In November 2018 we published our framework for reviewing, monitoring and managing the level of administration costs and unspent funds claimed and held by Environmental Bodies (EBs).
The aim of the framework is to help facilitate the delivery of two of HM Revenue & Customs (HMRC's) strategic priority objectives for the Landfill Communities Fund (LCF):
- The level of administration costs incurred by EBs, should be at or below the guidance level of 7.5 per cent of project expenditure; and
- The value of unspent funds held by EBs should be reducing year on year.
Unspent funds are those LCF funds remaining as a cash balance at the end of each reporting period, including committed and uncommitted funds. EBs are required to state within their Statutory Annual Return whether these funds are committed to projects or required for winding up. Any other funds are classed as uncommitted. New guidance was also published that an EB's total unspent funds at year end should be no more than 1.5 times an EB's LCF income (including contributions and transfers) in that year. This information was sent by email in November 2018 and January 2019 to the relevant EBs.
We would like to remind EBs of the new guidance referred to in the framework relating to unspent funds, and recommend that if they are not meeting the guidance level, they take appropriate action to reduce unspent funds before 31 March 2019 and the end of the Statutory Annual Return (Form 4) period.
You can access the framework on the new Administration Costs and Unspent Funds page of our website. You can also access the updated guidance on the unspent funds level in section 3.6 of our Guidance Manual and the guidance on administration costs in section 3.12 of our Guidance Manual both of which can be found on the Guidance page of our website.