategy that focuses on three areas: 2. Capability and Culture To instill HS&W at the heart of everything we do, we need consistent, visible leadership and commitment from managers at all levels. We must also engage effectively on HS&W with all our employees. HS&W will not be just a responsibility assigned to a particular person or part of the organisation but an integral part of everyone’s role. We aim to establish a much broader ownership of HSW issues by engaging with everyone who shares those responsibilities. 3. Systems and Processes As we continue to implement new systems across the whole of CHL there is a need for robust HS&W management. We are continually strengthening our HS&W management system, introducing a number of assurance programmes and sharing what we learn from incidents. 4. Risks Based Improvement Programme CHL believes that a sensible and proportionate approach to risk management is integral to delivering the business. This approach will support growth, encourage innovation and protect the organisation’s most vital asset, its people. Positive outcomes from this approach include reduced sickness absence, lower costs and an enhanced reputation.


We implement prioritised work programmes focused on key areas of risk. Recent examples include CDM, control of contractors and asbestos management. 5. Governance A robust health and safety governance framework helps us to monitor and direct improvements in management and performance. The Board has appointed a HS&W Champion and the Board receives from its Finance and Development Committee, quarterly reports on progress. We have forums that range from local team meetings right through to operational and strategic HSW committees, involving members of the Directorate Leadership team and Board. 6. Compliance We are committed to full compliance with all relevant legal requirements and we continually monitor performance across our business areas. Our HS&W management system will set out mandatory requirements against which we will monitor and evaluate compliance. This forms a key aspect of our management system framework that will be based on the requirements of the Health and Safety management systems standard OHSAS 18001. We are aiming for certification to ISO 45001 when it replaces OHSAS 18001. 7. Health and Wellbeing A healthy, resilient workforce is the cornerstone of a high performing organisation. Productivity and innovation thrive where workplace risks have been systematically controlled. This provides opportunities for us to enhance the personal health and wellbeing of our people. To achieve this, our Occupational Health Strategy focuses on three areas: 8. Compliance – Managing Occupational Health Risks The nature of our work has the potential to expose us to conditions that could harm our health. From noise and vibration to asbestos and manual handling, we are continually developing processes and controls to mitigate these risks. Our occupational health providers conduct a full range of statutory surveillance medicals to look for any early signs of occupational disease.


9. Developing Resilience We operate in an environment of continual cuts and re-organisation in an increasingly dynamic and competitive market all of which places significant demands on people. Our approach to meeting this challenge is to ensure that we equip individuals and teams with the training and tools necessary to enhance their resilience. This ensures that they are able to recover, learn and thrive in this environment. 10. Promoting Wellbeing in a Healthy Workplace CHL aspires to be a high performing organisation and to achieve this we need our people to be at their best. Only when we enjoy optimal wellbeing, both physical and mental, can we achieve and sustain high performance. This is why CHL is committed to improving wellbeing across its workforce. Various wellbeing events, activities and a dedicated action plan support the ambition of becoming a company that is recognised as being a healthy workplace and a high performing organisation. We aim to achieve gold status over a 3 year period, the benefits of this including a happy, motivated and efficient workforce. Work to attain the Investors in People accreditation will also help us to improve by achieving a recognised standard of people management and a mark of being a great company. Registration as a Mindful Employer will also demonstrate that we are seen to be an employer committed, equally, to both the physical and mental health & wellbeing of its employees. 11. Safety CHL is dedicated to providing a safe place of work for all its employees, tenants, contractors and visitors to our work places or housing stock. We continue to monitor our HS&W performance, both proactively and reactively, through a robust audit programme and regular review of the risk assessments. Significant accidents and incidents are investigated and lessons learnt are shared across the organisation. Introduction of a new "near miss" reporting will also enhance CHL’s proactive approach to risk management. This reflects our greater risk awareness, overall proactive reporting, risk based investigation and other improvements. We continue to focus our improvement programmes on high risk activities in accordance with our risk profile; examples being asbestos management, control of contractors and gas & electrical safety.


Alternative formats

Furvasow Erel

If you would like this information on audio CD, audio tape, Braille, large print, any other format or interpreted in a language other than English, please contact:-

Mar mynnowgh hwi kavos an kedhlow ma war son-sidi, sonsnod, yn Braille, prynt bras, furvas aral po styrys yn taves dres Sowsnek, kestevewgh mar pleg:-

Address

Cornwall Housing Ltd Chy Trevail

Beacon Technology Park Bodmin

PL31 2FR Telephone and Text

General enquiries and repairs: 0300 1234 161

Repairs (North East area): 01208 893489

Text: 07941 712 712

Email

General enquiries and South East repairs: [email protected]

Repairs (Mid): [email protected]

Repairs (North East): [email protected]

Website

www.cornwallhousing.org.uk




http://www.cornwallhousing.org.uk/

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Agenda No:


Part 1 Report

Date: 22 August 2016

Title: Management Accounts P3 - April 2016 to June 2016

Author: Steve England Role: Interim Head of Finance

Contact: Telephone/email :

01872 322781/[email protected]

Recommendations:

1. The Committee review and consider the contents of this report, and determine any further areas requiring investigation, and make any appropriate recommendations to the Board


This report presents Cornwall Housing’s management accounts for the first three months of the financial year ending 31st March 2016 as summarised within Appendix A, with the financial position of each Directorate summarised within Appendices B1 to B5 of this report. The management accounts surplus forecast for the full 2016/17 financial year of £464k is a £30k increase on the original approved budgeted surplus of £434k, and a small increase of £14k on the position forecast in the last report as at the end of May 2016.

2. Background and Cornwall Housing Objectives:

The production of management accounts underpin and support the delivery of all of Cornwall Housing’s objectives. 3. Decision and Supporting Information (Including Options):

The Finance & Development Committee is asked to review the current financial position of the Company, determine any further areas requiring investigation, and make any appropriate recommendations to the Board. There have been no further Budget Movements since the last report.


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4. Financial Implications and Budget:

This paper presents Cornwall Housing's management accounts, for the first three months of the financial year ending 31st March 2017, and the report includes the following appendices:

• Subjective Summary (Appendix A) • Directorate Summaries (Appendix B1-B5)

4.1 Analysis of the management accounts and summary position The management accounts surplus forecast for the full 2016/17 financial year of £464k is a £30k increase on the original approved budgeted surplus of £434k, and a small increase of £14k on the position forecast in the last report as at the end of May 2016.

The Committee should note that the overall management accounts surplus for the year will be presented in this and all future reports for 2016/17 at the Statutory Accounts level.

