Cabinet is asked to:
- note the revenue and capital forecast outturn position, savings monitoring and reserves monitoring
- approve any additional management actions required
- note and agree revenue and capital cash limit changes
Reason for the decision
Quarterly reports are presented which identify any management action required and recommendations for Cabinet decision.
Background
The report on the Council’s latest financial position will be reported to Cabinet on 26/09/24, and shows a forecast overspend of £16,344.9 excluding Schools’ Delegated Budgets. The forecast overspend presents a serious and significant risk to the Council’s financial sustainability if it is not addressed as a matter of urgency particularly as the approved budget for 2024-25 did not include any contingency provision meaning any residue overspend can only be offset from reserves. The report identifies the latest progress on savings compared to the original plan, any undeliverable savings are already reflected in the forecast. The most significant overspends are in Adult Social Care, and Growth, Environment & Transport Directorates, due to a combination of unachievable savings and unplanned spending increases.
Options (other options considered but discarded)
- The Council has already continued the spending controls introduced in 2023-24 into 2024-25 aimed at curtailing non committed spend, any further extension of spending controls is likely to impact on the Council’s ability to fulfil its statutory responsibilities.
- All options to reduce spend both one off and recurring are being considered to bring the 2024-25 budget back into balance.
How the proposed decision supports the Framing Kent's Future - Our Council Strategy 2022-2026
How the proposed decision supports Securing Kent’s Future
Securing Kent’s Future (SKF) acknowledges that given the significance of adults and children’s social care within the council’s budget, and that spending growth pressures on the council’s budget overwhelming (but not exclusively) come from social care, that the priority of delivering New Models of Care and Support must take precedence over the other priorities in Framing Kent’s Future. This creates an expectation that council services across all directorates must collectively prioritise delivering the new models of care and support objective as a collective enterprise.
The Finance Monitoring report for June 2024-25 provides the detail of the latest financial position and the relevant information on the progress being made in terms of the savings and management actions to reduce the budget gap for the following year and the MTFP.
Decision type: Key
Reason Key: Expenditure or savings of more than £1m;
Decision status: For Determination
Division affected: (All Division);
Notice of proposed decision first published: 23/08/2024
Decision due: 26 Sep 2024 by Cabinet
Reason: Decision-making Executive committee
Lead member: Deputy Leader and Cabinet Member for Finance, Corporate and Traded Services
Department: Strategic & Corporate Services
Contact: Cath Head, Head of Finance Operations Email: cath.head@kent.gov.uk Tel: 01622 221135.
Consultees
A report will be presented to Cabinet on 26th September 2024.
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 following year’s budget also need to be identified and delivered. The Council will need to continue to limit its actions to avoid spending and 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 and actions identified to secure the council’s financial sustainability and improve its resilience are delivered both in year and in the medium term. 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: No direct service impact from the monitoring report– the equalities implications of the savings and management actions will be managed at service level.