Reason for Decision:
Given the Council’s financial position, Cabinet now receives a monthly report setting out the latest forecast and actions being taken to balance the budget by the end of the financial year. Adjustments to both the revenue and capital budgets which reflect a reallocation between Key Services in light of the 2022-23 final spend and activity levels and the latest service transformation plans require approval from Cabinet. Cabinet approval is also required for the proposed additional contributions to, and transfers between reserves, as effectively these represent a variation from the approved budget, and the award of a call-off contract for Early Payment Services.
A high-level position report on the Council’s financial position as at the end of June 2023 was reported to Cabinet on 17th August 2023 which showed a forecast overspend of £43.7m before management action. As part of that report, it was agreed that the Cabinet on 5th October would receive a progress update report setting out in more detail the additional actions taken and those actions and decisions requiring Cabinet approval to bring the forecast overspend down to as close to a balanced position as possible. The report would set out the framework for the medium to longer term plan for “Securing Kent’s Future” with sustainable spending and sufficient financial resilience.
How the proposed decision supports the Strategic Statement:
Framing Kent’s Future (FKF), the KCC Strategic Statement, was approved at County Council in May 2022 and sets out the council’s ambition and strategic priorities until 2026. FKF acknowledged the significant financial and demand pressures the council would be facing over the coming four years, whilst concurrently delivering an ambitious agenda for Kent residents, businesses, and local communities.
The Securing Kent's Future plans and this related Finance Monitoring report 2023-24 reflects the need to confirm a re-prioritisation of Council business within the framework of Framing Kent's Future - further details are set out within the “Securing Kent's Future” Cabinet report.
Options considered:
The finance monitoring report could continue to be provided quarterly but it is critical that the financial position is considered more regularly to ensure the decisions needing Cabinet approval to balance the budget can be taken as quickly as possible.
Decision type: Key
Decision status: Recommendations Approved
Notice of proposed decision first published: 27/09/2023
Decision due: Not before 5th Oct 2023 by Cabinet
Lead director: Zena Cooke
Contact: Cath Head, Head of Finance Operations 03000 416934 or Email: cath.head@kent.gov.uk Email: cath.head@kent.gov.uk Tel: 01622 221135.
Consultees
This report will be presented to Cabinet on 5th October 2023
Finance and performance monitoring progress reports will be considered at every Cabinet meeting, to ensure the focus on Securing Kent’s Future remains until the council’s financial position is stabilised.
Financial implications: This finance monitoring report sets out the latest forecast overspend position and the underlying structural budget deficits which need to be addressed. The savings and management actions set out in the report need to be delivered to ensure the council’s budget is balanced by the end of the financial year, and further actions to reduce costs that will impact the 2024-25 budget also need to be identified. The Council will need to continue to limit its actions to focus on the most essential activities and priorities until the financial position is brought under control and stabilised.
Legal implications: This is in accordance with the financial procedures as set out in the Constitution, the Financial Regulations and Code of Corporate Governance. The current financial situation and operating environment presents a number of material risks to the Council. It is important that the plans identified to improve resilience are delivered in order to avoid further escalation and action. Securing Kent’s Future notes the increased legal risk faced by the Council and the actions and monitoring position will need to be continually reviewed.
Equalities implications: Equalities Implications: No direct service impact – any future substantive changes to be managed at service level Data Protection Implications: None