The Committee will remember that the Statutory Accounts do not make any distinction for use of reserves, with the Accounting Code of Practice considering this to be an internal matter for companies.

4.2 Key movements

The key reasons for the overall improved position as at the P3 forecast are set out below, with variances compared to the original CHL budget for the 2016/17 financial year. 4.3. Main variances While little change is forecast in CHL’s overall surplus for 2016/17, there are as usual a mix of underspends and additional pressures causing overspends. The Housing Options Directorate is again underspent by £86k (small reduction from £115k at P2 forecast) while Resources and Finance are broadly on target to budget at this stage. The main variances are in Landlord’s and Assets Directorates as follows :-

4.4 Landlords (Appendix B2) – Overspend of £156k (P2 overspend £143k) 4.4.1 Landlords - Gypsy & Traveller Sites – reduced net costs of G&T sites £5k (P2 overspend £27k) While there are still a number of issues relating to income collection and maintenance liabilities across the three sites, the full income due from the rentals and service charges increased in Sept 2015 was not included in the last report. Housing Benefit and Other Income collection levels have indicated that the additional bad debt provision (increased to £86k) assumed in the last report may not now be fully required . However there is still more work to do to bring back proposals to write off a number of charges (particularly water), from both before and since Cornwall Housing

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assumed all liabilities since April 2015, before any further adjustment to likely in year bad debt is made. 4.4.2 Landlords – Communal Areas Utilities – Overspend of £48k (P2 overspend £65k) Due to the 2015/16 overspend on utilities, new procedures for monitoring monthly charges have been put in place within CHL Finance for the 2016/17 financial year. A detailed review by Finance and Landlords has revealed that the budget for 2016/17 is likely be exceeded by £48k. A further more detailed report on utilities is on this agenda. 4.4.3 Landlords – Net cost of Independent Living Service (ILS) – Overspend of £26k (P2 Overspend of £24k) The original business case and 2016/17 budget for the ILS service indicated a net budget surplus of £28k for the service. A delay in expanding the service and achieving the expected income levels is expected to result in a reduction in income of £98k in the full year, offset by reduced costs of expanding the service in staffing, equipment and monitoring. A further more detailed update report on the ILS service is also on this agenda. 4.4.4 Landlords – Council Tax on Voids – Overspend £40k (P2 Nil) Despite the number of voids being similar in the first quarter to the forecast of over 800 for the full year and turnaround for end to end times improving, the charges being incurred to date indicate an overspend of £40k will occur in the full year against the target budget set. Much of the extra cost is being incurred on charges for those properties agreed for disposal by the Board which have not yet been finally sold off by the Council. These comprise £30k of the overspend reported above, with a prudent assumption that these properties will not be disposed of until the end of the financial year. Further discussions on this issue will take place with the Council before the next P4 report to this Committee. 4.4.5 Landlords – Tenant Decoration Allowances – Overspend £20k (P2 Nil) Again the charges being incurred to date indicate an overspend of £20k will occur in the full year against the target budget set. The Director of Landlords has been asked to bring forward proposals to reduce this expected overspend and/or to produce similar savings or reductions in expenditure elsewhere.

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4.5 Assets Directorate (Appendix B6) – Underspend of £145k (P2 underspend £75k) 4.5.1 Employees – underspend of £266k (P2 underspend £122k) Recruitment and retention difficulties are again leading to issues for the Assets teams and potentially this will impact on the amount of work the internal teams can do in a number of areas. However it has been agreed that this will not include the capital works teams and any reduction in internal capital works completed to date will be caught up later in the year. Difficulties in recruiting to the internal gas servicing team has contributed to this increased salaries underspend but this has been offset by additional use of external contractors at an estimated cost of £70k. 4.5.2 Capital Spend – Capital Expenditure less Capital Management fee – no change No adjustments have been made to date in respect of capital accounts for the 2015/16 year. However it has been confirmed verbally by CC Finance that provided CHL comply with monthly capital submission deadlines, then no capital sampling will be undertaken in 2016/17 and no capital management fee penalties are therefore expected. Increased expenditure has been forecast in this report on both Capital Improvement Works (£1,477k) and Development (£680k) due to slippage in both areas in 2015/16. These are fully matched by increases in the relevant fees paid by the Council. 4.5.3 Repairs & Maintenance External Contractors £70k overspend (P2 Nil) As indicated above £70k additional cost has been forecast within planned external contractor works due to difficulties in recruiting to the internal gas servicing team. This is however offset by an additional salaries underspend of £70k . This is the only increase forecast in this area despite higher than budgeted spend in Q1 to date in Reactive Repairs and on Painting . Reviews are in progress of the month end accruals in respect of reactive maintenance and in respect of the expected monthly spend on the painting contracts. At this stage no increase in budgeted spend for these two areas is forecast for the full year.

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A successful on target set of management accounts will give assurance that the Company is delivering efficiencies and striving to achieve the best and continuous value for money for the Board and the CHL tenants.


a) Property – N/A. b) HR/Staffing – N/A c) Information Services – N/A d) Procurement and Contracts – N/A

7. Legal Implications:

There are no legal implications arising from this paper.

8. Equality Impact Assessment:

There is no equality impact arising directly from this paper as no action is proposed.

9. Significant Risks:

Other areas that still need careful monitoring are detailed below:


Impact Comments RAG Rating

Demand on General Fund Services

Budget pressures on retained General Fund budgets results in management fee allocations being reduced and insufficient to fund service.

The MD and Director of Housing Options have been working with Cornwall Council to minimise the impact as far as possible with substantial cuts made in Housing Options in 2015/16. Only minimal reductions were made in retained General Fund budgets for 2016/17. Discussions are however in regular progress with the client (particularly regarding the viability of funding loan provisions), to agree proposals that will reduce GF costs in 2016/17 and all future years.

Amber

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G&T sites - rent collection and repair funding. Enforcing agreements and reputational risk.

Rent collection across the G&T sites falls below target and bad debt is higher than the tolerance in the financial plan, affecting levels of repairs & maintenance expenditure initially and then possibly leading to overspends impacting the rest of the company.

Since September 2015 arrears collection levels have not improved and arrears are exceeding the bad debt assumptions in the business case. An increase of £26k was assumed in the P2 report, and a separate update on G&T rent arrears and their recovery and enforcement has been recently presented to this Committee.

