Markets Financial Summary Information

Markets Financial Summary Information

Introduction

This information relates to the costs that the Council incurs in providing its markets across the Borough, and the income it receives from market stall rents.

The summary shows the situation for the current financial year, which runs to 1 April 2008. Therefore, figures include an element of projected outturn, in other words, the final quarter of the year is estimated based upon a combination of the previous three quarters’ figures, and where relevant, a comparison with the same period in previous years. It cannot, therefore, be 100% accurate but is compiled in accordance with Government guidelines and meets the criteria for public sector accounting.

Breakdown

The summary is broken down into sub headings, which relate to the different types of expenditure. A short explanation of the type of transaction to be found within each heading is included to help the reader understand what it relates to. The figures have not been broken down into geographical areas of Stockton, Billingham and Thornaby, as most of the costs are charged centrally and it would be nearly impossible to obtain anything approaching an accurate figure when trying to allocate these to each individual market.

For that reason, the income is shown as one figure also. The projected outturn for income to the end of the current financial year is shown for each market but this does not include any charges:

Stockton £ 250,000

Billingham £ 33,000

Thornaby £18,500

Corporate Allocations – Other Areas of Expenditure

The costs shown are only those, which are billed direct to the market service. However, an income target is set by the Council as to how much the market is expected to earn, and this includes a contribution to the overall supplies and services provided by the Council from which the market benefits, but which are not directly attributable to the market alone (ie. The benefits are shared and therefore so is the cost).

In addition, there is Council expenditure that relate directly to markets for which the cost has not been passed on. This is primarily the provision of new stall covers, for which the overall project costs including trials, samples and publicity is in the region of £100,000 to date.

Proposed Increase in Stall Rents

Having reviewed the figures, the Head of Regeneration is keen to implement an increase of not less than £3 per stall pitch from April 2008 in order that the market can clear its deficit against target and generate a surplus for ongoing reinvestment.

Summary by Type of Expenditure

2007/8

Item / Value £ / Detail
Employees / 120,336 / inc Staff costs, insurance,transport, training
Premises / 67,675 / Rates for use of High Street & other centres, insurance
Supplies and Services / 90,641 / inc Street Cleansing, advertising, telephone, cash security etc.
Income Actual / (301,500) / All markets, all areas
TOTAL / (22,848) / Income less Expenditure
Income Target 2007/8 / (340,500) / Set by Council
Shortfall against target / 16,152

2008/9

Item / Value* £ with no change in income / £3 increase* / £5 increase*
Employees / 134,726
Premises / 77,785
Supplies and Services / 83,325
Income Predicted / (301,500) / (349,211) / (382,470)
TOTAL / (5,664) / (53,375) / (86,634)
Income Target 2008/9 / (340,500) / (340,500) / (340,500)
Shortfall against target / 33,336

*projected only

Corporate Allocations – Other Areas of Expenditure – Shared Benefits

• Street Lighting

• Highways Repairs

• Surveillance

• Trading Standards and Licensing

• Environmental Health

• Events

• Communications/Press Releases

• Traffic Management

Corporate Allocations – Other Areas of Expenditure – Direct Benefits

• Markets redevelopment
• Markets launch and associated marketing

Proposed Increase from 1 April 2008

If there were no change to stall rents, the market would continue to lose money year on year at an increasing rate as other costs go up. An increase of £3 per market stall is calculated to generate additional income of approximately £55,000, based upon this year’s actual occupancy rates, which will offset our under-recovery against our budgeted income target, in other words, allowing us to pay our way for the additional Corporate allocations shown above (set by the Council) with a small surplus for contingency and reinvestment in the markets. It should be noted that, whilst there are fluctuations in the numbers of traders standing each week, with considerable vacancies at certain times such as January and February, the markets service is charged costs 100% of the time for 100% of the area.

Concessions

• traders get two weeks free (holiday) per year

• they are not charged if we have made it impossible for them to stand (ie. During SIRF)

• They are not charged if they participate in promotions, such as fancy dress during the Markets Fair

• during the ‘slow’ months of January and February, traders who stand for 3 consecutive weeks get the 4th week free of charge.

Comparison with other markets

Even with a £3 increase, Stockton market rents still compare favourably with other Local Authorities regionally and nationally. Given that Stockton achieves exceptionally high footfall on Wednesday and Saturdays, it is considered that the proposal is reasonable and appropriate.

The table below shows how Stockton markets compare:

Name / Rent
Catterick / £31 per 12ft frontage
Bolton, Lancs / £25 per 10ft frontage
Darlington / £25 per 10ft frontage prime location; £20 secondary location
Preston, Lancs / £24 per 12ft frontage
Hartlepool / £22.50 per 10ft frontage
Stockton (& Billingham, Monday) / £21.50 per 12ft frontage (after increase)
Billingham (Friday) & Thornaby / £19.50 per 12ft frontage (after increase)

Sue Burgess

Town Centre & Markets Service Manager

December 2007