1 THE ISSUE

1.1 This report presents the latest budget monitoring information for the Authority as a whole for the financial year 2002/2003. The report also includes a number of budget transfer requests that require Council Executive agreement or are reported for information purposes as prescribed by the Budget Management Scheme.

2 RECOMMENDATION

That the Executive:

2.1 Note the expenditure and income position for the Council in the financial year to the end of December and the year end projections detailed in Appendix 1 of this report.

2.2 Note the recommended carry forward use of potential underspends in Environmental & Consumer Services and Public Protection. (paragraph 3.8)

2.3 Approve the virements listed in Appendix 3.

3 THE REPORT

BACKGROUND AND CONTEXT

3.1 The Budget Management Scheme requires that the Council Executive consider the overall revenue budget monitoring position on a quarterly basis.

3.2 Where overspent, services are expected to seek compensating savings to try and bring budgets back to balance. The Budget Management scheme states that if overspending occurs it must be recovered.

REVENUE BUDGET MONITORING APRIL TO DECEMBER 2002

3.3 Page 1

Appendix 1 outlines the Council's current financial position for the 2002/2003 financial year to the end of December 2002 by portfolio. The Appendix shows a projected year-end overspend of £952,000 based on the service monitoring reports prepared to date. This compares to the predicted overspend of £404,000 reported to the Executive on 4^th December. Significant areas of over and under spend are highlighted in this report, but further explanations of the reasons for over and under spends in the current year are provided within the notes to Appendix 1.

3.4 Social Services are forecasting a year-end overspend of £450,000 made up of the following factors. Children's Services are predicted to overspend by £250,000 due to increased costs of placements and Adult Services by £150,000 due to overspends on the purchase of domiciliary care and the requirement to reimburse some preserved rights funding. Elderly Persons Homes are predicted to overspend by £50,000 due to increased salary costs partially offset by additional income and savings achieved by the early closure of Greenacres.

3.5 Education forecast a year-end overspend of £276,000 due to an increase in pupil numbers over estimates, increased statementing costs, additional home to school transport cost and an increase in the number of four year old children attending nursery settings. These overspends are partly offset by savings resulting from a restructuring in the Youth & Community Service.

3.6 Transportation & Planning Policy are projecting a year-end overspend of £152,000. This is the result of overspends in the following areas, Transportation (£157,000) due to additional costs from the concessionary fares scheme and the increased amount of Bus revenue support arising from increased demand and service provision. Network Management (£62,000) due to additional costs incurred in maintaining the Authorities' highways. Measures to meet a £80,000 Corporate savings target in transport budgets have not been identified. These overspends are partially offset by increased levels of income achieved through the Council's Car Parks (£143,000) and Park & Ride service (£29,000). The balance on this portfolio is made up of other minor over and under spends.

3.7 As reported in December, the Council has continued to experience a strong level of fee income resulting from increased requests for Local Land Charges and Building Regulation approvals. As a result, the Public Protection service is expected to underspend by £94,000 this financial year. Environmental & Consumer Services are also expected to over achieve their income targets during the current year and are projecting an underspend of £30,000.

3.8 The Budget Management Scheme (BMS) allows the carry forward of underspend subject to a number of conditions being met. An extract of the BMS relating to carry forwards is attached at Appendix 2 for reference. Subject to the final year end position, the Director (Economic & Environmental Development) proposes to use the carry forward of underspends detailed in paragraph 3.7 towards the funding of the Environment & Consumer Best Value Action Plan and to assist with the 2003/04 budget proposals for Environment & Consumer Services. All carry forward requests will be considered by the Council Executive when the final revenue out-turn report is presented.

VIREMENT REQUESTS 2002/2003

3.1 Budget Transfers (Virements) requiring Council Executive approval are listed in Appendix 3 together with explanations of why the transfer is necessary.

3.2 Appendix 4 indicates the effect upon Service and Portfolio cash limits if these proposals are approved.

3 CONSULTATION

4.1 This report was sent to Trade Unions on (to follow).

APPENDIX 2

Extract of the Budget Management Scheme

Carry Forward

14. With effective budget planning and management, overspending should not occur. If, however, one occurs it must be recovered.

15. Heads of Service will be able to carry forward under spends on their cash limits subject to the conditions below.

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