Councillors and committees

Agenda item

Monthly Budget Monitoring Report

Decision:

RESOLVED:

 

That the report be noted including the following:

           

1.         Forecast revenue budget outturn for 2017/18 were £19m overspend (Annex 1, paragraphs 1 and 8 to 38). This included:
£9m savings to be identified,
£16m savings considered unachievable in 2017/18,
£14m service demand and cost pressures
less
£20m underspends, additional savings and income.

 

2.         Significant risks to the revenue budget (Annex 1, paragraphs 39 to 44 of the submitted report) could add £11m to the forecast overspend, included: £8m in Children, Schools & Families and £2m in Adult Social Care.

 

3.         Forecast planned savings for 2017/18 totalled £79m against £95m agreed savings and £104m target (Annex 1, paragraph 45 of the submitted report).

 

4.         All services continued to take all reasonable action to keep costs down and optimise income (e.g. minimising spending, managing vacancies wherever possible etc.).

 

5.         The Section 151 Officer’s commentary and the Monitoring Officer’s Legal Implications commentary in paragraphs 16 to 19 of the submitted report stated that the council had a duty to ensure its expenditure did not exceed resources available and move towards a sustainable budget for future years.

 

That the following be approved:

 

6.         Draw down £23,000 from Community Buildings grant scheme for planned spend on school kitchen schemes in 2017/18 (Annex 1, paragraph 61 of the submitted report).

 

7.         £0.5m of the current £0.8m Adult Social Care Major Adaptations capital budget  be spent on items purchased from the community equipment store capitalised under the accounting policy for community equipment from 1 April 2017 (Annex 1, paragraph 62 of the submitted report).

 

Reason 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 can be called in by the Overview and Budget Scrutiny Committee]

 

Minutes:

The Leader of the Council presented the budget monitoring report for period eight of 2017/18, up to 30 November 2017.

 

He explained that in February the council set its budget for 2017/18 in the face of:  significant rising demand pressures (particularly in social care); falling Government funding and continuing restraint on the ability to raise funds locally. To balance 2017/18’s budget the council had to make plans to deliver an unprecedented £104m of savings. This significant challenge for the council comes on top of already making over £450m savings since 2010.

 

He also explained that within the £104m savings target, the council had agreed plans for £95m savings, with £9m savings to be identified.   After eight months of the financial year, services have already achieved £55m of savings with another £19m on track for delivery, and £5m facing potential barriers. At this stage, £16m savings are now thought to be unachievable in this year.

 

The council’s 2017/18 budget included significant demand and cost pressures, mostly in social care. In the first eight months of the year, demand had increased above that forecast even a short time ago.   For example, in Children’s Services, demand continued to increase and was expected to add an £8m pressure by the end of the financial year. Partially offsetting these pressures, there were forecast underspends elsewhere, including in Children Schools & Families, Adult Social Care, Orbis, Highways & Transport, Waste and Central Income & Expenditure.

 

The combined impact of delivering lower savings than planned and demand rising faster than anticipated was a forecast year end overspend of £19m for 2017/18. This was a £1m increase on last month’s forecast position due to further market related cost pressures in Adult Social Care partly offset by savings and cost reductions in Orbis, Children’s services and Fire. Additional risks that were outside the council’s control may yet crystallise in some key budget areas and the forecast year end position could potentially worsen.

 

He concluded that services had already taken action as part of the recovery plan to reduce costs by £4m. However, he also stressed the need to continue to take all reasonable action to manage spending within available resources by keeping costs down, managing vacancies, optimising income and being aware of the current financial position before committing additional future expenditure.

 

Cabinet Members spoke of the financial and demand pressures as well as work being undertaking in their portfolio areas.

 

The Cabinet Member for Environment & Transport updated Cabinet on the Eco Park which was due to be operational by May/June 2018.  He stated that this was a good achievement, despite much opposition, and that it had been achieved by working together with partners.

 

RESOLVED:

 

That the report be noted including the following:

           

1.         Forecast revenue budget outturn for 2017/18 were £19m overspend (Annex 1, paragraphs 1 and 8 to 38). This included:
£9m savings to be identified,
£16m savings considered unachievable in 2017/18,
£14m service demand and cost pressures
less
£20m underspends, additional savings and income.

 

2.         Significant risks to the revenue budget (Annex 1, paragraphs 39 to 44 of the submitted report) could add £11m to the forecast overspend, included: £8m in Children, Schools & Families and £2m in Adult Social Care.

 

3.         Forecast planned savings for 2017/18 totalled £79m against £95m agreed savings and £104m target (Annex 1, paragraph 45 of the submitted report).

 

4.         All services continued to take all reasonable action to keep costs down and optimise income (e.g. minimising spending, managing vacancies wherever possible etc.).

 

5.         The Section 151 Officer’s commentary and the Monitoring Officer’s Legal Implications commentary in paragraphs 16 to 19 of the submitted report stated that the council had a duty to ensure its expenditure did not exceed resources available and move towards a sustainable budget for future years.

 

That the following be approved:

 

6.         Draw down £23,000 from Community Buildings grant scheme for planned spend on school kitchen schemes in 2017/18 (Annex 1, paragraph 61 of the submitted report).

 

7.         £0.5m of the current £0.8m Adult Social Care Major Adaptations capital budget be spent on items purchased from the community equipment store capitalised under the accounting policy for community equipment from 1 April 2017 (Annex 1, paragraph 62 of the submitted report).

 

Reason 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 can be called in by the Overview and Budget Scrutiny Committee]

 

 

Supporting documents: