Agenda item

Revenue & Capital Budget Monitoring, Cash Limits and Virements – April to October 2018

This report presents the financial monitoring information for the Authority as a whole for the financial year 2018/19 to the end of October 2018.


Councillor Richard Samuel made an ad-hoc statement saying that there was £50k of underspend in July 2015 and today the figure was £4.1m of overspend.  Councillor Samuel also said that Council’s reserves have been depleted.


The Chair explained that during the last 4 years the Council had to find £50m in savings, whilst also protecting the most vulnerable.


Councillor Charles Gerrish introduced the report by highlighting the following:


a)  Revenue budget


The Revenue budget outturn was currently forecast to be £4.1m over budget. This is £1.5m higher than the £2.6m reported previously and this was mainly due to unmitigated delays in savings delivery of net £1.8m, additional demand in Children’s Services £2.2m, and a £1.2m shortfall in income from Commercial Estate. This has been partially offset by a forecast under budget position of (£0.86m) resulting from Council funded growth allocations now being funded from additional grant in Adult Social Care. Urgent actions have been put in place thorough Recovery Plans to mitigate this position. The report highlighted which savings were delayed and which were considered high risk and may not be delivered. Those that were delayed can be supported through the smoothing reserve but this would utilise all of the reserve allocation for 2018/19.



b)  Capital budget


The capital budget was currently showing an expected under budget position of £11.4m mainly due to slippage and re-phasing.


This report would also seek approval to make adjustments to the current capital programme following the review that has been carried out to support 2019/20 budget planning. 


c)  Council tax and Business rates


The current forecast Council’s share of the year end Collection Fund position was:

  Council Tax – Surplus of £0.760m (2017/18 Deficit £0.154m)

  Business Rates – Deficit of £0.259m (2017/18 Deficit £1.473m)


Business rates collection remained slightly lower than target and would continue to be monitored closely over the next few months


d)  Council Reserves


Council reserves would be required to mitigate the current position if the actions being put in place were not successful. The Budget Contingency Reserve which has been set up to mitigate budget risk would be completely depleted with a further £0.53m requirement from Un-earmarked Reserves. This would reduce General Fund Un-Earmarked Reserves to below the range required to meet the Council’s financial risks and therefore required a review of all reserves and a requirement for further savings to replenish them in 2019/20.


Councillor Charles Gerrish moved the recommendations.


Councillor Paul May seconded the motion by saying that the Cabinet has been open and transparent to the public in terms of the budgetary position.  Councillor May added that the demand in children services was higher due to increased costs from new residential placements as a result of children being at risk of harm, as well as a number of children having to move from foster care into more expensive residential care due to the complexity of their needs.


RESOLVED (unanimously) that the Cabinet agreed:


1)  To note the 2018/19 forecast over budget of £4.1m (as at the end of October 2018) and the recovery plan actions outlined in Appendix 1;

2)  To note the mitigations that will be required shown in paragraph 5.6, if the over budget position cannot be reduced by the end of the financial year

3)  To note the capital year-end forecast detailed in paragraph 5.17 of this report;

4)  To approve the revenue virements listed for approval and note the virements listed for information in Appendix 3(i);

5)  To note the changes in the capital programme including capital schemes that have been agreed for full approval under delegation listed in Appendix 4(i)

6)  The capital schemes listed in Annex 4(iii) for removal / deferment from the current 5 year capital programme.


Supporting documents: