To provide Cabinet with an update on the Council’s financial position as at 30^th September 2015.

The Corporate Director Resources reported on an update on the Council’s financial position as at 30 September 2015.  She stated that there was an overall projected under spend of £1.346m which comprised under spends of £571k on Directorates and £775k on corporate budgets.  The budget had been set on the basis of budget reduction requirements across the Council’s budget of £11.225m.  The Medium Term Financial Strategy (MTFS) approved by Council in February 2015 and updated in July 2015 identified the need to develop recurrent budget reduction proposals of around £49.6m over the next four years.  She stated that consideration would be given at year end to requests from Directors to carry forward any planned Directorate underspends for specific purposes into the following year. 

The Corporate Director Resources also reported on the monitoring of budget reduction proposals in that 83% of the proposals are green and 17% are either amber or red.  Directors continue to work to deliver their proposals or would have to find alternative proposals. 

The Corporate Director Resources reported on the monitoring of the capital programme for 2015-16 which totalled £40.252m of which there was a projected under spend of £70k against budget and slippage against the revised budget of £1.659m to be carried forward into 2016-17.  This mainly affected the Vibrant and Viable Places scheme and the provision of temporary accommodation at Tondu Primary.  She stated that at this point in the financial year and following discussions with Directorates that projects will be in line with the revised budget.  However this was dependent on any inclement weather which may be experienced which may place additional pressure on project timescales. 

The Corporate Director Resources also reported that the Council is required to maintain adequate financial reserves to meet its needs.  She stated that Directorates in the first half of 2015-16 had drawn down £236k of funding from their Directorate specific earmarked reserves and £1.793m from Corporate Reserves including the Major Claims Reserve.

The Cabinet Member Resources informed Cabinet that it was pleasing to note that in a challenging financial year with £11m budget reductions having to be made, Directorates are doing their utmost to achieve those reductions and balance their budgets.  He stated that 83% of the budget reductions are on target to be achieved and Directorates are on target to generate a net under spend of £500k, with a further £700k generated from corporate budgets. 

The Cabinet Member Resources also informed Cabinet that those under spends will be used to support specific Directorate corporate risks and pressures in the current and forthcoming financial year, in which the Council is expected to have to make a further £13m of budget reductions.  He stated that budgets would continue to be monitored closely to assess how best to maximise the under spend to reduce future years running costs either by repayment of debt, or investing in additional capital works through the capital programme. 

The Cabinet Member Resources stated that details of the Local Government Settlement for 2016-17 were awaited and it was expected the financial challenge ahead will at least be similar to this financial year.  He was reassured that Directorates are managing their finances in a controlled way, with no significant major budget variances impacting on the Council General Fund. 

RESOLVED:               That Cabinet noted the projected revenue and capital outturn                                  position for 2015-16.