Agenda item

            That the reports be noted.  

            Revenue Budget Monitoring 2014/15 (Month 4)

                        The Chief Officer (People and Resources) introduced a report to provide Members with the latest Revenue Budget Monitoring 2014/15 (Month 4) for the Council Fund and Housing Revenue Account which was to be submitted to Cabinet on 16 October 2014. 

                        For the Council Fund, the projected net in year non pay expenditure was forecast to be £0.019m lower than budget.  Extensive work had been undertaken to rebase all workforce budgets to reflect the actual new costs arising from the new pay and grading structure following the implementation of Single Status.  Due to the continuation of this significant piece of work, no pay variations were included in the report.  It was anticipated that the rebasing work would be concluded in time for the next monitoring report. 

The variances of £0.622m between months 3 and 4 were detailed in appendix 1 and consisted of an overall net reduction in Social Services, an increase in the anticipated surplus on the Council Tax Collection Fund and variances totalling £0.241m in Central and Corporate Finance.  Section 3.05 detailed the efficiencies and it was currently projected that £8.444m of the £8.84m (96%) would be achieved.  It was reported in paragraph 3.06 that a significant efficiency was included within the Functional Value for Money targets for the administrative support across the organisation.  This was subject to further review and though currently assumed as achievable, it remained an additional risk.  The 2014/15 budget also contained £3.1m of workforce efficiencies.  The Chief Officer (People and Resources) explained that an initial Voluntary Redundancy Programme had identified a number of efficiencies and a second programme had commenced on 1 September 2014 and was running alongside the next phase of the Management Review.  A full analysis was included in appendix 3. 

                        Section 4 detailed the inflation included in the budget and section 5 included the budget assumptions and risks.  It was reported that taking into account amounts needed to be used from the unearmarked reserves and the current projected outturn at month 4, the projected balance on the contingency reserve at 31 March 2015 was £2.960m and this was summarised in appendix 4. 

                        The HRA was projected to have an overall underspend of £0.038m and a projected closing balance at Month 4 of £1.203m which at 4% of total expenditure satisfied the prudent approach of ensuring a minimum level of 3%. 

                        Councillor Richard Jones referred to the changes in the way the Budget Monitoring information had been reported which included much less detail in the  table for the Council Fund latest forecast.  Earlier reports had included the original budget which this report did not.  He also said that non-pay expenditure had not been included as a risk for this period which he felt was a concern and he asked that both of these elements be included in future reports to allow for transparency and easier understanding.  The Chair commented that the detail was included in appendix 1 to the report.  Councillor Jones also felt that the overspend in services could not be scrutinised using the current reporting methods and suggested that a zero based budget be considered.  He sought clarification on the risk of the monthly costs of £0.030m for the former Euticals site and asked why this was different to the variance of £0.286m reported in appendix 1 on page 28.  He referred to the Outcome Agreement Grant and Single person discount review which had been identified as risks at Month 3 but had not been included in this report and suggested that an explanation should be provided as to why they were no longer showing as risks. 

                        The Chief Officer (People and Resources) accepted the comment from Councillor Jones about the risk of non-pay expenditure.  She explained that further work was needed to complete the rebasing work and said  that risks had been identified, and were being managed, in relation to the amount set aside for Single Status both for the increase in the pay bill and for the one off costs (for example, pay protection and implementation payments). With reference to the level of detail provided in budget monitoring reports for Members, she added that it was important to achieve the appropriate balance between the detail required by Cabinet and by this Committee to enable both to undertake their respective roles.  She referred to a piece of software called Collaborative Planning that would allow officers to provide budget monitoring information in a variety of different formats to more easily meet data requirements. The Finance Manager said that there was no reason why the amount of the original budget could not be included in future reports.  On the issue of Euticals, she explained that the £0.030m was the monthly costs and that the amount of £0.286m was the movement in the projection from Month 3 to 4 due to the fact that the running costs had now been forecast to year end.  She said that she would consider including detail on risks which had been removed in future reports and that further information on the Single Person Discount could be provided following the meeting. 

                        The Leader accepted the views of Councillor Jones about the ongoing reporting of risks which had been removed but said that even though figures were now reported based on portfolios rather than directorates, the budget amount remained the same, which he felt should be welcomed.  He added that the projected underspend at month 4 of £0.019m compared to a projected overspend of £0.603m at month 3 was positive. 

                        On the Housing Revenue Account (HRA), Councillor Ron Hampson indicated that those who had been charged for the gardening service when they should not have been, had not yet received a refund.  The Chief Officer (People and Resources) agreed to provide an update following the meeting. 

                        Councillor Robin Guest felt that it was essential that Members could understand how the budgets had been realigned to portfolios instead of directorates.  He also felt that there was a need to identify the detail of the original budget and to provide information on the movements and variances beneath each portfolio to allow Members to scrutinise the budget. 

The Leader took the comments on board and said that it was important that Members had adequate information to allow them to challenge the figures.  The Chief Officer (Governance) explained that each service area had a significant number of budget codes for different transactions and that it was important to provide a balance between providing too little or too much information. 

Councillor Jones suggested that the reports should include the original budget, the amount for the current month and the proposed figures for the remainder of the financial year.  The Leader raised concern at the insinuation of the lack of transparency in the budget monitoring reports and suggested that a meeting be arranged with himself, the Chair of the Committee, Councillors Jones and Guest and the Chief Officer (People and Resources) to discuss the format of budget monitoring reports.  The Chair proposed the suggestion and it was duly seconded. 

The Chair raised concern at the budget for Streetscene and Transportation and the impact on the rest of the service if the overspend in waste services continued to increase. 

Councillor Jones also sought clarification on the variance of £0.404m for Social Services for Adults – Locality Teams (Localities).  The Leader responded that the increase in demand should be considered by the Social and Health Care Overview & Scrutiny Committee and the Member Engagement Manager confirmed that performance reporting, which would include this issue, was to be submitted to the November 2014 meeting of that Committee.  Councillor Jones also referred to the resolution on minute number 27 on page 12 of the agenda.    

In response to a question from the Chair about work as a result of the Early Voluntary Redundancy programme, the Chief Officer (People and Resources) said that it was anticipated that the changes on work allocation and job redesign would be minor and would not need to be submitted to this Committee.    

            RESOLVED:

            That the report be noted.

            Capital Programme (Month 4)

                        The Chief Officer (People and Resources) introduced a report to provide Members with the Month 4 capital programme information for 2014/15 which would also be submitted to Cabinet on 16 October 2014.

                        The table at paragraph 3.01.1 set out how the programme had changed during 2014/15 with the revised figure being £31.234 for Council Fund and £12.636 for HRA and full details were provided in appendix A.  The capital expenditure compared to budget was detailed in paragraph 3.04 and showed an underspend of £0.122m.  The rollover into 2015/16 was reported in paragraph 3.05.2 and detailed in Appendix B.  The financing of the programme was summarised and it was reported that the element of the Council Fund total financed from general (non-specific) financing resources, relied in part on the generation of capital receipts from asset disposal. There was a projected shortfall to 2015/16 of £0.843m and any capital receipts received would be used to reduce the shortfall.

            RESOLVED:

That the report be noted.