Amber

Assets Budgetary Control

Unexpected budget pressures arise for the company due to factors within the Assets Directorate ie

• works orders completion processing delays,

• lack of management information review by all teams and senior management in the Directorate,

• insufficient monitoring of contractor performance against target dates for job completion

Pressures have emerged late in the last two financial years causing additional overspends for the company against previous forecast positions for the relevant financial year. The implementation of a single housing management system has led to improvements in management reporting but constant review is required to ensure that all teams are processing all internal and external works orders completions promptly to enable better quality company wide financial and performance reporting.

Amber

10. Consultation carried out including staff, SMT, Directors, specialist advice and the community:

Consultation is carried out with Budget holders, Managers and Directors, Directorate management accounts have been discussed with budget holders, and approved for release for each Directorate by the responsible Director.

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11. Board committee: (For Board reports)

Supporting Information

Appendices:

• Appendix A Subjective Summary • Appendix B1- B5 Directorate Summaries

Background Papers: Approval and Clearance of Report

Report Cleared by Finance: Steve England, Interim Head of Finance Date: 8 August 2016 Report Cleared by Managing Director: Vivien Knibbs Date: 10 August 2016 Report Cleared by Director of Assets Date: 10 August 2016 Director of Housing Options Date: 10 August 2016 Director of Landlords Date: 10 August 2016 Head of Resources Date: 10 August 2016

Cornwall Housing Ltd.

Subjective Summary Appendix A

Period Ended 30 June 2016 Indicative End of Year Forecast

Budget Actual Variance Budget Forecast Movement

Income £'000 £'000 £'000 £'000 £'000 £'000

Capital Fee - Property Improvments 3,036 (244) (3,280) 12,145 13,622 1,477

Capital Fee - Development 974 - (974) 3,898 4,578 680

Capital Fee - Projects - - - - 169 169

Hendra Project - - - - - -

Revenue Management Fee 4,281 2,847 (1,434) 17,122 17,122 -

General Fund Management Fee 607 607 - 2,428 2,452 24

Recharges 18 89 71 72 167 95

Customer and Client Receipts 499 314 (185) 1,448 1,808 360

Financing and Investment Income - - - 15 15 -

Government Grants 21 22 1 83 100 17

Other Grants and Reimbursements - - - - - -

Total Income 9,436 3,635 (5,801) 37,211 40,033 2,822

Expenditure

Property Repairs

Reactive 210 341 (131) 839 839 -

Voids 217 143 74 868 868 -

Planned 331 489 (158) 1,326 1,396 (70)

Capital 2,216 2,017 199 8,863 10,341 (1,478)

Development Fee 975 406 569 3,898 4,578 (680)


G&T Site Development - - - - - -

Expenditure

Employee Costs 3,602 3,355 247 14,545 14,327 218

Materials 602 638 (36) 2,408 2,408 -

Capital IT projects - 35 (35) - 161 (161)

Premises Costs 311 404 (93) 1,243 1,461 (218)

Transport Costs 319 304 15 1,281 1,265 16

Supplies & Services 517 244 273 1,188 1,363 (175)

Third Party Payments 2 75 (73) 8 230 (222)

Tenants Payments 12 18 (6) 50 71 (21)

Depreciation and Impairment Losses 29 29 - 118 116 2

Asset Disposal - - - - - -

Recharges 3 43 (40) 142 145 (3)

9,346 8,541 805 36,777 39,569 (2,792)

Net Surplus/(Deficit) 90 (4,906) (4,996) 434 464 30

Contributions (To)/From Reserves:

Contribution to SIP Reserves - - - - - -

Contributions from New Business reserves (Offices) - - - -

90 (4,906) (4,996) 434 464 30

Z:\Financial Services\_Accounts\Budget Monitor\2016 BM (Odd Mths)\Reports (Odd Mths)\2017 Full Company Budget Monitor (Odd Mths) vJun 2016-07-07


Appendix B1

Directorate Summary - Managing Director


Budget Actual Variance Budget ForecastMovement

£'000 £'000 £'000 £'000 £'000 £'000

Income

Recharges - - - - - -

Customer and Client Receipts - - - - - -

Total Income - - - - - -

Expenditure

Employee Costs 120 108 12 646 636 10

Transport Costs 5 8 (3) 20 20 -

Supplies & Services 2 17 (15) 6 21 (15)


127 133 (6) 672 677 (5)

Net Surplus/(Deficit) (127) (133) (6) (672) (677) (5)


Contribution to SIP Reserves - -

Contribution from New Bus Reserves (Offices) - -

(127) (133) (6) (672) (677) (5)



Appendix B2

Directorate Summary - Landlord Services



£'000 £'000 £'000 £'000 £'000 £'000

Income

General Fund Management Fee 6 6 - 23 23 -

Customer and Client Receipts 362 228 (134) 896 1,065 169

Recharges - 12 12 - 41 41

Government Grants 17 17 - 66 83 17

Total Income 385 263 (122) 985 1,212 227

Expenditure

Employee Costs 446 448 (2) 1,783 1,828 (45)

Premises Costs 112 139 (27) 448 536 (88)

Transport Costs 29 31 (2) 117 112 5

Supplies & Services 134 69 65 329 343 (14)

Third Party Payments 1 75 (74) 3 225 (222)

Tenants Payments 12 18 (6) 50 71 (21)

Depreciation and Impairment Losses 25 25 - 102 100 2

Asset Disposal - - - - - -

Recharges 1 - 1 52 52 -

760 805 (45) 2,884 3,267 (383)

Net Surplus/(Deficit) (375) (542) (167) (1,899) (2,055) (156)


Contribution from reserves (SIP) - -


(375) (542) (167) (1,899) (2,055) (156)



Appendix B3

Directorate Summary - Resources



£'000 £'000 £'000 £'000 £'000 £'000

Income

Capital Income - IT Projects - - - - 169 169

Recharges - - - - 54 54


Total Income - - - - 223 223

Expenditure

Employee Costs 263 270 (7) 1,022 1,087 (65)

Capital Spend - IT Projects - 35 (35) - 161 (161)

Premises Costs 1 2 (1) 2 2 -

Transport Costs 10 8 2 41 40 1


Depreciation and Impairment Losses - - - - - -

Recharges - 41 (41) 82 85 (3)

395 476 (81) 1,582 1,811 (229)

Net Surplus/(Deficit) (395) (476) (81) (1,582) (1,588) (6)


Contribution from Reserves (SIP) - -


(395) (476) (81) (1,582) (1,588) (6)



Appendix B4

Directorate Summary - Finance



£'000 £'000 £'000 £'000 £'000 £'000

Income

Revenue Management Fee 4,281 2,847 (1,434) 17,122 17,122 -


Customer and Client Receipts - (9) (9) 1 1 -

Financing and Investment Income - - - 15 15 -

Total Income 4,281 2,838 (1,443) 17,138 17,138 -

Expenditure

Employee Costs 245 230 15 979 1,003 (24)

Transport Costs 6 3 3 23 23 -

Supplies & Services 231 (4) 235 305 315 (10)

Recharges 2 2 - 8 8 -

484 231 253 1,315 1,349 (34)

Net Surplus/(Deficit) 3,797 2,607 (1,190) 15,823 15,789 (34)


Contribution from Reserves (SIP) - -


3,797 2,607 (1,190) 15,823 15,789 (34)



Appendix B5

Directorate Summary - Housing Options



£'000 £'000 £'000 £'000 £'000 £'000

Income

General Fund Management Fee 601 601 - 2,405 2,429 24

Customer and Client Receipts 56 107 51 226 412 186

Recharges 18 1 (17) 72 72 -

Government Grants 4 5 1 17 17 -


Total Income 679 714 35 2,720 2,930 210

Expenditure

Employee Costs 590 559 31 2,397 2,321 76

Premises Costs 43 132 (89) 175 275 (100)

Transport Costs 20 27 (7) 82 72 10


Third Party Payments 1 - 1 5 5 -


670 732 (62) 2,720 2,844 (124)

Internal - Reactive SpendContributions (To)/From Reserves:

Net Surplus/(Deficit) 9 (18) (27) - 86 86


Contribution to Pay Reserves - Contribution from New Bus Reserves (Offices)

9 (18) (27) - 86 86



Appendix B6

Directorate Summary - Assets


Budget Actual Variance Budget Forecast Movement

£'000 £'000 £'000 £'000 £'000 £'000

Income

Capital Fee - Property Improvments 3,036 (244) (3,280) 12,145 13,622 1,477

Capital Grants - - - - - -

Capital Fee - Development 974 - (974) 3,898 4,578 680


Customer and Client Receipts 81 (12) (93) 325 330 5

Recharges - 76 76 - - -

Total Income 4,091 (180) (4,271) 16,368 18,530 2,162

Expenditure

Externally Contracted Property Repairs

Reactive 210 341 (131) 839 839 -

Void Repairs 217 143 74 868 868 -

Planned 331 489 (158) 1,326 1,396 (70)

Capital 2,216 2,017 199 8,863 10,341 (1,478)

Development Fee 975 406 569 3,898 4,578 (680)


Capital Spend - Projects - - - - - -

Employee Costs 1,938 1,740 198 7,718 7,452 266

Materials 602 638 (36) 2,408 2,408 -

Premises Costs 155 131 24 618 648 (30)

Transport Costs 249 227 22 998 998 -

Supplies & Services 13 28 (15) 52 77 (25)

Depreciation and Impairment Losses 4 4 - 16 16 -


6,910 6,164 746 27,604 29,621 (2,017)

Net Surplus/(Deficit) (2,819) (6,344) (3,525) (11,236) (11,091) 145

Contribution from Reserves (SIP) - Commercial Manager - -


(2,819) (6,344) (3,525) (11,236) (11,091) 145


1


Agenda No:


Part 1

Date: 22 August 2016

Title: Performance Management Framework

Author: Emma Blatchford Role: Head of Resources

Contact: Tel: 01208/ 893291

Email: [email protected]

Recommendations:

1. That the Committee consider the proposed framework and, subject to any suggested amendments, endorse its adoption.

2. Acknowledge the priority list of Key Support Activities.


The proposed framework sets our corporate standard in terms of establishing a companywide reporting solution. It is a key component in demonstrating that we have in place effective systems to deliver the high standards of governance required for the financial responsibilities and management freedoms the Council has delegated. The framework has been designed to enable the alignment of our strategic priorities, operational focus and individual activity through an ongoing process of evaluation, confirmation and action – the golden thread linking the Council’s strategic objectives through to individual Cornwall Housing activity. 2. Background and Cornwall Housing Objectives:

Between Cornwall Council and Cornwall Housing the Contract Management Framework (Schedule to the Management Agreement) provides: 1. Clarity on the outputs and outcomes expected of CHL. 2. Details the relationship between the two organisations. 3. Sets the tone for a co-operative and constructive working environment, and 4. Supports continuous improvement in housing services.

2

Our Performance Management Framework, and associated arrangements, compliment the contract management obligations through a single set of objectives.

• Achieving the Cornish Housing Standard, and maintaining our homes,

• Creating new homes, • Efficient use of resources, • Excellent Housing Services, and • Good governance and tenant involvement.

Through the adoption of an integrated performance framework, aligned to the Council’s strategic objectives, we will be able to demonstrate that we have the approach, mechanism and accountabilities necessary to manage our continual improvement. 3. Decision and Supporting Information (Including Options): Effective business improvement necessitates both agility and flexibility, and is informed by effective decision making and governance. The effectiveness of decision making is directly correlated to having the best, most up to date and accurate data sets available. The framework and proposals contained within this report provide the assurance basis required by management to control our direction of travel. To support the company’s continual improvement activities, a number of key enabling activities have been identified:

1. Obtain and retain Investors in People Status to ensure the people of the organisation have the necessary skills to deliver high performance.

2. Place the customer at the heart of our services by aiming to achieve the Customer Service Excellence.

3. Be involved in HouseMark benchmarking exercises and specific clubs for target areas of the company.

4. Ensure the organisation is properly governed via an ongoing review of our own Corporate Governance.

5. Deliver Value for Money via our VFM Strategy.

6. Operate a clear complaints system and report on the analysis of complaints annually to Service Committee.

7. Survey customers at key points of contact and report lessons learnt.

8. Complete Annual Roles and Goals across the company.

9. Achieve the NPSS Gold Standard for Housing Options.

10. Achieve BS OHSAS 18001 Occupational Health and Safety Management (OHS).

3

4. Financial Implications and Budget: This report has no direct impact on the budget. 5. Value for Money Implications:

None

6. Other Resourcing Implications: None 7. Legal Implications: Non-compliance with agreed standards 8. Equality Impact Assessment: N/A 9. Significant Risks:


Impact Comment RAG Rating

Links to: Failure to achieve performance targets

Ability to make quick, confident and accurate decisions is constrained by performance reporting that does not reflect progress of the business strategy.

Monthly monitoring of performance by DLT. A consolidated reporting approach – linking risks, KPI’s, business improvement projects and corporate programmes.

