Police and Crime Commissioners (PCCs) with debt are required to set aside some of their revenue each year as provision for debt.
More precisely, this provision is in respect of capital expenditure financed by borrowing or credit arrangements.
In February 2014, the PCC approved the MRP Strategy (Decision 14 – 2014) to be used during 2014-15 and this has been followed.
Within MRP regulations, the new regulation 28 replaces detailed rules with a simple duty for an authority to allocate an amount of MRP each year, which it considers to be “prudent”.
This provides a great deal of discretion, and therefore options, to a PCC in the way in which a prudent MRP strategy is delivered.
Given the current financial position and the expected continuation of funding reductions in future years, there is an option for the PCC to make a Voluntary MRP contribution in 2014-15.
This will reduce the amount that the PCC needs to set aside in future years. The table below shows the potential impact:
|Current MRP Charges||1,097||1,102||1,107||1,111||1,115||1,271||1,208||1,183||963||702||10,859|
|Proposed MRP Charges||1,097||1,102||788||793||797||801||775||750||725||702||8,331|
|Voluntary MRP Charge||2,528||2,528|
|Variance to Current plan||2,528||0||-318||-318||-318||-470||-433||-433||-238||0||0|
The underspend during 2014-15 combined with the current level of General and Earmarked Reserves provides the PCC with an option to make a voluntary MRP charge in 2014-15. This will then reduce the MRP charges in future years.