Issue - meetings

1.      That the projected revenue budget underspend (Annex 1 – Section A) and the Capital programme direction (Section B) be noted.

2.    That government grant changes are reflected in directorate budgets (Section C) be noted.

Reasons for Decisions

To comply with the agreed strategy of providing a monthly budget monitoring report to cabinet for approval and action as necessary.

The Leader presented the Budget Monitoring Forecast report and made the following points:

Revenue – After eight months of the current financial year, and despite some significant demand pressures in both Adults and Children’s Social Care, a net underspending of £1.5m was currently being forecast, for this financial year. This was a variance of just 0.1%.

In setting the budget, a contingency against the risk of additional budget pressures and not achieving all of the savings and efficiencies in the Medium Term Financial Plan was prudently set aside. After applying £4.4m to cover the pressures in social care and highways, the council would underspend by £5.9m.

Strategic Directors and service managers were continuing to apply stringent management action plans to meet the savings and efficiencies target in the MTFP of £71m. The current forecast is that services will achieve £66m of these savings. However, the shortfall of £5m would be off-set by other savings, a large proportion of which were due to the underspending on staffing budgets. He said that he was working with Cabinet colleagues and Strategic Directors and Managers to find alternative on-going savings for the next financial year and beyond.

Staffing  - Directorates were continuing to actively manage their staffing budgets. This is through holding vacancies to achieve savings and the appropriate use of temporary workers. Currently there were 92% of staff on contracts which is considered to be right for a healthy organisation.

This has led to an underspending of £6.9m for the eight months to the end of November, and this is expected to fall to £5.1m by the end of the year as staff were recruited to essential services. The number of occupied posts in November has further increased to 7,330 – an increase of 64 from October – and 204 posts were being recruited to at the end of the month.

Capital – He said that he was determined to deliver the council’s capital programme this year, especially in providing additional school places and had asked officers to bring forward building schemes from future years and deliver more places for the county’s children earlier. In combination with real savings on the procurement of alternative accommodation, the current year’s School Basic Need budget of £32m is expected to be nearly fully spent. Overall the capital budget is expected to underspend by £4.6m, which is a significant achievement..

Cabinet Members had the opportunity to comment on the budget forecast variances of their portfolios.

RESOLVED:

1.      That the projected revenue budget underspend (Annex 1 – Section A) and the Capital programme direction (Section B) be noted.

2.    That government grant changes be reflected in directorate budgets (Section C).

Reasons for Decisions

To comply with the agreed strategy of providing a monthly budget monitoring report to Cabinet for approval and action as necessary.