Agenda item

Budget and Business Plan 2022/23

For Members to receive an update on the budget and business planning process.

Lead: Martin Tugwell


4.1             Members received the budget and business planning presentation from the Chief Executive and the Finance Director who addressed the key issues within the presentation.  The Chief Executive was keen to stress that this year has been unusual due to receiving the funding letter late and having to understand the implications of it.  He explained that due to this the report has been brought to the Committee at a later stage than usual.


4.2             Cllr Hughes sought clarification on reserve levels and asked if they had been depleted following the payment of one-off costs.


The Finance Director explained that the one-off costs will be drawn from reserves. He further stated that TfN is comfortable with the current and proposed level of reserves over the next three years.


The Chief Executive added that he wants TfN to be in a position where over a three year period the organisation can maintain and remain within the agreed reserve policy allowing for sustainability over the longer term.  The Chief Executive added that, based on a series of planning assumptions, there is anticipated to be a sufficient levels of reserves over the next three years.  This could include factoring in any variances arising from changes to budget assumptions.


4.3             Cllr Salter enquired as to what last year’s budget would have looked like with the responsibilities of the current financial year.


The Finance Director explained that the position last year would broadly have been the same as this year, however last year there was the ability to mitigate some of the costs into the Northern Powerhouse Rail  (NPR) programme and a higher level of reseves. He explained that the budget represents an appropriate costs base to manage the core activities.


Cllr Salter stated that he was satisfied with the approach being taken but was unsure as to the full ramifications of the loss of resources.


Referring to the funding letter, the Chief Executive explained that the letter set out a slight increase in the core funding from the previous year as well as supplying an increase to undertake any functions relating to the co-sponsor role. 


He informed Members that at a recent conference of the seven Sub-national Transport Bodies (STB) the Minister Andrew Stevenson stated that the Ministerial team value the STBs contributions and they are seen as integral to helping the Government with their work.


4.4             Cllr Jones expressed concern with the current situation and questioned the confidence that the Government and Ministers have in TfN.  He stated that the Government’s actions have weakened the organisation and have centralised the decision making process and have cut Transport for the North out.  He suggested that Transport for the North make MPs aware of the strategy that they have for the North and ensure that they have a high profile at the three main political party conferences in the Autumn.


4.5             Cllr Hughes stated that TfN needs to make the case that it is the voice of the North.  He expressed concern at the NPR co-sponsorship role and the fragility of the reserves levels in the organisation.  He further stated that TfN should look for some quick win projects in order to look proactive.


4.6             Cllr Cooper believes that the biggest challenge for TfN will be retaining staff.  He stated that the biggest part of the TfN budget is used on staffing and was concerned as to whether the budget covered any potential inflationary staffing costs and the backdating of these payments once agreed. 


The Finance Director stated that provision has been made for pay awards.


4.7             Cllr Fletcher raised the issue of the Integrated Rail Plan, and the fact that it had been costed on 2019 prices.  He was concerned that there would not be enough money to cover the work needed to be done with no inflation mechanism in place. He highlighted the scrapping of Golborne Link and sought clarity as to whether the North had lost the £3 billion earmarked for that work as a result.  He requested that TfN lobby Government to increase the amount of money there is available to take into account inflation.


4.8             Cllr Fenton asked if TfN is confident that it has the capacity to continue to tap into the requests of Local Transport Authorities.


4.9             The Chair raised the issue of communication and suggested that a standard communication be provided to Members to take back to their local authorities following Transport for the North Board and other TfN meetings.


The Chair then asked if Transport for North had considered in their plans the need for all Combined Authorities to have powers like Transport for London by 2030.


4.10          In response to the Committees questions and comments the Chief Executive explained that there had been a slight increase in the core grant and his priority wasp to retain the technical capability and capacity which he believes is the foundation for arguing for the need for further investment in the North.  He highlighted the current recovery on rail in the North and explained that TfN have been getting the message out loudly that recovery in the North has been stronger than anywhere else.

He reassured the Committee that TfN will be at the party conferences and communications will play an important role.  He highlighted the work TfN does with the All-Party Parliamentary Group and supporting MPs and stated that this work will continue.  


He highlighted the importance of the NPR co-sponsorship role for TfN as it ensures that the North’s views are fed into the process, however as a Statutory Body Transport for the North retains the right to make TfN’s formal position known.  


Addressing the concerns regarding the cancellation of the Golborne Link the Chief Executive stated that he expects there to be a conversation about this at Board on 30 June.  He explained that TfN should be open to looking at alternatives but only if they achieve the desired outcomes.  He explained that work needs to be done together with the Board to highlight what will work in terms of alternatives. 



That the presentation be noted.

A recess was taken and the meeting recommenced at 12.20.

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