CORPORATION OF BROOKSBY MELTON COLLEGE: BOARD OF GOVERNORS FINANCE AND GENERAL PURPOSES COMMITTEE

Transcription

1 CORPORATION OF BROOKSBY MELTON COLLEGE: BOARD OF GOVERNORS FINANCE AND GENERAL PURPOSES COMMITTEE Minutes of the meeting held in the Beatty Room at the Brooksby Campus on Wednesday, 24 th June 2015 at 9.30a.m. COMMITTEE MEMBERS PRESENT: ALSO IN ATTENDANCE: Chris Ball, Principal David Irving Trevor Jones Ron Marks Andrew Wolfe, Lisa Craddock, Director OD & BS Stella Dickie, Director of Finance Lesley Coates, Clerk to the Governors Min. 59. CHAIR S COMMUNICATIONS The welcomed everyone to the meeting. 60. APOLOGIES There were no apologies for absence. The meeting was confirmed to be quorate with 5 members of the Committee present. Clerk 24 June 61. DECLARATION OF INTERESTS IN ANY OF THE ITEMS ON THE AGENDA The reminded those present to declare at the start of the meeting interests held in any matter to be discussed. No interests other than those stated on the agenda were declared. RECURRENT ITEMS OF BUSINESS 62. MINUTES OF THE MEETING HELD ON 11 MARCH 2015 that the Minutes of the meeting held on 11 March 2015 be confirmed as a correct record and signed by the. 24 June 63. PROGRESS REPORT The progress report on matters carried forward from the last meeting was RECEIVED and NOTED. Page 1 of 7

2 64. PRINCIPAL S REPORT The Principal presented an update on College financial issues and confirmed that the management team continued to tightly manage income, expenditure and cashflow. The report gave an assessment of variances which could impact on final year out-turn and how the College was mitigating against these. The Committee was recommended to accept that to protect quality it had been necessary for the College Management Team to incur costs in excess of budget of approximately 60k, but this additional cost would be managed to ensure that it did not jeopardise the underlying strength of the organisation. The costs had been due to agency fees to cover long term staff sickness absence, and the impact of the new facilities. The Committee supported the over-spend of 60k which was confirmed would not affect the financial health of the College. (The amount which would affect the financial health of the College was currently calculated as 450k). Members requested that a one page or verbal report be prepared for the Board to give reassurance on the overspend, and gave details of delivered income and mitigating actions taken to maintain income. Members noted the 1.1m three year unfunded over-delivery for students and appreciated the strategic direction taken by the College to increase student numbers and absorb costs, and the commitment of the College to support local learner needs The development and growth of the sports academies which could be the 2 nd largest area in the College within two years was noted. The challenge of ensuring the academic engagement of sports students was discussed, and techniques used to overcome this were explained. The update on estates developments and the disposal of surplus assets including the sale of Spinney Cottages and the Grange Barn was noted. Dir Fin that the report be noted. 65. FINANCE REPORT/ MANAGEMENT ACCOUNTS (MAY 2015) The Finance Report for the 10 month period up to 31 st May 2015 had been circulated to all members by , and copies were tabled at the meeting. Many of the issues had been discussed as part of the Principal s report (minute no 66 refers). The impact of the negative variance of full cost courses was noted and confirmation was given that this had been impacted upon by the delay of Local Authorities in signing for this provision due to their own Page 2 of 7

3 budget restrictions. The negative variance for Brooksby Hall income was explained to be due to necessary compromises to maintain curriculum activities. The Committee appreciated the need to strategically develop and market the commercial aspects of the College, whilst maintaining curriculum provision. that the Finance report be noted OTHER ITEMS OF BUSINESS 66. HR PROGRESS REPORT The Director of Organisational Development and Business Skills (OD&BS) presented an update on the HR Action Plan. The meeting noted the difficulties in recruiting new members of staff, particularly to posts on minimum wage. The rural location of the Brooksby campus made recruitment particularly difficult, together with the high levels of employment within the Melton area. Other challenges had included the quality of the candidates applying for positions, with some posts being advertised several times before being filled. Members noted the continued embedment of the Staff Appraisal and Competency Analysis Procedure. Suggestion was made that a headline summary be provided which highlighted the trends and key challenges within HR. that the update be noted. 67. POLICIES FOR REVIEW a. Subcontracting Supply Chain Fees and Charges Policy b. Staff Appraisal Competency Analysis that: a. The Subcontracting Supply Chain Fees and Charges Policy be recommended to the Board of Governors for approval; and b. The updated Staff Appraisal Competency Analysis be recommended to the Board of Governors for approval. Page 3 of 7

