Agenda item

RESOLVED:

That the report be noted, including the following:      

1.         That the forecast revenue budget outturn for 2016/17 was a £15.0m overspend, down from £22.4m last month, as set out in paragraph 1 of the Annex to the submitted report.

2.         That forecast efficiencies and service reductions for 2016/17 were £62.9m, up from £60.3m last month, as set out in paragraph 42 of the submitted report.

3.         The Section 151 Officer’s commentary and the Monitoring Officer’s Legal Implications commentary, as detailed in the covering report, paragraphs 16 to 20.

4.         That virements to reflect service changes from creation of the Multi Agency Safeguarding Hub (MASH) and Early Help Services, as detailed in paragraphs 30 to 32 of the Annex to the submitted report, be approved.

5.         That officers and Members continue actions to reduce the 2016/17 overspend, as detailed in paragraph 4 of the Annex to the submitted report.

Reasons for Decisions:

This report is presented to comply with the agreed policy of providing a monthly budget monitoring report to Cabinet for approval and action as necessary.

[The decisions on this item may be called in by the Council Overview Board]

The Leader of the Council presented the budget monitoring report covering the period upto the 31 October 2016.

He said that last month, several significant financial risks crystallised, resulting in an unprecedented forecast outturn of £22.4m overspend for this financial year. However, by the end of October, the forecast outturn position had improved to £15.0m but the 2016/17 budget was still not balanced and neither had the County Council achieved a sustainable Medium Term Financial Plan.

He said that a significant issue was the £20m shortfall against the £83m savings target for 2016/17 and that this had a substantial and detrimental impact on the Council’s future financial position and it was not yet sustainable.

He informed Cabinet that there were many reasons why the County Council needed to keep working to restore its financial position. Not least, as pointed out in the Section 151 Officer’s and the Monitoring Officer’s commentaries, that it was a requirement of the Local Government Finance Act to ensure the County Council’s spending did not exceed its resources.

He advised Members that cost, demand and funding pressures had meant that there were overspends in Adult Social Care, Children’s Services and Special Education Needs and Disabilities (SEND), and that many of these pressures were preventing the Council from implementing its savings plans.

However, over the last month, the Chief Executive and Director of Finance had agreed a series of actions with Service Directors to review all planned spending and all service demands with a view to managing them more efficiently and that wherever sensible, the Cabinet would not agree further spending commitments until a balanced budget was assured and progress had been made towards a sustainable Medium Term Financial Plan.

He also said that the improvement seen in October’s financial position was largely due to increased income from the Investment Strategy, lower interest charges and additional savings in Property and Orbis but that it was imperative to find improvements across the board. Given the gravity of the situation, it was vital Members and officers continued their actions to identify and implement ways to reduce the overspend in 2016/17 and address the issues affecting the Council’s financial sustainability for 2017/18 and subsequent years.

Finally, he urged the Cabinet team and other leading Members to continue to bring the Council’s budget issues to the attention and understanding of Surrey’s MPs because the forecast £22.4m overspend closely matched the “shock” reduction in 2016/17 Revenue Support Grant that the Government imposed upon the County Council less than a year ago.

Other Cabinet Members were given the opportunity to highlight key points and issues from their portfolios.

RESOLVED:

That the report be noted, including the following:      

1.         That the forecast revenue budget outturn for 2016/17 was a £15.0m overspend, down from £22.4m last month, as set out in paragraph 1 of the Annex to the submitted report.

2.         That forecast efficiencies and service reductions for 2016/17 were £62.9m, up from £60.3m last month, as set out in paragraph 42 of the submitted report.

3.         The Section 151 Officer’s commentary and the Monitoring Officer’s Legal Implications commentary, as detailed in the covering report, paragraphs 16 to 20.

4.         That virements to reflect service changes from creation of the Multi Agency Safeguarding Hub (MASH) and Early Help Services, as detailed in paragraphs 30 to 32 of the Annex to the submitted report, be approved.

5.         That officers and Members continue actions to reduce the 2016/17 overspend, as detailed in paragraph 4 of the Annex to the submitted report.

Reasons for Decisions:

This report is presented to comply with the agreed policy of providing a monthly budget monitoring report to Cabinet for approval and action as necessary.