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Budget Monitoring 2019-20 - Quarter 2 Revenue Forecast

Minutes:

The Interim Head of Finance presented a report, the purpose of which, was to provide Cabinet with an update on the Council’s revenue financial position as at 30 September 2019.

 

By way of background, she confirmed that on 20 February 2019, Council approved a net revenue budget of £270.809m for 2019-20, and that budget projections are reviewed regularly and reported to Cabinet on a quarterly basis.

 

Paragraph 4 of the report then showed a summary of the Council’s financial position at 30 September 2019, which reflected the Council’s net revenue budget and projected outturn for 2019-20 in Table 1 in this section of the report.

 

The overall projected position at 30 September 2019 is a net under spend of £575k, comprising £659 net over spend on directorates and £4.808 million net under spend on corporate budgets, offset by net appropriation to earmarked reserves of £3.574m.

 

The Interim Head of Finance proceeded, by confirming that the main reason for the under spend of £3.8m on ‘Other Corporate Budgets,’ is due to Welsh Government advising local authorities of additional grant funding being made available during 2019-20 to meet the increased cost of teachers’ pensions, fire service pensions and teachers pay increases, all of which were originally funded in full through the MTFS. A detailed analysis of the more significant projected under and over spends was set out in section 4.3 of the report.

 

Paragraph 4.2 of the report then outlined information in respect of the monitoring of Budget Reduction Proposals and paragraph 4.2.2 contained Table 2 detailing Outstanding Prior Year Budget Reductions. This reflected that of the £2.342m outstanding reductions, £1.795m is likely to be achieved in 2019-20, leaving a shortfall of £547,000. In respect of this, paragraph 4.2.3 of the report listed the proposals still not likely to be achieved in terms of reductions in certain areas.

 

Table 3 of the report then highlighted the Monitoring of Budget Reductions 2019-20 where it stated that the total budget reductions required totalled 7.621m, with £6.492 of these likely to be achieved, hence leaving a shortfall of £1.129m.

 

Appendix 2 identified the projected amount of saving against the proposals in detail and action to be taken by the directorate to mitigate the shortfall.

 

A summary of the financial position for each main service area was attached at Appendix 3 to the report and comments on the most significant variances were provided on a directorate by directorate basis in the next sections of the report. Some further narrative was then given on Council Wide budgets, whilst Table 4 then in paragraph 4.4.2 of the report gave details of Earmarked Reserves during Quarter 2, which amounted to £3.574m.

 

The Deputy Leader advised that there were significant challenges ahead, notwithstanding the level savings that the Council had been required to make to date as a result of austerity. Some reliance had also been made on staff vacancies in order to manage the levels of savings that were required under the MTFS. To this end, he noted that there were a number of staff vacancies in the area of Health and Safety within the Education Directorate and he asked if this was compromising the Authority in any way.

 

The Corporate Director – Education and Family Support advised that it had been difficult to recruit externally in the above area, though the section had increased from one specialist Officer to three including an acting-up Manager. The department were looking to train staff in-house to fill any void here.

 

The Head of Operations – Community Services advised that there had also been some improvement made in regards to contractual arrangements with Neath Port Talbot Council having committed to improving the current price by taking the facility back in-house as of 1 October 2019.

 

The Leader concluded debate, by noting that there was an over spend in respect of the provision of Learner Travel for ALN and those being educated in the medium of welsh.

 

The Corporate Director – Education and Family Support advised that this was due to the fact that extra bespoke vehicles for ALN had been required to meet a more than expected level of demand and a similar situation applied for the intake for welsh medium learners and those being taken to/picked up from Learning Resource Centres.

 

RESOLVED:                          That Cabinet noted the projected revenue position for 2019-20. 

Supporting documents:

 

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