The Interim Head of Finance and Section 151 Officerpresented a report providing Cabinet with an update on the Council’s financial position as at 30^th September 2018.

The Interim Head of Finance and Section 151 Officerreported that on 28^th February 2018, Council approved a net revenue budget of £265.984 million for 2018-19, along with a capital programme for the year of £33.693 million, which had since been updated to take into account new approvals and slippage between financial years. She explained that the overall projected position at 30th September 2018 was a net underspend of £2.551 million, comprising £738,000 net overspend on directorates and £5.269 million net underspend on corporate budgets, offset by new net earmarked reserves of £1.98 million.

The Interim Head of Finance and Section 151 Officer explained that the Council had recently received its provisional settlement for 2019-20 from Welsh Government and it was clear there would be pressures to meet going forward.

The Interim Head of Finance and Section 151 Officer explained that there had been no budget virements but there had been a number of technical adjustments between budgets since the quarter 1 forecast was reported to Cabinet in July 2018. She then gave a brief explanation of each technical adjustment.

The Interim Head of Finance and Section 151 Officer explained that a number of energy providers had announced price increases for 2018 and so additional funding for energy increases in 2018-19 averaging around 9% had been provided during quarter 2. The pay award for teachers from September 2018 was agreed in the middle of September. The UK Government had announced that it would give Wales an extra £23.5 towards pay for teachers but it was not clear how much Bridgend would receive.

The Head of Finance and Section 151Officer reported the net budget for the financial year had been set assuming full implementation of the current year budget reduction requirements. If proposals were delayed or not achievable, directorates had to identify alternative proposals to meet their requirements.   

For 2016-17 and 2017-18 there were £2.982 million of budget proposals that were not met in full, with a total outstanding budget of £2.523 million. The Interim Head of Finance and Section 151 Officer provided the latest position with a summary for each directorate. Of the £2.604 million outstanding reductions, £1.411 million was likely to be achieved in 2018-19 leaving a shortfall of £1.193 million.     

The Interim Head of Finance and Section 151 Officer gave an update on the Council’s capital programme for 2018-19 and explained the position regarding earmarked reserves. The cumulative drawdown by Directorates was £2.688 million from specific earmarked reserves and there had been net additions of £1.980 as shown in the report.  

The Interim Head of Finance and Section 151 Officerconcluded that the authority was in a better position than previously reported and the position on directorate budgets was pleasing.

The Deputy Leader asked for his thanks to be conveyed to the finance team. The report appeared to be satisfactory but it masked a number of issues they would be facing shortly. The Annual Report stated that 973 people had been diverted away from main stream services.  If this were not the case then the position would be far more challenging.  A fair funding settlement was needed from Welsh Government.

The Cabinet Member for Social Services and Early Help advised that when comparing the RAG status, there was very little change but there were still 2 quarters to go.

The Leader confirmed that Welsh Government had recently announced that there would be some additional funding for social services in the forthcoming year. This would be useful in light of the forecasted overspend in social services. The pressure was not just from children’s services but also from learning disabilities. The Leader added that it would be useful to receive a report to a future meeting. There were now more people with complex and severe disabilities and it would be helpful to review the provision and identify what future demands would be and to plan for the anticipated increase in demand.

The Corporate Director – Social Services & Wellbeing said that it was a significant pressure point and there appeared to be increased complexity in those with learning disabilities and they were also living longer.

The Leader stated that the settlement was gloomy and there was less money than the authority had in the previous year but they still had to find £4 million for schools to cover increased pension contributions and a pay increase for teachers. This would account for more than the income generated form a council tax increase of 4.9%. He reported that some good news had been received in that EU funding had been confirmed for the new water sports centre in Porthcawl.    

RESOLVED:             1.      That Cabinet noted the projected revenue and capital outturn position for 2018-19.

                                  2.           That a report on Learning Disabilities be      submitted to a future meeting.