4 68. BUDGET FOR FORTHCOMING YEAR (INCLUDING PAY AWARD IF APPLICABLE) AND UPD FINANCIAL FORECAST Members gave consideration to the Budget for and the 5 year financial plan to 2020 which had been set to take into consideration the increasing pressure due to reducing funding in many areas. The estate, revenue and cost assumptions were noted. The proposed budget recommended a deficit of 295k for the year, which was to be mitigated against by the sale of surplus assets. Members noted the proximity of the proposed deficit to the cut-off level of 450k at which the financial health of the College would be affected. The Committee gave consideration to the various sections of the income and expenditure accounts. Items discussed in detail included the difficulty in offering a pay-rise to staff and the balance of protecting jobs and the sums included for operating expenses. The Director of Finance gave confirmation that a meeting had been arranged with the College s Financial Statements Auditors to agree the accounting methods to be used for the sale of College assets for tax purposes. Members discussed the benefits of having a revaluation of College assets, but confirmation was given that if commenced there was now a requirement for a revaluation to be carried out annually. To give assurance that the College could mitigate against the likelihood of breaching the bank covenant in 2016/17, confirmation was given that the 5 year plan would be revisited to reflect other income potential from commercial activities, quarry operations and disposal of assets linked to the 5 year estate strategy implementation. The Director of Finance confirmed a short paper/ sensitivity analysis outlining the potential growth of income from commercial activities and how this is likely to support the budget in the forthcoming 5 years would be produced to be read in conjunction with the budget. The Director of Finance was congratulated on preparing a workable budget within the limitations of reducing funding. that, subject to the production of a brief report/ sensitivity analysis around commercial income to be read alongside the main document, the proposed budget for 2015/16 be recommended to the Board of Governors for Approval The Director of OD&BS left the meeting. Dir Fin Page 4 of 7

5 69. PRESENTATION ON 4-5 YEAR ESTATE DEVELOPMENT OF THE COLLEGE The Committee was presented with a 5 year strategy for the estates development of the College following completion of the SFA CCIF capital projects. The report focused on the continued development of the College upon two sites. Details of the remaining projects to be completed from the 2012 masterplan were noted. The estate rationalisation to date was confirmed, and details of further potential asset disposals were outlined. that the 2020 Estates Strategy 5 year plan be recommended to the Board of Governors for approval as part of the 5 Year College Strategy Oct SFA - FINANCIAL RECORD ASSESSMENT 2013/14 The Committee noted the letter received from the Skills Funding Agency which confirmed that following a review of the College s audited financial statements and finance record, the Underlying Financial Health of the College had been graded as Satisfactory. 71. REVIEW OF FINANCIAL REGULATIONS The Committee reviewed the Financial Regulations which had been updated by the Director of Finance and members noted the proposed changes to reflect current operations and legislation. that the updated Financial Regulations be recommended to the Board of Governors for approval. 72. INSURANCE & INSURED RISKS ANNUAL REVIEW The Director of Finance tabled the College Insurance proposals and insured risks for the forthcoming year. The 5 year agreement with NFU was now ending, and the College was now able to go out to tender for insurance, via Arthur J. Galagher the College s current insurance brokers. that: a. the Board of Governors be recommended to grant the College authorisation to go to market for insurance cover for the College as detailed in the report; and b. the College accept the best premium offered for the insurance Page 5 of 7

6 73. REVIEW OF COMMITTEE OBJECTIVES FOR 2014/15 AND SETTING OF OBJECTIVES FOR 2015/16 The Committee reviewed its objectives for 2014/15 and agreed that: Objective 1 to achieve a break-even of income and expenditure and to monitor payroll costs as a percentage of income a break even of income had not been achieved but the Committee had continued to monitor payroll costs as a percentage of income. Objectives 2, 3, 4 & 5 had been achieved. Objectives 7 To work with College Management to develop a financial strategy which allows the College to offer pay awards in line with AoC recommendations had not been achieved to date. Objective 8 To work with College management to develop a long term financial and estates strategy that will enable the achievement of financial surpluses to maintain, enhance and develop the College and it s estate remained work in progress. The objectives for the forthcoming year would be agreed at the first meeting of the Committee in September. Clerk Sept REVIEW OF COMMITTEE TERMS OF REFERENCE The Committee gave consideration to its Terms of Reference and were in agreement that no amendments were required. that the unrevised Terms of Reference for the Committee be recommended to the Board of Governors for approval. Oct ANY OTHER ITEMS OF BUSINESS a) Request to write off debtors in excess of 1000 Members were reminded that within the Financial Regulations agreement must be obtained from the Board to enable the College to write off any unrecoverable debt in excess of Details of three unrecoverable debts were presented to the Committee, and the actions taken to recover the debts were explained. Confirmation was given that all the debts had been provided for within the 2014/15 accounts. that the Board of Governors be recommended to write off the three debts as detailed. Page 6 of 7

7 b) Principal s Report additional information. The Principal requested that Governors approve the granting of three additional discretionary days holiday on 21, 22 and 23 December 2015 in lieu of a pay award and to enable the College to make savings on premises costs. that the Board of Governors be recommended to approve the granting of three additional discretionary days holiday on 21, 22 and 23 December There were no other items of business. 76. EVALUATION OF MEETING - WHAT HAS BEEN THE IMPACT OF THE MEETING TODAY UPON LEARNERS? The Committee agreed that the Learner had been at the heart of all the decisions made within the meeting, and was evidenced by members supporting a deficit budget. CONFIDENTIAL ITEMS There are no separate records of these Confidential Minutes. 77. CONFIDENTIAL MINUTES OF THE MEETING HELD ON 11 MARCH 2015 that the Confidential Minutes of the meeting held on 11 March 2015 be confirmed as a correct record and signed by the. 24 June 78. PROGRESS REPORT CONFIDENTIAL ITEMS The progress report on confidential matters carried forward from the last meeting was RECEIVED and NOTED. The Principal updated the Committee on the progress of discussions with the Town Estate and gave confirmation that negotiations were progressing. 79. ANY OTHER ITEMS OF CONFIDENTIAL BUSINESS There were no further items of confidential business. There being no further business, the thanked everyone for their attendance and participation and closed the meeting. The meeting ended at 12.07pm L. K. COATES Clerk to the Governors Signed as a correct record on 28 September Page 7 of 7