Decision details

CAB 52/17 

July Revenue Budget Monitor

Options Considered/Reasons for Decision

The Leader presented the latest Revenue Budget Monitor, detailing the current forecast position on the Council’s revenue budget as of the end of July.  When the last monitor was considered in July, Cabinet noted the ongoing pressures and overspends within the budget, which were able to be managed through underspending in other areas.  This latest report now showed a forecasted overspend of £1.4m at the end of July.  The Council was able to offset this through using the unused revenue budget contingency, bringing the budget to an almost balanced position. 

The reasons for budget pressures were understood, and spending was being monitored and managed closely to bring the forecasts back to a more comfortable position.  However, a significant part of the pressures were due to areas outside of our control.  Increasing out of area placements, for both Education and Children’s Services, were an unpredictable and significant element.  The Council was doing what it could to manage these pressures within the Council, but this was also a national issue.  The Leader reported that she would be raising this through the WLGA, to suggest that a national approach was taken, to highlight with the judiciary the financial impact of the decisions made in court on the provision of care packages.

The Leader highlighted that the budget was everybody’s responsibility across the Council, and the administration would do everything it could to balance the budget by year end. 

The Head of Finance highlighted the importance of managing the budget, and the knock on impact of overspending for next year’s budget if it was not brought under control.  The Chief Executive also noted that the overspend represented less than 1% of overall spending, and was in line with similar patterns of spending in previous years.  He assured Cabinet that appropriate actions would be taken to deliver a balanced position by the year end.

Decisions:

To note the overall budget forecast position and the key assumptions and issues which underpin and impact on the Council’s financial forecast position.

To approve the use of all the Council’s contingency budget to balance the current level of overspending, which will be assessed each month on an on-going basis.

To agree to instruct all areas of the Council to maintain robust financial management and bring forward planned underspending wherever possible to mitigate against the current position.

To note the level of undelivered savings within each directorate and the risks associated with this.

To note the forecast movements in reserves.

To note and ratify the Corporate Management Team’s decision to implement a targeted spending freeze for all non-essential spend.

To agree the use of and note the balance in respect of the investment reserve which has been assumed within current forecast.

Consultation

Strategic Directors, Head of Finance, Heads of Service, Budget Holders, Accountancy Staff

Implemented By:   Cabinet Members, Head of Finance, DMT, CMT