Harbours Advisory Committee

4 December 2024

Harbours Budget Monitoring Report 2024/25

For Review and Consultation

Cabinet Member:

Cllr J Andrews, Place Commissioned Services

Local Councillor(s):

All Councillors

Executive Director:

Jan Britton, Executive Lead for Place

Report Author: James Radcliffe (Bridport and Lyme Regis), Ed Carter (Weymouth) Claire Connolly (Weymouth),

Job Title: Harbour Masters, Business Manager

Tel: 01308 423222, 01305 838423

Email:	James.radcliffe@dorsetcouncil.gov.uk, ed.carter@dorsetcouncil.gov.uk

claire.connolly@dorsetcouncil.gov.uk

Report Status: Public Choose an item.

Brief Summary: The purpose of the report is to set out the current budget forecasts and reserve balances for Bridport, Lyme Regis and Weymouth Harbours 2024/25. The financial summaries are given in the appendices.

Recommendation: To note the current budget monitoring figures for 2024/25 as at the end of October:

Note the budget forecast 2024/25 for Bridport Harbour

Note the budget forecast 2024/25 for Lyme Regis Harbour

Note the budget forecast 2024/25 for Weymouth Harbour

Reason for Recommendation; The Dorset Council Harbour Strategy, Strategic Goal number four is to have a balanced budget whilst building the ability for investment into the harbours. It is intended for harbours to become financially self-sufficient and be able to manage any reserves to ensure that the harbours see reinvestment to support strategic goals and objectives from the Business Plan.

The Harbours’ budget monitoring and regular reporting to the Harbours Advisory Committee helps manage the risks of under or overspending the budget and review income against financial expectations.

Bridport Harbour 2024/25 Budget:

The Bridport Harbour budget forecast figures are given at Appendix 1.

Expenditure overall: £20,931 favourable

The main variances to the budget predictions are as follows:

Expected saving on salaries due mainly to the vacant mechanic post (this affects income as highlighted further below). Partly offset by ‘over budget’ seasonal hours.

Minor overspend on Business Rates due to an uplift in charges in current year.

Minor overspend on Transport costs due to increased R&M charges – especially £3k spend this month on ‘Boat Lifter Lift Rams’.

Net saving on Supplies & Services codes due to a significant saving on the dredging budget, where the next dredge is not anticipated until April 2025 (and hence the 25/26 financial year) and the previous dredge straddling March / April 2024. However, this is offset by an anticipated overspend on Equipment costs. This Equipment overspend was previously highlighted as likely to be funded from reserve. However, it is now forecast to come from the revenue budget, which will reduce the final surplus transfer to reserve. £10k overspend forecasted on Contractor costs.

Income - £49,044 adverse

Major shortfall expected on ‘Re-imbursement & Contributions’ due to unachievable income budget for Boat Repairs – linked into the salary savings above.

Shortfall on general income due to a significant bad debt write off in year, and Car Parking income being generally down on last year’s income on current year to date profiles. Boating / Mooring related income is forecast to be on budget.

Reserve Movements

The original budgeted surplus for Bridport was £91,895, however the forecast is for a net surplus of £63,782. So, whilst this is still a healthy position where the reserve is forecast to be topped up at year end, the forecast surplus is lower than originally budgeted (by £28,113) due to the factors highlighted above.

Predicted year-end reserve balance £190,903

Lyme Regis Harbour 2024/25 Budget:

2.1	The Lyme Regis budget forecast figures are given at appendix 2.

2.2	Expenditure £76,225 Favourable

2.3	The main variances to the budget predictions are as follows:

Internal Charges will come in around on budget. The current ‘overspend’ relating to a recharge from Highways will be covered by a virement from the Dredging budget.

The salary budget will come in with an overspend due to increased seasonal hours over the Summer / Autumn period. Once the pay award and associated backpay has been processed, should have a clearer indication as to the level of overspend.

Overspend on Business Rates due to the Council taking back a couple of Rates liabilities relating to Fisherman’s and Traders association

Minor saving expected on the Lyme Regis vehicle fuel budget

Significant saving expected on the Dredging budget as per Bridport – next Dredge is anticipated in April and hence will be a 2025/26 cost. Saving partly offset by loss of Grant income (highlighted below) and increased Equipment and Merchant Banking charges.

Minor overspend expected on the Contractors budget

2.4	Income - £47,219 Adverse

Shortfall of EA grant income of £66k due to the Dredging. This will offset with the wider saving on the dredging budget.

Income from Memorials expected to be very near to budget.

Net surplus on Income / Fees & Charges budgets due mainly to buoyant car parking income.

2.5	Reserve Movements

Lyme Regis Harbour still operates as a net cost and is funded by Dorset Council General Fund. The current net budget is £32,927. The anticipated outturn is for a net cost of £3,921, and as such a reported underspend of £29,006. This underspend will be returned to the Corporate Centre.

Weymouth Harbour 2024/25 Budget: Overall £85,613 favourable

Dorset Councils Harbours Strategy and Business Plan, gives a 5-year financial and investment plan and will guide the future use of budgets. This has helped re-focus the priorities for the future.

The harbour reserves have been built up to enable the harbour to be financially self-sufficient. Weymouth harbour has been successful in continuing to achieve a balanced budget whilst building the ability to invest in the harbour (Strategic Goal 4).

The Weymouth harbour budget was approved with an expectation that there would be a surplus of £838,556 to be transferred in the reserve at year end. The financial picture for Weymouth remains healthy, forecast figures are given at appendix 3.

Income: £99,316 favourable

Variances relating to income are as follows:

An approved early release from a lease has resulted in reduced income whilst the site is being reviewed for future use.

During the pandemic, income from visitors using the slipway for daily launching and the purchasing water sports permits more than doubled. This continued for 4 years. Activity at the slipway has reduced this season and income in these areas is more comparable to pre-covid times.

Whilst occupancy in the marina does remain high, it is lower than the previous two years. Our expectation is that budgeted figures will not be achieved but it is an improving picture from the budget monitoring report in September.

There is increased income from visiting commercial vessels. This is due to a change in procedures which has resulted in capturing more out of hours visitors.

The number of visiting recreational visits has fluctuated month by month, July was particularly busy. Overall, income for overnight stays and associated income such as electricity and laundry will exceed budgets targets.

Winter berthing in the outer harbour has remained popular and there has been increased revenue in this area.

Increased revenue in relations to a rent review and the backdated rent dated from 2023 being invoiced in this financial year.

Parking income is slightly down on the forecast at the last meeting. Summer income is generally down across Dorset Council car parks, parking income compared to last year, especially for September. This is attributed to poor weather.

Expenditure: £13,703 adverse

Variances relating to expenditure are as follows:

Utility companies have taken meter readings which has resulted in multiple credit notes and reinvoicing. These have crossed over two financial years. This does mean that costs are likely to be lower than budgeted, but the amount of energy used remains the same.

Initial projection to make savings on seasonal staff have not been achieved as long-term sickness that requires back-filling has increased costs

Costs relating to harbour owned car parks are higher than budget due to an increase in business rates. This is because there are more parking spaces as an outcome of the Weymouth Quay Regeneration Project.

Targets will continue to be closely monitored through the year to ensure accurate and timely reporting and if required action can be taken to mitigate any shortfalls.

Weymouth Harbour Reserves:

The reserve balance carried forward is £3,595,310.

£400,000 is committed to fund works associated with the Weymouth Quay Regeneration Project.

The overall favourable prediction of £85,613 will also be transferred into the reserves, leaving a predicted reserve balance of £3,444,379.

This balance is committed to carrying out a programme of works needed for maintaining and improving facilities to protect income streams and deliver on the priorities set out Dorset Harbours Strategy and Business Plan. Due to previous financial pressures, there is a back log of under investment that needs addressing.

From 2024, the harbour reserves have been split it into separate categories. This will give better financial clarity and show where and how the reserves are committed and to better identify funds for future projects and investments. The separate reserves are as follows:

Existing asset management fund

Development and project fund

Maintenance dredging fund

Pleasure Pier fund

Emergency Contingency fund

Details of how the reserve is split is shown on appendix 3 of this report.

Funding in these new reserves is not necessarily ringfenced. As spending fluctuates, surplus can be transferred between reserves if required.

The table below provides details of the replacement and maintenance plans for existing harbour assets over the next five years. This is under constant review both in the short and long term to review how assets are being used, to maximise the life of items and to review the priorities.

