Agenda item

Zena Cooke (Corporate Director of Finance) was in attendance for this item.

1.    Mr Oakford (Deputy Leader and Cabinet member for Finance, Corporate and Traded Services) introduced the report that set out the revenue and capital budget monitoring position as at September 2023-24. The latest revenue forecast outturn position for 2023-24 before further management action was an overspend of £36.0m (excluding schools). The forecast overspend represented 2.7% of the revenue budget and presented a serious and significant risk to the Council’s financial sustainability if not addressed as a matter of urgency. Within the overall outturn position there continued to be a significant forecast overspend in Adult Social Care & Health, totalling £30.4m and in Children’s, Young People and Education totalling £28.1m, before management action. Work continued to identify and implement further management action that could be taken immediately in the current year, and over the medium term and was included in the report and in the “Securing Kent’s Future” budget recovery plan.

Mr Oakford said that it was essential that the remaining management action was delivered to reduce the 2023-24 outturn to a balanced position and prevent the need for a drawdown of reserves which would further weaken the council’s financial resilience and increase the requirement to replenish reserves in succeeding years. The majority of the management actions were related to one off measures, meaning those spending reductions would not flow through to the 2024-25 budget. Furthermore, the full year recurring impact variance against the budget of 2023-24 would need to be reflected as spending requirements in the 2023-24 budget.

The initial draft revenue budget for 2024-25 and the Medium Term Financial Plan for 2024-2027 had been published and showed gaps in each one of the financial years. The gap for 2024-25 was the most significant and needed to be closed through further savings, increased outcome and future cost increase avoidance. A detailed analysis of the overspend continued to be undertaken to identify underlying causes. The council implemented spending controls across all budget managers to avoid spending for the remainder of the year wherever possible, based on specific criteria to focus on the most essential activities and priorities until the financial position was brought under control and stabilised. The outcome of the analysis, the actions and progress to date in reducing the forecast overspend was presented further within the report.

The Recovery Plan to reduce the forecast for 2023-24 and the budget gap for 2024-25 continued to be monitored weekly. If significant spending reductions were not achieved within the next reporting period and the direction of travel was not positive, then more stringent spending controls would be implemented.

2.    Mrs Cooke confirmed that weekly monitoring took place at the Corporate Management Team Meeting (CMT) where officers would discuss in detail elements of spending for review that concurred with the seriousness and action that needed to be taken.

3.    Mr Oakford advised that the report contained underspends in Member Grants, however, a majority of this money had already been committed for a number of member projects. Mr Oakford acknowledged Members’ comments regarding the change in reporting methods which would represent a clearer reflection of the money allocated but not spent. 

4.    RESOLVED to agree the recommendations as outlined in the report.