9

10. Consultation carried out including staff, SMT, Directors,


DLT Supporting Information

Appendices: 1. Performance Management Framework Background Papers: None Approval and Clearance of Report

Report cleared by: Emma Blatchford Date: Report Cleared by Managing Director and Company Secretary: Date:

Performance Management Framework Cornwall Housing Treven Kernow

Date: 20th July 2017

Version 0.1

Cornwall Housing Ltd., Performance Management Framework 2 Version 0.1: 20/07/2016 Author/s:

Strategy control sheet

Current document information

Status draft

Reference

Last reviewed

Sections amended since last version

Reason for change

Document type

Document location

Directorate applicability

Version history

Version Version created

Date approved

Date for review Author/s Approved

by Revised by

0.1 20/7/2016 A Forward

Equality impact assessment record

Date Type of assessment conducted

Stage/level completed

Summary of actions/decisions

Completed by

Impact assessment review date


Notes: Legal influences on this strategy: Non-legal influences on this strategy: Other documents linked to this strategy: Risk Management Framework


Contents

1. Purpose 5

2. Performance Management at CHL 5

3. Management Framework 6

4. Performance Reporting 6

5. Evaluation 8

6. Key Support Activities 9

Appendix 1 10 Performance management reporting arrangements 10

Appendix 2 11 The planning year 11


1. Purpose The purpose of the Performance Management Framework is to set our corporate standard in terms of establishing a companywide reporting solution. It facilitates effective monitoring of all Company activities undertaken in pursuit of our strategic objectives. The framework supports and links back to Cornwall Council’s Management Framework and will flex to meet the requirements of CorServ.

Managing our performance is simply a process of deciding what we need to achieve, measuring our progress and using the results to improve our service delivery. Our framework provides a platform that consolidates our management information into a single version of the truth, enabling effective decision making and the delegation of accountability across the organisation - a template that can be used at all levels within the organisation, facilitating the golden thread. It allows for the responsive management of services to ensure they are delivered to a consistently high quality and provides an understanding of how we compare to other landlords through benchmarking performance, costs and customer satisfaction on a regular basis.

2. Performance Management at CHL We are a council-owned company providing housing services for the Council. Our activities contribute towards the achievement of the Council’s objectives, specifically defined within the Housing Strategy. Our performance framework enables the alignment of our strategic priorities, operational focus and individual activity, through an ongoing process of evaluation, confirmation and action. Establishing that: 1. We are clear about what needs to be done; 2. We have effective mechanisms in place to deliver this; 3. We review, analyse and report regularly on progress; and 4. We evaluate progress and take action as needed to ensure success. We have adopted an integrated approach to performance management reporting. Reporting information on budgets, performance indicators,


improvement programmes and risks, enables us to plan, monitor and manage our performance to ensure we deliver the best services we can.

3. Management Framework We have established an appropriate, and practical, strategic management framework. Based on the European Foundation for Quality Management Excellence Model our framework provides not only a self-assessment tool but also a route map for positioning existing initiatives, removing duplication and identifying gaps – all within a structured management system.

The framework is based on nine criteria: five are ‘enablers’ and four are ‘results’. Enablers cover what we do, results cover what we achieve: results are caused by enablers, and enablers are improved using feedback from results – which introduces the plan-do-check-act continuous improvement cycle.

4. Performance Reporting Clearly progress against the management framework requires a reporting mechanism – as indicated in the KPI box. Through the adoption of a ‘balanced scorecard’ approach we have the means to link strategic objectives with short-term actions; a method for translating the vision. A balanced scorecard supplements both traditional financial and ‘lag’ performance measures. It does this through the inclusion of criteria that measure performance from four additional perspectives 1. Customers, 2. Internal business processes, 3. Learning and growth, and 4. Financial.


It will enable us to simultaneously monitor progress in building capabilities and acquiring the intangible assets that are needed for future growth.

To monitor staff delivery against our vision and strategy, there is a need to express those aspirations as an integrated set of objectives, measures, targets and initiatives. In this way we can group our performance measures, risks, programmes and projects, alongside our budget and financial reporting (both revenue and capital). Managing strategy involves four main processes, which converts our Vision into an Operational Plan. 1. Translating the Vision: expressing the strategy and vision aspirations in terms of operational activities that can guide action at a ‘local’ level. This will include:

A. Evaluation of the external environment assessing opportunities and threats to and from the business. Establishing the impact of these against the organisations goals and values.

B. Evaluation of the internal environment assessing the resources available and previous performance delivery.

C. Consultation with all relevant stakeholders (including but not limited to customers, staff and partners/stakeholders).

2. Communicating & linking: delegate managers to communicate the strategy throughout the company, linking it to service, team and individual goals.


3. Business Planning: use the scorecard measures as the basis for allocating resources and setting priorities-undertaking only those initiatives that support our strategic priorities. 4. Feedback & learning: Regular reporting against the scorecard will enable management interventions that reflect real-time learning. All targets for the organisation are SMART (Specific, Measureable, Achievable, Realistic, and Timely). Performance against target is monitored and colour coded as follows: Spar.Net: a linear analysis of performance against target (within pre-set variance). Reported against pre-set status categories: ‘Well Below Target; Below Target; On Target; Above Target, and Well Above Target. Example of the reporting:

This report provides a visual of the current trend and narrative against key activities and milestones, as well as a progress update.

5. Evaluation The company looks for year on year improvement in performance with an overall aim of achieving and maintaining top quartile performance in key business areas.

Monitoring of these plans is carried out monthly via Senior Leadership Team and at Directorate Leadership meetings. Reports are made quarterly to Finance and Development Committee, Board and Tenant’s Forum on the Key Performance measures. These Key Performance Indicators are then reported together with any comments to the client and to Corserv. Where goals have been met, the company celebrates success. Where performance has not been met or goals not achieved this is analysed as part of the annual corporate plan review.


6. Key Support Activities To support the company’s continual improvement activities, a number of key enabling activities are planned for the coming 12 months:

1. Obtain and retain Investors in People Status to ensure the people of the organisation have the necessary skills to deliver high performance.

2. Place the customer at the heart of our services by aiming to achieve the Customer Service Excellence.

3. Be involved in HouseMark benchmarking exercises and specific clubs for target areas of the company.

4. Ensure the organisation is properly governed via an ongoing review of our own Corporate Governance.

5. Deliver Value for Money via our VFM Strategy

6. Operate a clear complaints system and report on the analysis of complaints annually to Service Committee.

7. Survey customers at key points of contact and report lessons learnt

8. Complete Annual Roles and Goals across the company

9. Achieve the NPSS Gold Standard for Housing Options

10. Achieve BS OHSAS 18001 Occupational Health and Safety Management (OHS)

These link the Performance Management Framework to the Corporate Plan.

Appendix 1

Performance management reporting arrangements

Cornwall Housing Board

CORSERV Cornwall Council Client

DLT

Senior Managers

Operational Staff

Tenants and stakeholders

KPIs Quarterly TBD Quarterly Monthly Monthly Quarterly Quarterly

Business Plan

Annually TBD Annually Quarterly - - -

Corporate plan

Quarterly TBD Quarterly Quarterly Annually Annually Annually

Service Plans

Annually TBD Quarterly Quarterly Monthly Monthly -

Regulatory Code

Continuous TBD Continuous Continuous Continuous Continuous Annually

Policies Annually or longer

TBD - Continuous Continuous Continuous Continuous

Complaints Annually TBD Quarterly Quarterly Quarterly Monthly Quarterly


Appendix 2

The planning year

Septe

mber

Oct

ober

Novem

ber

Dece

mber

January

Febru

ary

Marc

h

April

May

June

July

August

Septe

mber

Benchmarking

Corporate Plan

Objectives Vision and

values

Publish Performance Information and consult

Monitoring & feedback

Budget Setting

Key Performance Indicators

Service Delivery Plans

Business Plan

Roles and Goals

Team and Individual Targets


Alternative formats Furvasow Erel

If you would like this information on audio CD, audio tape, Braille, large print, any other format or interpreted in a language other than English, please contact:-

Mar mynnowgh hwi kavos an kedhlow ma war son-sidi, sonsnod, yn Braille, prynt bras, furvas aral po styrys yn taves dres Sowsnek, kestevewgh mar pleg:-

Address

Cornwall Housing Ltd Chy Trevail

Beacon Technology Park Bodmin

PL31 2FR

Telephone and Text

General enquiries and repairs: 0300 1234 161

Text: 07941 712 712

Email

Website

www.cornwallhousing.org.uk

http://www.cornwallhousing.org.uk/

1


Agenda No:


Date: 22nd August 2016

Title: Utilities Report - Current Situation and Action Plan

Author: Lindsey Smitham Role: Data Manager (Service Charges)

Contact: 504286 [email protected]

For Board reports only

Committee: Name of committee

Date: Date of committee meeting

Recommendations:

1).That the Finance and Development Committee note the report and agree the action plan for keeping this area of spend under control.


The purpose of the report is to provide the committee with the current situation regarding all of Cornwall Housing’s utilities. The report details what work has been done to date, the financial benefit of that work, which includes nearly £80k of electricity charge refunds in the last financial year and £6k so far this year. These are year on year savings. We have reduced the overall utilities spend by over £56k in the last financial year compared to the previous year. These have more than justified the salary of the 0.6fte officer. The work of unravelling this highly complex area should potentially show further savings in the future. However, the report also highlights the problems and complexities encountered when dealing with utility suppliers and the length of time it takes to resolve identified issues. It also provides details about the work that our Energy Consultants, Monarch, carry out for Cornwall Housing and the history behind how this partnership was established. Finally, there is an attached action plan that summarises what actions we still need to take to get this area fully under control and within budget. 2. Background and Cornwall Housing Objectives:


2

When Cornwall Housing set up in 2012 the area of utilities spend originally fell within the Finance directorate. The budget was consistently overspent but transferred to the Landlord Services Directorate at the start of the financial year 2014/15. We did not necessarily have the resources within the directorate at that time to sort out the numerous issues that there were. The budget has never really been sufficient for the spend, however, until now we have never understood what our true costs are or should be. As part of the Service Charge Review, utilities were a large area of untested expenditure, it was decided that these costs would be investigated due to the high level of spend in this area. These initial investigations were also put in place in order to support the need for efficiencies due to CHL’s financial status during the last financial year. The focus of the Data Manager (Service Charges) was completely turned to looking at utility charges and issues and tasked with trying to resolve these. At this time we had requested ‘cost and consumption’ reports from our two largest energy suppliers. It was apparent from these reports, that the bills had not been monitored and some sites were costing huge amounts of money. This was particularly the case with the British Gas contract covering properties in the North and East, which was originally procured and administered by Cornwall Council. Further investigations into the size and use of the properties raised even more cause for concern e.g. Stairwell lighting in a block of six flats £24,000 per year, a bungalow with PNC equipment £4,000 per year, a store room costing £2,000 per year. In order to verify why the costs were so high it was decided to carry out a programme of meter readings, targeting the highest cost sites first. As the meter readings were sent off to the various suppliers questioning their costs, the difficulties in dealing with the suppliers became apparent. Problems dealing with the suppliers British Gas has been incredibly difficult to work with and to obtain information from. The highest cost site identified was Ringway, Bodmin. Cornwall Housing provided readings for this block back in May 2015 which proved that Cornwall Housing had been overcharged and was due a refund of £48,625.49. However, after numerous attempts to chase the refund, it was finally received at the end of August 2015. This issue took a total of 4 months to resolve. There have been other issues with British Gas such as incorrect Direct Debits which could not be backed up with invoices. This was identified promptly, payments stopped and reclaimed.

3

British Gas statements also need regular checking as a number of errors were made on the Cornwall Housing account. These errors took another 3 months to resolve. EDF Energy is another culprit. It has taken over 9 months to sort out the accounts and invoices for Polruan Hostel. EDF failed to process transferring the account from Cornwall Council to Cornwall Housing Ltd. As well as setting up and running two accounts for Polruan, EDF also failed to process the VAT declaration which meant that Cornwall Housing were being over-charged on the accounts due to EDF’s overbilling and the wrong rate of VAT being applied to the account, this resulted in a credit on the account of £3,763.63. After another 6 weeks of chasing, the cheque was received on 26th July 2016. Polruan Hostel is now the subject of a separate account with SSE. Trewithen House – Total Gas and Power, the supplier for Trewithen, has been chased for the 4th time since December 2015 to finalise the gas account. Contact was again made on 6th July 2016 and assurance has been given that the account will be closed down and final invoices supplied. In addition to the issues with Total Gas and Power, there have been ongoing debates with Cornwall Council with regards to the handover date. Current Cornwall Housing Group Contracts: Non Half Hourly Electric – Opus Energy – 1 July 15/1 October 15 to 30 September 2018 - £206,100 Annual Cost – 1,713,500 Annual kWh Half Hourly Electric – EDF Energy – 1 April 2016 to 30 September 2018 - £16,926 Annual Cost – 160,000 Annual kWh Gas – Scottish & Southern Electric – 1 August 16 to 31 July 2019 - £6,902 Annual Cost – 244,000 kWh Electricity – British Gas – There are 9 residue sites from the old Cornwall Council Contract. The contract is out of date so these properties will be picked up on a temporary contract arranged by Monarch, along with the other rogue sites, detailed below. These should then merge into the existing group contract, currently with Opus, when it is due for renewal. Identifying rogue sites not on the contracts Cornwall Housing receives a number of individual invoices in respect of utility bills for communal services. These sites do not appear on any of the group contracts. It has been necessary to interrogate ERP to identify

