Meeting documents

1 THE ISSUE

1.1 This report presents the provisional revenue and capital outturn for 2006/07. The report refers to known potential pressures for the current year, as a preface to a request to carry forward specific budget items to 2007/08, and to write-off overspends where recovery in future years, in combination with containing those pressures in the current year, would have a major adverse impact on continuing service delivery.

2 RECOMMENDATION

2.1 The Cabinet approves:

(1) The provisional revenue budget outturn for 2006/07 as set out in Appendix 2 at £314,000 under spent or 0.3% of the Council's revenue budget for 2006/07 is noted. The underspend including the Local Authority Business Growth Incentive Scheme grant income is £1,415,000 (Appendix 1 Paragraph 1.1).

(2) The carry forward proposals and write-off requests listed in the tables in Appendix 4 as exceptions to the Budget Management Scheme. The approval of write off requests is conditional upon action plans being in place to meet the ongoing implications in 2007/08 onwards.

(3) The creation of earmarked reserves of £100,000 in respect of Continuing Health Care.

(4) That any resulting surplus arising from decisions made should be returned to unallocated general fund balances.

(5) The revenue virements listed in Appendix 7

(6) The provisional outturn position of the 2006/07 capital programme (Appendix 5).

(7) The adjustments to and incorporation of additional funding to the 2006/07 capital programme as detailed in Appendix 6, including funding part of the programme from Local Public Service Agreement capital reward grant.

2.2 The Cabinet delegates the agreement of carry forwards for capital under and over spends arising in 2006/07 to the Council's Section 151 Officer in consultation with the Chief Executive and Projects Programme Board (Appendix 1 Paragraph 1.12).

2.3 The Cabinet notes the reserves position shown in Appendix 8, including the transfer to general reserves of £680k from IT provisions (Appendix 1 Paragraph 1.25), and that as a result the Council's reserves strategy is ahead of target (Appendix 1 Paragraph 1.23).

2.4 The Cabinet notes the implications of the outturn 2006/07 in 2007/08, (Appendix 1 Paragraphs 1.13-1.15) and that action plans are being prepared by Strategic Directors and Assistant Directors to address these implications.

2.5 The Cabinet notes the Treasury Management Outturn position (Appendix 9).

3 FINANCIAL IMPLICATIONS

3.1 These are contained throughout the report and appendices.

4 COMMUNITY STRATEGY OUTCOMES

4.1 The report concerns the financial management of the Council which underpins implementation of the corporate plan, and hence the delivery of community strategy outcomes.

5 CORPORATE IMPROVEMENT PRIORITIES

5.1 The Annual Financial and Service Planning process allocates scarce resources across services with alignment of these resources towards our corporate improvement priorities as set out in the Corporate Plan. This report monitors how the Council is performing against the financial targets set in February 2006 through the Budget setting report.

6 CPA KEY LINES OF ENQUIRY

6.1 The report provides the Cabinet with information on financial performance against the Council's budget as assessed under the "Financial Management" and "Financial Standing" Key Lines of Enquiry, which is part of the Use of Resources element of the CPA.

7 THE REPORT

7.1 This report provides information about the Council's financial performance against its revenue and capital budgets in 2006/07. The report also provides information on the Council's Treasury Management position and performance during 2006/07.

7.2 Details and commentary of the outturn position for the revenue and capital budgets are provided in Appendices 1-8. The Treasury Management outturn position is presented in Appendix 9.

7.3 The report follows the format of reporting services by the previous Executive portfolios. Requests for carry forward are also listed according to previous Executive Portfolios (see Appendix 4).

7.4 The Corporate Audit Committee will approve the statutory final accounts of the Council. This report presents the provisional outturn in the form that is routinely reported throughout the year as part of budget monitoring.

7.5 The Executive received financial reports throughout the year highlighting the known pressure areas, and identifying those actions that could be taken to reduce these to manageable proportions.

7.6 A Budget Management Scheme (BMS) is in force, which specifies how over and under spending should be treated in any year.

7.7 Under the Budget Management Scheme all overspends should be carried forward, subject to a proposal from the service to recover them. At least 60% of any under spends can also be carried forward providing that the management of all overspendings have been agreed within a Strategic Director's service areas and also providing these under spends were reported at the latest in January 2007. If not reported by then, they are considered "windfall" and should not be carried forward unless the Cabinet expressly approves such carry forwards.

8 RISK MANAGEMENT

8.1 The report author and Lead Executive member have fully reviewed the risk assessment related to the issue and recommendations, in compliance with the Council's decision making risk management guidance.

8.2 As a result of the 2006/07 financial outturn, the Strategic Directors have updated their Robustness of Estimates Reviews for 2007/08 with the Interim Director of Support Services.

9 RATIONALE

9.1 The recommendations made are based upon the Budget Management Scheme and a consideration of the Council's latest financial position and reserves strategy.

10 OTHER OPTIONS CONSIDERED

10.1 Appendix 4 lists all options that can be considered in making a decision on carry forwards and write offs from 2005/06 to 2006/07.

11 CONSULTATION

11.1 Executive Councillor for Resources; Interim Director Support Services; Section 151 Officer; Chief Executive, and Monitoring Officer.

11.2 A draft of this report has been discussed at Strategic Directors Group and Assistant Directors Group during May 2007.

12 ISSUES TO CONSIDER IN REACHING THE DECISION

12.1 The key consideration arising from the 2006/07 outturn is the ongoing implications of overspends in 2007/08 and future years. Strategic Directors are preparing action plans to address these issues as well as savings planned a part of the 2007/08 budget.

13 ADVICE SOUGHT

13.1 The Council's Monitoring Officer (Council Solicitor) and the Interim Director Support Services have had the opportunity to input to this report and have cleared it for publication.