The Agency is on track to achieve its planned outcomes this year. The Agency is forecasting that it will deliver spend within the resource ceilings set by Defra in their Grant in Aid letter of June 2002, following the lifting of the transport budget...
Countryside Agency Archive

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Third Quarter Report (AP03/01)

Principal Managers Responsible: Jeff Smallwood and Fiona Hope Lead Board Member: Martin Doughty

FOR INFORMATION

 

Recommendations:

Ÿ         To note progress towards planned outcomes and financial outturn by the Third Quarter of 2002/03

 

 

Relevance to Strategy and Corporate Plan:

Ÿ         The report on progress at the Third Quarter towards delivering the Corporate Plan 2002/03.

 

 

Staff and financial implications:

Ÿ         The Agency is forecasting a £0.8m net underspend this year, and the money has been offered back to Defra. 

 

 

Main issues to concern the Board:

Ÿ         We expect the Parish Transport Grant to underspend by around £3.8m as a stand alone budget.   Defra has now lifted the ring-fence on Transport spend and we are absorbing the bulk of this underspend elsewhere, but have offered £0.8m back to Defra. Is the Board satisfied that the Agency is learning the lessons from this area of underperformance, addressing them in its future plans, and communicating them to Defra?

Ÿ         The implementation of the CRoW Act continues to be the Agency’s greatest area of risk, as discussed by the Board in its Risk Seminar in November.   Is the Board confident that the Agency is successfully negotiating sufficient support from Defra in this work, and has robust management in place?

 

 


Background

 

1.   The Countryside Agency is broadly on track to achieve its planned outcomes this year.    The Summary reports for each programme are attached at Annex A, and highlights of the Agency’s performance and areas for concern are described below. 

 

2.   The major departure from the Plan has been the underperformance of the Parish Transport Grant within Vital Villages;   we are forecasting a underspend of £3.8m on this grant, within an overall budget of [£4.2m]. Transport budgets have traditionally been ring-fenced.   This is legacy of earlier funding arrangements when predecessor bodies received funding from two different departments. The ring-fence has now been lifted following a successful case by the Agency.   This has enabled the bulk of the underspend to be used elsewhere, and the Agency has offered £0.8m of the underspend back to the Defra.   After accounting for the offered up underspend on transport, the Agency is forecasting that it will deliver spend within the resource ceilings set by Defra in their Grant in Aid letter of June 2002.

 

Headline achievements

 

3.  Finest Countryside

The South Downs National Park (Designation) Order 2002 was signed by the Chairman and Chief Executive on 18 December 2002, and is on deposit between 27 January - 28 February 2003.

 

4.  Enjoying the Countryside

The Discovering Lost Ways project has started in earnest following the Board decision in December.   Expressions of interest in carrying out the work are being invited via the European Journal; the national advisory group has met and is being very supportive.   The Agency has been able to reassure national groups that there will be a significant role for volunteers (also a concern highlighted by the Board in December).

 

5.  Wider Welcome

Ÿ The provisional map for the South East was issued on 7 October 2002.   This has resulted in approximately 160 appeals, which is marginally below our estimates.   This is encouraging because it suggests that the bureaucratic costs of mapping will be contained at reasonable levels;

Ÿ The provisional map for Lower North West issued on 18 November 2002;

Ÿ The draft map for Upper North West issued on 10 December 2002;

Ÿ The draft map for Central Southern England draft issued on 3 September 2002.

 

6.  Vital Villages

Interest in the Rural Transport Partnership grant remains extremely strong in 03/04. Partnerships now cover all rural counties (91 to date) and partnership officers are continuing to develop community based projects that tackle social exclusion and increase visitors' access to the countryside. For the second year running we expect spending to exceed our Rural Transport Partnership budget (£10.8M), the result of many years hard work since transport grants were first introduced. Our Rural White Paper target of 500 projects by March 2004 will certainly be exceeded; we will have supported over 400 projects by the end of this year. The new learning network for partnership officers has been effective in sharing best practice across the country and the result is such high numbers of projects coming forward for funding next year that we could potentially overspend.

