Agenda item

The report sets out the Council’s provisional budget outturn for the year ended 31 March 2017 and the Quarter 1 budget monitoring report to June 2017. 

Clive Heaphy, Chief Finance Officer introduced the report which set out the Council’s provisional budget outturn for the year ended 31 March 2017 and the Quarter 1 budget monitoring report to June 2017. During discussion of the report the following was noted:

a.    In response to a question, the Chief Finance Officer advised that underspends in the HRA account were ring-fenced to housing activities and would go back into the account to fund decent homes works etc.

b.    The Chief Finance Officer acknowledged the issue of a failure to spend allocations for capital projects and suggested that he would be pushing the Capital Board to demonstrate their ability to deliver on projects as part of the process, as well as introducing a stop on the carry forward of underspends in capital budgets.

c.    The Committee commented that the capital programme was an ongoing concern, notably a failure to deliver on earmarked projects; especially in light of the need for investment across a range of services. The Committee suggested that they would like to see the implementation of additional rigour within the capital programme put forward as a recommendation from OSC going forward. (Action: Clive Heaphy).

d.    The Committee questioned the £24m underspend in the HRA account in light of the shortfall in properties being up to decent home standards and sought clarification that this money could be invested in improvements to housing stock. The CFO cautioned that he needed to do some further work to understand the reasons behind the underspend. However, the CFO advised that he was working with the Interim CEO of HfH to look at the issue and acknowledged that reallocation of funding could start as part of next year’s programme.

e.    The CFO acknowledged the £1m underspend in the disability facilities grant and the need for services to roll this programme out as part of an  annual rolling programme. The CFO agreed to come back to the Committee with information on the underspend in Assessment and Social Work team being used as a mitigation for overspends elsewhere within Adult Social Services. (Action: Clive Heaphy).

f.     The CFO also acknowledged the demand led nature of the main budget pressures and that these pressures were not abating. The consequent off-setting of overspends from general reserves was not sustainable and that long term the key was to deliver better outcomes for service users at lower cost, whilst growing the revenue base from building more homes and increasing the number of businesses.

g.    The Committee sought clarification on the financial details of the saving related to the closure of the Park View depot, given that the staff were paid by the NLWA. (Action Clive Heaphy). 

h.    The current year Q1 position was a £6.6m overspend, made up of £6.2 overspend from the general fund and £400k in the HRA account.

i.      The CFO agreed to come back to the Committee on why the valuers were budgeted for up until  March when the HDV was agreed in July. The CFO also agreed to come back to the Committee on what savings were made from the closure of adult day centres and what the unintended financial risks were as a result. (Action Clive Heaphy). 

j.      The Committee queried whether the capital underspend could be used to buy street properties to offset the financial pressures on temporary accommodation. In response, the CFO advised that a range of alternatives were being sought to increase provision. It was suggested that a dispersed portfolio of street properties would likely be more difficult to manage than a consolidated block.

k.    The Committee emphasised the importance of schools claiming their full allocation of free schools meals as they were a driver for a variety of other funding sources from central government. The Committee suggested that Finance should be providing support to schools to ensure that take up of funding from free school meals was maximised.