Agenda item

To receive the latest budget monitoring position information.

Cabinet received a report providing the budget monitoring position up to 30 August 2017-18 for both revenue and capital budgets, including an update on key activity data for our highest risk budgets.

Mrs Crabtree, Deputy Cabinet Member for Finance introduced the report for members she reported that the overall net projected revenue variance as reported by budget managers was a pressure of £13.617m. Corporate Directors had adjusted this position by -£2.391m, leaving a residual pressure of £11.226m.  It was imperative that the budget was balanced this year in light of the increasing pressures that would be evident in the next two financial years.

The report set out the pressures experienced by each Directorate and the Deputy Cabinet Member ran through the headlines for members as follows:

      i.        Adult Social Care and Health reported pressures of £4.6million predominantly as a result of movement in Direct Payments for adults with learning and / or physical disabilities and older people; and increased costs of nursing and residential care across all client groups.  Early reductions had been promised by Directors and it was hoped that the additional £21.6million recently identified by Government for these services would ease some of the pressure currently being experienced.

    ii.        Children’s, Young People and Education reported a predicted overspend of £2.5million which included pressures in the areas of educational services, specialist children’s services and unaccompanied asylum seeking children.  In relation to the latter, Mrs Crabtree reported that another meeting with government was schedule to consider the matter and it was hoped that a solution would be agreed shortly. 

   iii.        Growth, Environment and Transport reported a smaller overspend of £500k and were confident that this would balance by year end.

   iv.        Finance reported an underspend of £1.4million

Mrs Crabtree continued and reported that the Capital Budget showed a variance £26.8million of which £20.7million was rephasing and £6m was real variance.

Andy Wood, Corporate Director for Finance, spoke to the item, he reported that he was confident that the budget would balance by year-end for the reasons report set out in the report and that, therefore, measures to stop key expenditure, such as a moratorium, would not be imposed.  Such measures, he explained created a risk to next year’s budget that was disproportionate to the risk of overspending in this year and it was a better strategy to continue with the stringent day to day controls that each Directorate already had in place.  He echoed Mrs Crabtree’s hope that a successful solution to the overspend in the area of asylum could be brokered at the meeting between the Leader and the Minister of State for Immigration the Rt Hon Brandon Lewis.

In conclusion Mr Wood reported that he had seen the most recent budget monitoring figures before the meeting and the direction of travel was positive.

The matter was opened for debate and the following comments were made and responses given to questions raised:

      i.                        That the Asylum overspend was currently reported at £3.9milllion. Further funding was included within the budget and the total cost for asylum was approximately £4.8million. The leader reminded members that this overspend was a significant portion of the council’s total predicted overspend.

    ii.                        That the trajectory of the budget was similar to last year which resulted in a final £600k underspend.  This was a fine margin on a £900million and could easily be a £600k overspend this year.

   iii.                        That the pressure on the budget was related to increased or unexpected demand on services and statutory duties.

   iv.                        That contingency in the budget for a ‘hard’ winter and the subsequent impact on roads would be held over in the event that weather conditions were good to clear weeds from the road in the following year.

The Leader concluded that it was positive that management action was seeking to address overspends in order to produce a balanced budget and should the outcome of the meeting with the Minister responsible for asylum be positive he was confident that the budget would balance at year end.

It was RESOLVED that: