Minutes of the Finance & Business Operations - 21 March 2023

10/23. Declarations of Interest

None.

11/23. Minutes of Meeting Held 07 February 2023 (Appendix – Agenda Item 3)

Resolved:  That the Minutes of the meeting held on 07 February 2023, be approved as a true and correct record. 

12/23. Matters Arising

None.

13/23. Period 7 Management Accounts and Mid-Year Budget Update (Agenda Item 5)

The Committee considered a verbal report and presentation on the Period 7 Management Accounts in which the EDoF highlighted the key results, measures, and risks.  It was noted that the decision to bring forward the meeting by one week meant that it had been agreed with the Committee Chair that the Period 7 Management Accounts would not be circulated in advance.  The Accounts would now be circulated to all governors.

The key changes and developments since the Period 6 Management Accounts included:

• • • Slightly improved forecast for High Needs local authority funding.
    • National Adult Education Budget (AEB) income tolerance increased from 3% to 10% and improved forecast Trades Union Studies (TUS) Delivery. 
    • Recently announced 2.2% AEB Funding uplifts, with a further 20% uplift on 6 subject areas, not yet included in the forecast.
    • Apprenticeships income had been reduced due to reductions in planned starts and resolution of issues with ensuring all employers had registered with the Digital Apprenticeship Scheme.
    • Improved Education contracts now recognised in the forecast.
    • Pay costs reduced to reflect ongoing below budget expenditure.
    • IT and Premises costs reduced to reflect savings year to date and reclassification of some expenditure as capital rather than revenue.
    • The college’s weekly cashflow forecast had improved by the receipt of its T Level Specialist Equipment Allowance (SEA).

In response to questions:

• • • Regarding Apprenticeships, the P/CEO explained that a minority of businesses had not engaged with the Digital Apprenticeship Service, which released funding which had resulted in the withdrawal of apprentices at the college.  New starts forecast in respect of one employer (JCA) had been significantly downgraded over the last couple of weeks.
    • Regarding cashflow and the receipt of the Specialist Equipment Fund to support T Level delivery from September 2023A, the EDoF explained he was working closely with the Vice Principal, Technical & Vocational Education to plan how the Allocation would be spent. 

The EDoF went on to present on key challenges for 2023-24 and financial risks. 

• • • The initial plan for 2023 – 24, had been impacted by several significant changes over the past six months:
      • Lower than anticipated enrolment of 16-19 learners;
      • The ongoing energy supply issues;
      • The Education & Skills Funding Agency’s (ESFA) changes to the Financial Health scoring system which made achieving a Financial Health score of “good” more challenging.  The college now needed to achieve EBITDA of at least 6% of income to remain “Good”.
    • As part of planning for next year and to identify where the impact of these challenges could be mitigated, the Senior Leadership Team (SLT) had reviewed the current in-year position and developed an updated plan for 2023/24.  The plan identified additional sources of income related to grant funding already secured and known opportunities for growth or new business which were considered to be highly likely to be realised.  In addition, it identifies sources of and targets appropriate cost savings.

In addition, there had been some favourable financial movements.  After discussing the points raised by the EDoF & P/CEO, the Committee concluded that the revised 2023 – 24 Plan offered significant assurance.

14/23. Capital Bid – Verbal Update

The EDoF presented a verbal update on the capital bids being pursued by the college (FBO Min. No. 05/2 refers).

• • • The was no movement in terms of outcomes of bids reported to the previous meeting.
    • The EDoF and P/CEO were working to deliver the Welsh Bridge Campus: Relocation of the Learning Resources Centre from the Quarry Building to Priory Hall and expansion of teaching space in the Quarry Building project ready for September 2023.

15/23. Purchasing Gas & Electricity – College Approach

The Committee reviewed and noted a full report (previously circulated) setting out the college’s approach to the purchase of gas and electricity going forward.

16/23. Update on Industrial Action 

The P/CEO provide a verbal update to the Committee on the impact of the NEU industrial action taken in the college during March 2023.  The college remained open, with minimal impact on students.

17/23. T Level Specialist Equipment Allocation (Appendix, Agenda Item 9)

The Committee noted the contents of the letter sent to the college by the Department of Education confirming its Specialist Equipment Allocation 2023 (previously circulated)

18/23. Additional Item - 2022-23 Insurance Policy Schedule (Appendix circulated at meeting)

As required by Financial Regulations, the Committee reviewed the college’s 2022-23 Insurance Policy Schedule.

The Schedule provided assurance that the college had in place adequate insurance arrangements.  The Committee noted that the college had insurance against protecting against cybercrime, as this was an increasing risk to the sector.  

19/23. Risk (Appendix - Agenda item 10)

The Committee examined those risks within its remit and agreed that they had either been identified and adequately discussed at the meeting.  The 2022– 2023 Strategic Risk Register would be presented to the Board at its next meeting and the Committee noted the additional of a new risk within the remit of the Committee – the planned defunding of AAQs.

20/23. Date of Next Meeting – Tuesday, 16 May 2023 at 5.30 p.m.  Venue - tbc.

The meeting concluded at 7.05 p.m.