Agenda item

          The Board received a report of the Strategic Director, Health and Community which reviewed the income against costs of the Warrington Road Transit Site.

 

          It was reported that in order to consider the effectiveness of the facility and its financial impact in the widest sense, the information be brought to the PPB for scrutiny.       

 

The report detailed the following:

 

• weekly occupancy levels since the site opened in February 2009, which overall had averaged 56% of capacity, however this figure was rising due to increased occupancy in recent weeks;

 

• the draft budget used for estimating purposes when determining the necessary pitch charge. It was noted that the second column was an attempt to forecast the full year budget based on known costs, estimates and income to date. However, the figures must still be considered with some caution due to bills not having been received yet for utility costs. Therefore, true operating costs would not be known until the facility had operated for a year or more.

 

 

Furthermore the Board was advised that estimated pitch fee income had been revised downwards on the basis that 90% occupancy was unlikely to be achieved in the first year.  This was due to reduced traveller migration and word not spreading to the traveller community of the site’s existence. The estimated occupancy rate was now 60%.  This revised budget estimate increased the forecast annual deficit from £619 to £9,479. It was reported that in establishing the true financial impact of the facility on Council budgets, regard should also be taken of the previous cost to the Council of managing unlawful encampments.

 

          Detailed in the report were the combined results from the relevant sections in each directorate which incurred a cost in dealing with unlawful encampments during 2005/6 and 2006/7. This figure totalled £128,856 per year and excluded the substantial Police costs involved.

 

          Inspector Tony Hayes addressed the Committee and reported that since the transit site had been established, there had only been two illegal encampments one of which moved to the transit site and the second group were moved from the Borough when they declined to move to the transit site following a Police direction under Section 62 of the CJPOA Act 1994. It was reported that whilst the transit site was unlikely to achieve a balanced budget this year due to early losses when the site first opened there was, nevertheless, significant saving in costs when compared to expenditure incurred in previous years in relation to illegal encampments.

 

          The Board considered four options for reducing the funding deficit as follows: 

 

1. to raise the pitch charge to a level that covers the shortfall;
2. that a proportion of the site be given over to permanent occupation;
3. to actively publicise the site amongst the wider Traveller community to ensure the site is as full as possible at all times; and
4. to retain current charge levels and further review costs after a full financial year of operation

 

Having considered all the information and options the Board;

 

          RESOLVED: That

 

          having reviewed performance of the Gypsy and Travellers’ Transit Site operating in Runcorn it was found that that since opening, the Site had not been cost efficient in terms of its operating costs (rental revenue vs expenditure) with evidence that operational financial losses have occurred on almost every week the Site has been in operation. The Urban Renewal PPB therefore made the following recommendations to Executive Board Sub.

 

 

          (1) the site should be operated on a stand-alone financial basis namely ensuring that the site annual rental income covers the site’s annual operating expenditure with all opportunities to maximise income being adopted namely; the rental criteria should be levied (with the exception of the Site Manager) against all caravans, mobile homes that occupy the site and not merely some caravans and mobile homes. All other forms of determining who should or should not be charged for a pitch should cease;

 

          (2) caravan pitch charges should be reviewed and increased to ensure that the objective of item 1 above could  be realised. In determining income levels, charges should be set to reflect the need to keep several pitches vacant at any one time in order to not eliminate the legal opportunities the transit site offered the Police to move on illegal encampments;

 

          (3) the site should not be subsidised financially by residents of the Borough either directly or indirectly;

 

          (4) the practice of using cost savings made by reducing the amount of instances HBC would have dealt with unauthorised encampments had the transit site not been in operation to offset the financial operational losses the site made should cease;

 

          (5) the PPB did not accept that raising rental charges on the site would potentially lead to unauthorised encampments. This is based upon legal opinion that Gypsies and Travellers who claimed limited financial means may in fact be able to claim benefits to offset the fee paid for the pitch and there should be a “contingency plan” to accommodate increased demand at certain times by Gypsies and Travellers wishing to use the site and thereby minimising the risk that the Police would be unable to use their extended powers to move illegally camped Gypsies and Travellers.

 

          The Urban Renewal PPB also made the following observations.

 

          The PPB is of the view that supporting information provided to them to review at this meeting was, in part, accurate and that a better management of information and data by Officers in relation to this Site was required in the future to enable Councillors to arrive at a balanced conclusion.

 

          It was noted that, in the past, comment had been expressed by some Councillors at full Council that Officers had been repeatedly asked for information on this Site with the perception being that such requests were in some ways unreasonable. This PPB wishes to point out that the role of Councillors was to scrutinise and the request for information from Officers to enable Councillors to do this was clearly a reasonable one irrespective of the number of times requests need to be made.