4

utility invoices received over the last couple of years in order to make sure that all sites have been identified. It has also meant contacting various suppliers to make sure that the invoices for landlords supplies are sent to Cornwall Housing. The details of these sites have been given to Monarch, our Energy Broker, with a view to putting them into a small group contract until such times as they can be merged into the main account. There are currently 39 such sites that we have identified. Meter Readings The majority of sites have had at least one meter reading. The Cat II sites should be having meter reads on a monthly basis. However, due to staffing issues in the ILS over the last few months, readings had reduced. This has been discussed with ILS team leader and readings are now in the process of being taken. As explained the high cost sites were the priority for meter reading and this has taken a great deal of time co-ordinating, following up readings and resolving identification issues etc. The list of sites has now been re-issued to implement the rolling meter reading programme, area by area. The Health and Safety Surveyor/Inspectors were requested to re-start the readings and photographs initially on the sites where they carry out the H & S inspections and then across the stock. However, their Manager advised that the team does not have the capacity to read all the meters. They can only read the ones where they are carrying out the inspections. This means that a number of sites that do not receive a Health and Safety inspections will not have a meter reading, including sewage plants. The later sites have not, to date, been read. Without consistent meter readings it is not possible to maintain full control of expenditure in this area. Regular meter readings are required in respect of our sewage plants etc. It has been difficult to allocate a resource from within the company to attend these sites, however, the contractor who carries out the regular maintenance had agreed to do this on our behalf when on site. The first readings from the contract arrived on 18th July 2016, however, there are no photographs to back up the evidence. In addition to identified meters, there is a separate list of 45 sites that have queries and these have been passed to Mike Day (Electrical Services

5

Manager) and his team to try in trace the wiring back to locate, verify and read the meters. However, this work can only be fitted in between their normal daily workload. So progress is slow. There are also sites which cannot be accessed as the communal supply meters are located in tenants/leaseholder flats or garages. Ongoing contact with occupiers is continuing to try and resolve this situation. Once accessed, it will be necessary to plan to have these meters relocated into the communal areas to make future meter reading easier. There are currently 190 metered sites on the Opus contracts Identifying Individual Supplies Throughout the meter reading process it has become clear that it is not always obvious which meters feed which communal areas. On that basis, once all the meters have been located and verified, the next exercise will be to identify exactly what communal areas the meters are feeding. This will be necessary in order to accurately apportion the appropriate charges to the relevant tenants and leaseholders. As a suggestion, if supplies remain difficult to identify, it may be necessary to introduce a programme of temporarily disconnection of the communal supply to identify what areas it services. This is expected to be a substantial piece of work. Smart Meters As part of CHL’s Electricity contract with Opus Energy, Cornwall Housing by agreeing to purchase 136 smart meters, were given 23 smart meters free of charge. The benefit of smart meters is that they remotely relay meter readings to a collection company who in turn, liaise with Monarch and the supplier. This removes the necessity to have a resource to carry out a physical site visit. However, ad-hoc reading can still take place to verify data collection. Unfortunately, Opus has been very slow in liaising with CHL in organising the installation of these meters. This was raised as a priority issue with our Energy Consultants, Monarch in our meeting on 24th June 2016. Consequently, since that meeting, Opus has now provided a list of sites eligible for these smart meters.

6

The Data Manager (Service Charges) will now need to spend time adding to the site information for the supplier in order to aid the installation process. However, in order to facilitate collating the necessary site information, the Data Manager will need assistance from either the Electricians or the Surveyor/Inspectors who carry out the Health and Safety inspections. Contact with Managers will be undertaken in the near future to start this process. Unmetered Supplies There are 7 sites that use unmetered electricity supplies. Some of these unmetered sites are high cost. Consequently it may also be worth considering whether to replace these unmetered sites with meters, as there have been issues with invoices not clearly stating what the invoices covers, as the records are too old or do not even exist. However, before taking this step, an electrician would need to survey all of the unmetered sites to collate an inventory of what is being serviced by the supplies. It should then be possible to calculate the potential cost to see whether a meter would be more beneficial. Problems with invoice payments An additional problem is the payment of utility invoices. This is predominantly a finance function, but is carried out by one member of staff in team support, around the other normal functions of their role. As part of the year end process, it was discovered that there was a backlog of void property utility invoices, back to December 15. Also Monarch has had to chase a number of missing payments for various utility suppliers. This has resulted in Cornwall Housing being subject to a number of late payment charges, as a result of not processing invoices in a timely manner. The Data Manager has also been involved with chasing copies of invoices in respect of final demands, or invoices that have been passed to a debt collection agency because they have not been paid. It is appreciated that Team Support has a range of duties to carry out, which means that it not always possible to give invoice processing the appropriate level of priority.

7

Landlord Services and Assets may wish to consider the urgent need for a resource to process all communal bills, including void utilities as part of the Facilities Management Role/Section to enable accurate and reliable payment. Whilst CHL is currently working with Monarch to establish a dashboard that will help to profile budget spend in order to track likely trends, if invoice management is poorly administered, there will be little benefit of this data and it is likely that budget problems will continue. Gas Sites There have been ongoing issues with Gas supplies across the stock as Cornwall Housing have been paying for supplies which should have been capped off as they are no longer in use. For instance, at George Street, Truro, the gas has been disconnected however, as all of the pipework etc is still on site, a standing charge remains payable. Another example is Saracen House, Penryn. CHL for a number of years, have been paying for a gas supply, despite tenants have their own individual gas supplies. Further investigation showed that CHL has been funding the gas supply for the office used by Penryn Town Council. A backdated invoice has been sent to Penryn Town Council totalling £7,503.86. We currently have eight separate gas sites including Trewithen House which we are trying to off-load to Cornwall Council. Water Sites There are around 50 sites that have been identified. These now need researching in detail. It is possible that some of these supplies can be disconnected, however, a discussion with the relevant Assets staff will be needed before this can progress. New water supply regulations come into force in April 2017 which will result in water users being able to choose their supplier. Monarch will be able to assist CHL with water procurement to ensure best contract price for both CHL and customers where appropriate. The account information will be sent to Monarch when the sites have been checked to see if the water supply is necessary.

