Agenda and minutes

Apologies were received from County Councillor L Parkinson and Councillor G Baker. County Councillor A Riggott was in attendance as substitute.

Members are asked to consider any pecuniary and non-pecuniary interests they may have to disclose to the meeting in relation to matters under consideration on the agenda.

County Councillor A Riggott declared a non-pecuniary interest in item 10 pertaining to his role as both County and Borough Councillor as the proposed development was within his division.

Resolved: That the Minutes of the last meeting held on 26 March 2025 be confirmed as a correct record and signed by the Chair.

The Director of Corporate Services advised that this report set out the Authority’s borrowing and lending activities during 2024/25. All treasury activities undertaken throughout the year were in accordance with the Treasury Management Strategy 2024/25.

Economic Overview

UK inflation had been relatively static throughout 2024/25. Having started the financial year at 2.3% (April), the Consumer Price Index (CPI) measure of inflation briefly dipped to 1.7% in September before ending the financial year at 2.8%. The latest data showed CPI was 3.4% (June 2025) and expectations were that it would average 3.2% over the financial year; this compared to the 2% budgeted figure.

Against that backdrop and the global economy, the Bank Rate reductions had been limited. Bank Rate currently stood at 4.5%, despite the Office for Budget Responsibility reducing its 2025 GDP forecast for the UK economy to only 1% (previously 2% in October). Borrowing was currently expensive although rates were expected to reduce over the coming year or two.

Borrowing Overview

The borrowing levels of the Fire Authority remained unchanged at year end at £2m with no new long-term loans being taken. The existing loans were taken out with the Public Works Loan Board (PWLB) in 2007 when the base rate was 5.75%; with 3 loan amounts, maturity dates and respective interest rates set out in the report. Total interest paid on PWLB borrowing was £90k, which equated to an average interest rate of 4.49%.

The approved capital programme had no requirement to be financed from borrowing until 2026/27 and the debt related to earlier years' capital programmes.  While the borrowing was above its Capital Financing Requirement (CFR), which was the underlying need to borrow for capital purposes, this was because the Fire Authority had a policy of setting aside monies in the form of statutory and voluntary minimum revenue provision (MRP) in order to repay debt as it matures or to make an early repayment.

If the loans were to be repaid early there would be an early repayment (premium) charge. Previous reports on treasury management activities had reported that the premium and the potential loss of investment income had been greater than the savings made on the interest payments therefore it was not considered financially beneficial to repay the loans especially with the potential for increased interest rates. However, at 31 December the Authority would save £10k in interest, split over 10-years, if the loans were to be repaid early. As the Authority was budgeting a borrowing requirement to fund the capital programme from 2026/27, the additional interest on new loans would outweigh the £10k saving achieved from early repayment.

Investments

Both the Chartered Institute of Public Finance and Accountancy (CIPFA) Code and the then Ministry of Housing, Communities and Local Government (MHCLG) Guidance required the Authority to invest its funds prudently, and to have regard to the security and liquidity of its investments before seeking the highest rate of return, or yield. Throughout the year when investing money, the key aim was to strike an appropriate  ...  view the full minutes text for item 4-25/26

The Director of Corporate Services advised that this report presented the financial outturn position for 2024/25, and the impact of this on usable reserves. The revenue outturn position showed an underspend of £0.569m after proposed transfers to earmarked reserves. The Capital outturn expenditure for the year was £4.091m which was also in line with the previous forecast.

Revenue Provisional Outturn

The annual budget for the year was set at £75.155m. The provisional outturn position showed net expenditure of £74.586m, giving a total overspend for the financial year of £0.569m. The total underspend was made up of a (£0.774m) underspend relating to non-pay costs, and a £0.205m overspend relating to pay costs. The detailed provisional revenue outturn was considered by members as set out in appendix A of the report with more significant variances of note shown separately in the table below: -

Future Pressures

Emerging pressures to report to the Resources Committee included inflation forecasts. As reported to the CFA in February, government grants were increased by the September rate of inflation (1.7%) whereas the latest rate of inflation was now 3.5%, which would put pressure on budgets in 2025/26.

The grey book pay award had also been agreed at 3.2% effective from July, this compared to the budgeted assumption of 3%, at the time of writing the green book pay award had not been agreed.

Finally, the Spending Review was announced on 11 June which set out the future departmental spending plans. All fire functions and associated budgets had transferred from the Home Office to the Ministry of Housing, Communities and Local Government (MHCLG) as of 1 April 2025 which meant fire funding was now embedded within MHCLG’s departmental totals which had increased by 1.2% in real terms over the period of the Spending Review. The impact on  ...  view the full minutes text for item 5-25/26

HR Manager Jayne Hutchinson presented the report to members.

The Public Service Pensions Act (PSPA) 2013 introduced the requirement to have a Local Pension Board (LPB) to assist in the governance of the Scheme. The Board had no remit as a decision-making body but was established to assist Lancashire Fire and Rescue Service (LFRS) as the Scheme Manager to fulfil its functions which covered all aspects of governance and administration of the Firefighters’ Pension Scheme (FPS).  The Combined Fire Authority delegated its functions to Bob Warren, then Director of People and Development. Although he had retired from that role, due to the current complexity and pension agenda relating to the Age Discrimination and Part Time Workers remedies which had resulted in the implementation of new pension and HMRC legislation and the development of new policy, he had continued assisting in the pension’s activity for an interim period. 

Work Programme during 2024/25

The focus of pension workload during this year had been reported to the Local Pension Scheme Board and was primarily a continuation of the work on the implementation of the following major projects:

·         The Sargeant/McCloud judgement related to age discrimination, this arose after the implementation of the Firefighters’ Pension Scheme 2015 and followed a successful challenge by the Fire Brigades Union (FBU) of age discrimination in relation to the protections put in place for existing members.

·         Matthews’s judgement affecting on-call members commonly referred to as the ‘Second Options Exercise’. This arose following a legal challenge around on-call firefighters who were eligible to join the pension scheme from the start of employment.

Sargeant/McCloud Age Discrimination Remedy

During the first quarter of 2024/25 Lancashire Fire and Rescue Service (LFRS) completed the pay, tax and contribution data for almost 1,000 members affected by the age discrimination remedy. This allowed the services pension administrator, the Local Pensions Partnership Administration (LPPA) to issue Annual Benefit Statement – Remediable Service Statements (ABS-RSS) to active employees. 50 active employees did not receive ABS-RSS due to a number of reasons principally caused by late or non-receipt of Government guidance. As a result of this it was necessary for the Scheme Manager to report a breach of statutory duties to The Pensions Regulator (TPR).

368 Immediate Choice members (retired before 1 October 2023 with legacy scheme service) were due to receive an Immediate Choice Remediable Service Statement (IC-RSS) before 31 March 2025. 54 individuals did not receive the IC- RSS due to data processing difficulties and late notification of government guidance and the Scheme Manager notified the Pensions Regulator of this breach in statutory procedures as required. The Pension Scheme Manager in accordance with the legislative procedures also notified the Pensions Regulator that due to the necessary government guidance not being issued it was necessary to defer the deadline for the issuing of the IC-RSS for 64 individuals. The reasons for many of the delays was due to the need for the Matthews remedy to be enacted and resolved before the McCloud correction could be progressed. 

Individuals who  ...  view the full minutes text for item 6-25/26

The next scheduled meeting of the Committee has been agreed for 10:00 hours on Wednesday 24 September 2025 in the Main Conference Room, at Lancashire Fire & Rescue Service Headquarters, Fulwood.

Further meetings are:          scheduled for 26 November 2025

                                                proposed for 25 March 2026

The next meeting of the Committee would be held on Wednesday 24 September 2025 at 1000 hours in the Main Conference Room at Lancashire Fire and Rescue Service Headquarters, Fulwood.

Further meeting dates were noted for 26 November 2025 and 25 March 2026.

The Committee is asked to consider whether, under Section 100A(4) of the Local Government Act 1972, they consider that the public should be excluded from the meeting during consideration of the following items of business on the grounds that there would be a likely disclosure of exempt information as defined in the appropriate paragraph of Part 1 of Schedule 12A to the Local Government Act 1972, indicated under the heading to the item.

Resolved: That the press and members of the public be excluded from the meeting during consideration of the following items of business on the grounds that there would be a likely disclosure of exempt information as defined in the appropriate paragraph of Part 1 of Schedule 12A to the Local Government Act 1972, indicated under the heading to the item.

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Members were provided with an update from the Capital Building Projects Working Group.

Resolved: That the report be noted.

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Members considered a report that provided an update on all contracts for one-off purchases valued in excess of £100,000 and high value procurement projects in excess of £100,000 including: new contract awards, progress of ongoing projects and details of new projects.

Resolved:  That the Committee noted and endorsed the report.