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 overall forecast position as at 31 October 2023-2024, which presented a revenue overspend of £35.6m before management action. The forecast overspend represented 2.7% of the revenue budget and continued to present a serious and significant risk to the Council’s financial sustainability. Within the overall outturn position there were still significant forecast overspends in Adult Social Care & Health totalling £31.3m, and in Children’s, Young People and Education totalling £28.9m before management action. Planned management action has been identified to bring the forecast outturn to within budget by the end of the financial year.

It remained essential that all management action be delivered as planned to prevent the need to use Council reserves as this would further weaken the Council’s financial resilience and would increase the requirement to replenish reserves in succeeding years. The majority of the management actions were related to one off measures; therefore those spending reductions would not flow through to the 2024-2025 budget position.

The need to restrict spending where possible had been communicated across the Council with guidelines for all staff. The spending controls in place to reduce the forecast overspends for 2023-2024 were being monitored weekly. Spending trends were also reviewed and reported to the Corporate Management Team (CMT) and the Member Finance Oversight meeting on a weekly basis. Whilst spend was reducing it was not at the pace required to balance the budget and therefore had not resulted in the corresponding reduction in the forecast. It was therefore likely that further, more stringent spending controls would be implemented.

The latest forecast projection also indicated that the outturn position was worsening. The summary position at the end of November would be presented to Cabinet on 25^th January 2023.

The draft revenue budget for 2024-2025 and the Medium-Term Financial Plan (MTFP) for 2024 -2027 was published on 3^rd January.

Mr Oakford commented on the acknowledgment from Cabinet on the degree of work that had been done across the Council to reduce spend and commended the support from the Corporate Directors and management teams in addressing the challenge; however, the Council needed to make further savings to balance the budget. The pressure of demand in the growth of the Council’s services continued to outweigh the increase of income and therefore more stringent spending controls would need to be implemented.

2.    Mrs Cooke confirmed that the organisation was acutely aware of the Council’s financial situation, however, the Council was struggling to meet the pressures of inflation in both the Adult Social Care and Children, Young People and Education sector. Alternative spending control measures had been introduced and were monitored on a weekly basis, however, the position for the Cabinet meeting on 25^th January 2024 would not be improved. CMT would continue to identify further action to bring the budget back into a balanced position by the end of the financial year.

3.    RESOLVED to note the recommendations as outlined in the report.