8

The Data Manager has also been supporting the process of recording usage and costs for the Gypsy and Traveller site water charges. This support continues. Oil Sites There are only 2 sites that use oil across the stock which CHL manages, which are Clease Meadow, Camelford and Ponsmere Court, Perranporth. Whilst these accounts have been relatively simple to monitor, they will be passed to Monarch to investigate whether there would be a more cost effective contract available. The Monarch Partnership The Monarch Partnership has been working with CHL and its predecessors since November 2009. This is a brief outline of how this working relationship was instigated. The appointment was to complete utility procurement work for both Carrick’s Electricity and Gas, in addition to invoice bill validation work for all supply billing. Simon Quantrell-Evans has been the appointed Account Manager/Executive Relationship Manager for both Carrick Housing & Cornwall Housing since November 2009 and his Account Team has always performed the bill validation process for both Carrick and Cornwall Housing. (See Appendix B Contract Prices/Savings made by using the Monarch Partnership) 3. Decision and Supporting Information (Including Options):

An action plan is attached to this report that requires the approval of this committee. Moving forward , there is a proposal in the current restructure within the Assets Directorate, for a Facilities Management post that will take over the responsibility for this area of work.

4. Financial Implications and Budget:

The closer monitoring of the utility bills has resulted in refunds and account adjustments totalling £78,900 in the year 2015-16 and around £6,000 in the current year 2016-17. These are year on year savings. This evidences that the resource committed to this work has been worthwhile. However, the correct levels of account monitoring needs to continue if the utility bills are to be managed efficiently. This will also ensure that when CHL is in a position to charge tenants and leaseholders for communal utility costs, that these charges will be appropriate, transparent, fair and robust if challenged. Budget Spend 2013/14 174,203 244,599 2014/15 158,560 258,325 2015/16 138,560 201,884

9


The use of Monarch as our independent broker ensures that CHL has access to the most competitive large-scale contracts available, with the knowledge that every invoice is validated and checked every month.

With Cornwall Housing putting in regular meter reading schedules and with the greater use of smart meters the cost of utilities should be more accurate and easier to monitor and control in the longer term.


a. Property - None

b. HR/Staffing – None.

c. Information Services – None currently, however, there will be

future IT considerations if further service charges are implemented.

d. Procurement and Contracts – None

7. Legal Implications:

When charging tenants and leaseholders for communal services, it is essential; that charges are correct, fair and transparent. Failure to ensure this leaves both Cornwall Housing and Cornwall Council open to legal challenge. CHL has already sought external legal advice advising that the conditions of tenancy will need changing in order to accommodate the introduction of service charges. The Right to Buy and Leasehold Manager had started to go through the various leases to record whether or not additional service charges could be added. This work is yet to be completed. A new concept note has been issued by the CIH with regards to rent de-pooling. This advises that landlords could benefit by de-pooling their rents and adding in service charges. Whilst rent is decreasing, service charges are subject to different legislation and are not subject to the 1% rent reduction. Service charges are varied in line with CPI or with the cost of the actual service provided. By de-pooling rent and introducing service charges, Cornwall Housing would be in a position to recover some of the revenue lost by rent reduction.

10

8. Comprehensive Impact Assessment:

N/A 9. Significant Risks:

Potential significant risks: Legal challenge from any tenant/leaseholder currently being charged for communal utilities and future challenge when introduced across the stock. Damage to reputation if CHL is legally challenged and is shown not to have robust and evidenced service charge levels. Financial risk that utility costs are in excess of actual levels if management of these accounts is poor. Damage to reputation due to non-payment of invoices. 10. Consultation carried out including staff, SMT, Directors,


N/A 11. Board committee: (For Board reports)

N/A Supporting Information

Appendices: A = Action Plan Background Papers: Approval and Clearance of Report

Report cleared by: Pete Jarman Date: 29th July 2016 Report Cleared by Finance: Kim Lewis Date: 5th August 2016 Report Cleared by Company Secretary: N/A Date:

Utility Charge Action Plan

Issue Action Action Owner/Directorate

Other Involvement

Timescale

1). Not all sites are currently having their meters read regularly

Develop a programme to read all meters at all sites

Lindsey Smitham – Landlord Services

Assets directorate Start – July 2016 Completion – End of December 2016

2). Meter readings not taking place at sewage plants

Develop a programme of meter readings at sewage plants


Contractors Start - July – Completion End of August 2016

3) Not all locations of meters known

Electricians to trace back wires to locate and verify meters

Mike Day - Assets Start – April 2016 Completion – End of March 2017

4). Some meters are located within tenanted properties

Relocate meters in tenanted properties to communal areas

Mike Day - Assets Start – December 2016 Completion End of June 2017

5). Communal areas served by many meters unknown

Verify exactly what communal areas some meters supply inc temp. disconnection

Mike Day - Assets Start – September 2016 Completion end of March 2017

6). No smart meters installed as yet

Roll out programme of agreed smart meter installation


Monarch, OPUS Start – Sept. 2016 Complete – End of June 2017

7). Some sites still unmetered

Survey all unmetered sites and install meters where appropriate

Mike Day - Assets Start Sept. 2016 Complete – End of March 2017

8). Blockages in invoice processing

Improve process of invoice processing

Vicky Brooke – Resouces??

Finance Start –August 2016 Complete – End of Sept. 2016

9). No Facilities Management currently exists within company

Set up FM within Assets restructure

Adrian Pengelly - Assets

Start Sept. 2016 Complete – End of October 2016

10). Budget profiling not yet fully developed

Develop budget dashboard to profile budget spend more accurately

Lindsey Smitham - Landlords

Monarch, Finance Start -Sept. 2016 Complete – End of Dec. 2016

11). 40 water sites where we are unsure that we still need a connection.

Identify and research 40 water sites for possible disconnection


Assets Start – Sept 2016 Complete – End of March 2017

12). No procurement exercise done for oil sites

Engage Monarch to procure best value for oil sites


Monarch Start - Dec. 2016 Complete – End of March 2017

Documents

FINANCE DEVELOPMENT COMMITTEE - Cornwall Council · 2016. 8. 16. · Martin Emery – Committee Member : Emma Blatchford – Head of Resources . Jane Barlow ... as part of the Universal