Agenda item

This report updates the Committee on the work the Budget Sub-Group carries out during September and October 2017.

Declarations of interest:

None

Witnesses:

Kevin Kilburn, Deputy Chief Finance Officer

Key points raised during the discussion:

Ayesha Azad joined the meeting at 10.45am

1.    It was noted that the Budget Sub-Group was set up in July 2017 and had met on four occasions, most recently with the Select Committee Chairmen on 30 and 31 October 2017 to review progress against this year’s budget and discuss future planning.

2.    The Budget Sub-Group expressed concerns with Cabinet’s recovery plans where only £4m was realised, reducing the budget gap from £21m to £17m. The Sub-Group Chairman indicated that proposals were in place for Select Committees to individually look at budget areas.

3.    The Deputy Chief Finance Officer highlighted that in previous years the projections in September were different from the outturns due to actions to contain spending by services.

4.    In 2014/15, there was a projection for a balanced budget however there was a £13m underspend due to delays in IT and Property spend as well as in Children, Schools and Families.

5.    It was further stated in 2015/16, forecasts suggested a £1m underspend, however a £7m underspend was reached which was mainly due to holding vacancies when the Orbis Partnership was in development.

6.    In addition, last year’s forecast presented an overspend of £22m however this changed to an underspend of £6m as a result of altering the council’s strategy in borrowing from long term to short term. Furthermore the change of policy requiring less minimum revenue provision to be put aside for the future repayment of debt created a saving of £1.4m.

7.    Members noted that the budget at year end would be difficult to establish as forecasts can change and the previous years were an example of this.

8.    It was highlighted that the Invest to Save fund provided opportunities that could alleviate the existing main pressures in the Children, Schools & Families and the Adult Social Care & Public Health directorates. Members noted that potential investments would help contain service demand allowing better delivery.

9.    The Deputy Chief Finance Officer advised members that Cabinet’s recovery plan expectations were based on services reducing cost, holding vacancies and, where possible, delaying expenditure.

10.  The Deputy Chief Finance Officer asserted that the Council’s balance and reserves were sufficient to balance this year’s budget and indicated that there was enough to tackle an emergency or unforeseen circumstance. It was further added that a range of reserves were set aside for specific purposes such as vehicle and equipment renewal and possible liabilities the Council may incur.

11.  Despite the balance of reserves available it was highlighted that if they were utilised, then this would be a one off solution and would not tackle the existing demands the Council faced on a long term basis.

12.  Members noted that the reduction in funds for the voluntary sector would need to be addressed by the respective Committee and Directorate.

13.  The Committee noted that bonds could not be used for revenue purposes as statute prohibited borrowing or using capital monies to fund revenue expenditure.

14.  Members queried whether potential savings could be sought in reducing further back office functions. The Deputy Finance Officer explained that support service functions were significant in maintaining frontline services and clarified that substantial savings had already been delivered by Orbis in this area.

Tim Hall and Tim Evans left the meeting at 11.55am

Committee next steps:

The Budget Sub-Group’s next meeting will be held on 5 December 2017 and the programme will follow with a meeting with Cabinet on 12 December 2017 to review any recommendations formed through the budget process.