 

7.  Rural Services

The Agency held a major national conference on social exclusion on 3 December, bringing together results form the Agency’s work on this issue over the last three years and sharing lessons and experience.   The conference was addressed by the Ministers for Social Exclusion and Rural Affairs.  

 

Headline areas for concern

 

Finest Countryside

8.   The New Forest Public Inquiry will continuing into April, and will have cost the Agency at least £1.2m, excluding staff costs by the time it concludes.   The Inquiry began in October, and the Agency expected it to conclude in January.   However, Defra extended the scope of the Public Inquiry from considering the designation order, i.e. the boundary, to include the principle of the National Park and its administration. This delay means that the National Park is unlikely to be designated next financial year, as planned, but in 2005/06.   It has also added to our costs.

 

Enjoying the Countryside

9.   Conservation Board status for Chilterns and Cotswolds AONBs will not be achieved at the end of this financial year as planned, as the legal arrangements are taking longer than anticipated due to a heavy work load in the Defra legal team.

 

Wider Welcome

10.   Our development of procedures and systems to managing local restrictions to access land is delayed.   Specification for an IT system, website and call centre was put out to tender in November 2002, but procurement was stopped as only one bid for the work was submitted. A new procurement process began in January. In addition, the Defra’s publication of restrictions regulations is delayed, and is not expected to be finalised until April.   The system to manage local restrictions needs to be in place by the end of 2003, but this timescale will now be very tight. 

 

Rural Proofing

11.   Two out of four of the Agency’s proposals in its taxation submission to the Treasury appeared in the Chancellor’s pre-Budget report, that is extension of business rate relief for small businesses, and corporation and income tax deductions for habitat management (see July Board paper).  

 

Vital Villages

12.   The Parish Transport Grant will still not achieve the levels of spend in 03/04 that were expected at the start of the scheme. We only expect to spend £1.1m on the Parish Transport Grant this year and a similar amount next year on a further 200 projects, £3.8m less than the original target for the grant scheme. However, in spite of the lower than expected number of grants being taken up, the Parish Transport Grant is reaching the most needy communities with a high proportion of projects in those rural wards within the lowest quintile of access deprivation. It also tends to be the smaller parishes with populations less than 300 that are applying for grants, often in partnership with other parishes - the scheme is definitely encouraging cross parish working. We are undertaking a review of the Parish Transport Grant (within an evaluation of all of our transport support) to see what changes may be needed to meet the needs of parish councils better, and enable them to make more use of the resources on offer to deliver solutions to rural transport issues.

 

Risk

 

13.   The principal risks to the Agency relate to delivery of implementation of the CRoW Act, where delays this year will affect performance in 2003/04 and 2004/05.  

 

Transfer to Resource Accounting and Budgeting

 

14.   In line with the rest of the Government sector, the Agency has recently migrated to a Resource Accounting basis.   This long planned Government initiative replaces the previous arrangement of reporting on a cash accounting basis and brings the public sector into line with accepted financial approaches in the wider commercial world.

 

15.   A material internal training exercise on Resource Accounting and Budgeting (RAB) is currently underway in the Agency.    Resource accounting reports what was achieved and all the resources used in achieving these outputs, irrespective of when the cash was paid.   It combines:

 

Ÿ         accruals accounting - which matches costs to the relevant period, and produces a balance sheet with assets and liabilities (something the Agency has done anyway on an annual basis for its statutory accounts)

 

Ÿ         costs by objectives, showing how much of the costs match against each objective of a department

 

Ÿ         output and performance reporting, showing what has been delivered.

 

16.   As is the case in Defra, the migration to RAB is likely to raise a few issues of rebalancing during the final quarter of this financial year.    Managers and staff are also on a 'learning curve' - for example, there will be more emphasis on generating accurate accruals in year at the micro level and project managers are being coached in this area.     Not all managers are familiar with all aspects of the new accounting regime so we will need to pay careful attention to interpreting their reported results over the next two or three months.   We are nevertheless confident that a full and successful migration will be achieved by 1 April 2003 and that we will enter the new financial year on a sound footing.