Meeting documents

1.1 This report provides information about progress made on the Council's Public Service Agreement (PSA) which was agreed with the Government in August 03. The PSA includes 12 "stretch" targets which, if achieved by March 2006, trigger performance reward grants to the Council. The government also provides upfront funds to assist achievement.

1.2 The details of each stretch target and the funds applied are contained in the performance report attached as an Appendix.

2.1 That the Executive notes the progress reported in Appendix A.

2.2 That the Executive considers whether the distribution of 30% of any Performance Reward Grant should be payable to those services achieving the stretch target, in 2006/07, thus providing an incentive for achievement.

3.1 The agreed PSA funding is as follows:

Note: services and other agencies have also agreed to contribute a further £1m to achieve these targets.

3.2 Pump priming money is being used to enable services to meet stretch performance targets and will be used over the 3 year PSA period as a contribution towards the extra costs involved.

3.3 Unsupported Credit Approvals (UCA) have been included in our approved capital programme.

3.4 Details of the pump priming and UCA funds allocated to each individual PSA target are set out in the performance report attached.

3.5 If services achieve 100% of all the stretch targets the Council will receive an extra £3.5m in total Performance Reward Grants (PRG) after 2006. This is calculated as equivalent to 2.5% of the Council's 2002/03 net budget requirement (£143m). The total grant is divided equally amongst the 12 targets. If less than 60% of any stretch target is achieved then there will not be any PRG award for that target.

4.1 The PSA is a contract between the Council and the Government to "stretch" performance beyond that which would be expected from "normal" improvement activities.

4.2 In order to facilitate this, the Government has agreed to provide additional funds that will allow services to develop beyond budget constraints. These funds are in the form of Pump Priming and Unsupported Credit Approvals, as set out above, under section 3 of the report. Appendix B shows the funding for each target.

4.3 This is the first progress report on the PSA targets. The Appendix shows the interim targets we have set for 2003/04, current progress and matters arising. Further performance progress reports will be presented to the Executive on a 4 monthly basis. As well as being reviewed by the Executive, this performance report is on the agenda of the Corporate Issues and Partnerships Overview and Scrutiny Panel for February 12^th 2004.

4.4 This agreement is part of the Government's first wave of PSA agreements. It is anticipated that the Government will conduct a second wave of PSA. The Council could apply for a second PSA agreement, for which negotiations with Government would begin in approximately February 05, by which time we will have sufficient experience to monitor our progress.

5.1 We recommend that a proportion of the reward grant earned in 2006/07 should be distributed to the service area achieving the stretch target. Broadcasting this reward at this early stage would act as an incentive to the services to achieve that stretch target.

5.2 Therefore we propose that the Executive considers whether 30% of the reward grant for each target is payable in 2006/07 to each service achieving their target. The remaining 70% could be distributed according to Council priorities at that time (in 2006/07).

5.3 The alternative to awarding a portion of the reward grant to the service achieving the stretch would be for the Executive to allocate the total amount of the grant according to the priorities at the time (2006/07). However, this proposal would reduce the incentive for services to succeed.

6.1 Copies of this report have been issued to Trades Unions; any comments received will be reported to the meeting

6.2 Consultation regarding the project plans for each PSA agreement has been wide and various during the PSA agreement negotiations, and has been reported as follows:

(1) Reports to the Council Executive in February, June, September and November 2002

(2) Reports to the Corporate Issues and Partnership Overview & Scrutiny Panel in September 2002, May and September 2003.

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