Agenda item

            That the report be noted.                 

The Head of Finance introduced a report to provide Members with the Revenue Budget Monitoring 2012/13 (Month 8) report which was being submitted to Cabinet on 19 February 2013. 

                        The projected year end underspend of £0.611m on the Council Fund was a significant improvement to the projected overspend of £0.516m reported at Month 7.  The significant in-year projected variances to date were detailed in appendices 2 to 6 and the table in the report showed the changes from Month 7 to Month 8.  The improving position of the Out of County Placements underspend was as a result of smarter procurement from the continued involvement of Commercial and Clinical solutions and reduced numbers of placements which had been influenced by the development of in-county provision from foster care and within special schools. 

                        The Contingency Reserve projected at year end as a result of the projected underspend was £1.267m but it was being recommended to Cabinet that an allocation of £0.770m from the reserve be made in 2012/13 to make provision for the triggering of the Municipal Mutual Insurance (MMI) scheme of arrangements which was now needed in accordance with Accounts & Audit regulations.  This would leave an estimated balance of £0.497m in the Contingency Reserve at 31 March 2013.  The Head of Finance explained that a report on MMI was being submitted to Cabinet on 19 February 2013 and that she had copies available for Members if required. 

                        The Chief Executive highlighted the underspend of Out of County Placements which was due to positive management of the placements as identified by the Head of Finance.  The issue was still reported as a risk as the effect of future placements was unknown. 

                        Councillor P.G. Heesom expressed concern at the build up of underspends, which was a change in philosophy from the previous administration, and also at the carry forward request for Housing Services (Homelessness).  Councillor N.R. Steele-Mortimer commented on the successful work undertaken on Out of County Placements which had resulted in the underspend.  He asked whether the Chief Executive felt that the improved position meant that all of the needs could be catered for in-county.  The Chief Executive responded that Out of County Placements was one of the most significant in year budget shifts and was partly due to investment in special schools, challenging the need to use placements not in county and working with those who provided the services to get a better deal.  He spoke of the need to provide more regional solutions and more general longer term solutions but added that he was confident that the process had left the authority with a more manageable budget.

                        The Leader of the Council responded to the comments by Councillor Heesom and said that the current years budget had been set in March 2012 and had crossed two council administrations.  It was important to protect core key services and the opportunity to use monies from the reserves for the MMI challenge would ensure that the authority was prepared should the payment need to be made.  On the issue of Out of County Placements, he said that recognition had to be given for the work which had been undertaken which was welcomed.  The carry forward for Homelessness was for the known cost for additional staff to provide additional resource to the existing staff in dealing with the impacts of Welfare Reform and had been discussed by the Welfare Reform Board.  The Chief Executive reminded Members that the Contingency Reserve was a figure which was separate from the base level figure of £5.476m.  He said that homelessness would be prioritised as it was a statutory duty on the authority but was a significant pressure as the amount which could be required was unknown. 

                        The Cabinet Member for Corporate Management understood the concerns raised but said that the full impact of the Welfare Reform was not yet known and that the authority could not return to the days of significant bed and breakfast spends of the past. 

                        In response to a question from Councillor R.G. Hampson on funding for special schools, the Chief Executive said that extra provision for special schools had been included in the draft budget and that this would continue to be a priority. 

                        Councillor P.J. Curtis suggested that landlords should be encouraged to reduce the costs of rental properties to alleviate some of the problems which would arise from the Welfare Reform changes.  The Chief Executive said that the authority was as prepared as it could be but that it had been a national government decision to undertake the reform and that the risk had not been created by local authorities. 

                        Councillor M. Bateman commented that there would also be additional pressure on the authority as a result of the health reforms proposed by Betsi Cadwaladr University Health Board. 

                        In response to the comments made, the Leader of the Council said that it was important to map out the impact on local people and local need of the changes proposed by the Welfare Reform and the pressures being put on Council Tax payers. 

                        Councillor A. Woolley asked whether the impact of the ‘bedroom tax’ had been considered, and highlighted in particular the number of people who could be affected by the changes but would not be able to move, even though they wanted to, as the Council did not have the appropriate size of property available.  The Leader of the Council responded that the issue of the allocations policy had been raised by the Welfare Reform Board and that a national debate was required on the issue.  He added that it was interlinked with the Discretionary Housing Payment Policy report which was to be considered as the next item on this agenda.  The Chief Executive explained that there had been a change in benefits but no changes on the issue of housing supply.  He said that a Fair Debt Policy was being developed.  The Head of Finance explained that a report on the policy would be submitted to the March 2013 meeting of the Committee. 

                        In response to a question from Councillor G.H. Bateman on the pressure of £0.042m relating to additional audit days, the Head of Finance said that it was due to the amount of days spent on a complex investigation.  The Chief Executive said that he had sanctioned the extra expenditure and had discussed it with the Chair and Vice-Chair of the Audit Committee.  It had also been the subject of a specific recommendation from the Audit Committee.     

            RESOLVED:

            That the report be noted.