Issue - meetings

[Report of the director for  Finance. To be introduced by  the Cabinet Member for Finance]

To provide Cabinet with an update on budget performance for the year to date and likely financial outturn position for 2018/19.Consideration of any proposed budget virements as at the end of quarter 2.

The Cabinet Member for Finance introduced this report which set out budget variances, including those arising as a result of the forecast non-achievement of Cabinet approved MTFS savings.

The Cabinet Member outlined that the budget was a projection of the Council’s finances for the end of 2018/19. It was projected there would be an overspend of £9.3m which was mainly due to the non-delivery of previously agreed savings in the Adults and Children services. This was also after applying use of the Council’s reserves within the year to account for £7m of overspend. The Cabinet Member noted the difficulty delivering savings on necessary services and that savings should now be written off as the demand and cost of services meant these savings could not be delivered. The Cabinet Member noted the demoralising effect on officers/staff delivering a service with the pressures of saving money. Attempting to make savings in areas such as the Adults and Children services was not realistic as the Council could not turn away from the most vulnerable and high need members of society.

Following questions from Cllr Blake, Cllr Das Neves and Cllr Morris, the following was noted:

·         There was no update from the central government on the funding for local authorities, following events at Westminster on 11 December 2018. This was now due to be provided before 25 December.

·         The Cabinet Member acknowledged that writing off those previously agreed savings was about accepting the reality of the situation. More money was due to be provided to Adults and Children services for 2019 and 2020. This would require reviewing the budget and identifying areas where it was possible to raise income or change service delivery to save on costs.

·         The Cabinet Member noted it was absolutely the intention, in line with legal requirements, for the Council to deliver a balanced budget in 2019 and 2020.

·         Regarding changes to the previous administrations commitments, the Cabinet Member noted the change in the commercial portfolio, such as the ending of the Haringey Development Vehicle. The Council also now had rental income from commercial assets it owned for which it was seeking to maximise the income for the Council. Where possible, services that the Council felt it could better deliver in-house and save on costs were being explored.

·         Regarding how long the Council would be able to maintain a budget gap, the Cabinet Member responded that many councils were in the same position and this would depend on reserves available to Councils which was likely to be only a few years.

·         Regarding the frequency of the monitoring reports to Cabinet, Officers noted that the quarterly reports were in line with the practice of most local authorities. Additionally, the corporate process of the Council had a regular internal budget review. This review outside of Cabinet allowed for constant monitoring of the budget through reports. Officers stressed there was a balance that needed to be made between the formulation of reports and the action time needed to address the issues within them.  ...  view the full minutes text for item 34