Existing Assets – Management Plan
Category	2024	2025	2026	2027	2028
Harbour Infrastructure	£222k	£110k	£74.5k	£37k	£24k
Moorings Infrastructure	£10k	£215k	£265k	£7.5k	£0
Operational / navigation	£37.5k	£14.5k	£32.5k	£47k	£10k
Total annual spend	£269.5k	£339.5k	£372k	£91.5k	£34k

Over the next five years, significant investment in the harbour is planned, with a full programme of inner harbour marina replacement and improvement works out lined in further detail in the Business Plan.

The table below details the proposed development and projects. Where projects have not been fully costed, an estimated figure has been used and this plan will be updated as projects take shape, and costings are finalised.

Development and Project Plan
Category	2024	2025	2026	2027	2028
Building D development	£60k
Commercial Area enhancements	£150k
Commercial Area slipway and scrubbing area design	£5k
The Cove – Navigational Risk Assessment and project design	£10k
Pleasure Pier, gate, fencing and improvements	£30k
The Cove – installation	£500k
Installation of extra pontoons on Custom House Quay	£140k
Inner harbour marina design	£10k
Commercial Area slipway and scrubbing area install	£500k
Inner harbour marina installation	£500k	£500k	£500k

Once the initial costs of the improvements have been met, payments will continue to be made into replacement funds, to cover future costs.

Financial Implications

4.1	The financial picture for all three harbours is an improving picture, there are however some budget risks. Poor weather and an early Easter have impacted income figures. Occupancy rates on marina berths are lower than the same period last year.

2024 will see the completion of Weymouth Quayside Regeneration Project. This will impact on the budget for Weymouth as we work to deliver the new service provisions and complete the finishing touches of the project.

The report covers the harbours’ budgets. The summary information is presented under the standard corporate headings.

The types of expenditure included within each heading are as follows:

Internal charges – this includes the “above the line” service recharges paid to Dorset Council.

Pay related costs- costs relating to staffing including basic pay, national insurance, pension contributions and training.

Premises related costs– utilities and rates, refuse, planned maintenance, surveys, response maintenance.

Transport related costs – fuel, travel and subsistence.

Supplies and services – Insurance, advertising, equipment, subscriptions, printing and stationery.

The income is made up of:

Commercial activities – income relating to annual commercial berths, visiting commercial vessels and visiting fishing vessels.

Leisure activities – marina berths, visiting yachts, use of slipway and PWC permits (PWC permits relate to Weymouth only).

Rents and licences – income relating to rental of property, vessel and operating licences.

Recoverable costs – where recharges are made to lease and licence holders for energy. Also includes electricity charged to annual berth holders and visiting vessels.

Natural Environment, Climate & Ecology Implications

The Harbours’ Budget funds items that have implications for sustainability and climate change. In utilising future budgets every effort will be made where possible to consider how carbon output can be minimised and operations made more sustainable. Below is the Decision wheel which shows the impacts of this proposal on the aims of our Natural Environment, Climate & Ecology Strategy.

Well-being and Health Implications

The Harbours’ Budgets fund items that have implications for voluntary organisations, community safety and physical activity. It is recognised that looking after the Harbour infrastructure is vital for the safe and efficient use of the Harbour for these purposes. The implications are considered for individual items when funding commitment is being approved.

Other Implications

Harbour issues are subject to regular consultation with customers, the Harbour Consultative Groups and the Harbours Advisory Committee.

The harbours’ accounts form part of the Council’s overall Statement of Accounts, which is considered and approved by the Audit Committee.

Risk Assessment

HAVING CONSIDERED: the risks associated with this decision; the level of risk has been identified as:

Current Risk: Low

Residual Risk: Low

The Harbours’ budget monitoring and regular reporting to the Harbours Advisory Committee helps manage the risks of under or overspending the budget. Many items of expenditure have a link to safety of customers and the public.

Equalities Impact Assessment

There are no equalities implications arising from this report.

Appendices

Appendix 1 Bridport Harbour Financial Summary

Appendix 2 Lyme Regis Harbour Financial Summary

Appendix 3 Weymouth Harbour Financial Summary

Background Papers

None

Report Sign Off

11.1	This report has been through the internal report clearance process and has been signed off by the Director for Legal and Democratic (Monitoring Officer), the Executive Director for Corporate Development (Section 151 Officer) and the appropriate Cabinet Member(s)