Local democracy

Agenda item

QTR. 4 FINANCE POSITION STATEMENT FOR 2018-19

provides Members with an overview of the forecast financial position of the Council for 2018-19.

 

It examines the latest spend against revenue and capital budgets and forecasts the financial position at the year end. It states the Council’s current balances and reserves and forecasts school balances for the year. 

 

The Director of Finance will submit a report (Document “AL”) which provides Members with an overview of the forecast financial position of the Council for 2018-19.

 

It examines the latest spend against revenue and capital budgets and forecasts the financial position at the year end. It states the Council’s current balances and reserves and forecasts school balances for the year. 

 

The report will be considered at the meeting of the Executive on 2 April 2019.

 

Recommended –

 

The Corporate Overview and Scrutiny Committee is being asked to review and comment on the Qtr 4 Finance Position Statement for 2018-19.

(Andrew Cross - 01274 436823)

Minutes:

The Director of Finance submitted a report (Document “AL”) which provided Members with an overview of the forecast financial position of the Council for 2018-19.

 

It examined the latest spend against revenue and capital budgets and forecasted the financial position at the year end. It stated the Council’s current balances and reserves and forecasted school balances for the year. 

 

The report was also considered at the meeting of the Executive on 2 April 2019.

 

Officers from the Department of Finance were present at the meeting to give an overview, during which it was stated that on a projection at 28th February 2019, the Council was forecasting to underspend the £358.1m net budget by £1.3m. Contained within the underspend there were however a number of significant variances to budget.  The overspends were principally in Adult and Children’s Social Care and within the Department of Place, the details of the overspend were contained in the report.

 

The reserves position was also alluded to along with the capital expenditure and the Council Tax and Business Rates collection rates.

 

During the discussion Members asked a number of questions, the questions together with the responses are detailed below.  A number of Strategic Directors and Assistant Directors were present at the meeting to give service specific response to Member’s questions:

 

A Member stated that in setting the budget and forecasting spend within the overall budget it was difficult for residents in the district to understand how the overall forecast between quarter 1 and quarter 4 was so out of sync.  In response it was explained that a number of significant factors around additional funding announcements and 1 off monies from Central Government were unknowns and these could only be factored into the budget when the allocations were made.  In addition resources that were allocated for redundancy payments were also fluid and resulted in a reduced spend as the anticipated level of redundancies’ failed to materialise, and in the end all the different facets of the budget were difficult to forecast, as they were predicated on so many variables.

 

In response a Member stated that the allocated and unallocated reserves position should be reviewed with a view to funding redundancy payments from the revenue budget. It was acknowledged that going forward the redundancy payments would be included as a separate budget item.

 

A Member expressed his concerns at the way the general fund was utilised in the context of an overspend /underspend.  In response it was clarified that the general fund covered amongst other things capital finance to repay interest loans as well as the West Yorkshire Transport and the West Yorkshire Combined Authority levy.

 

A Member stressed that it was important that we explained the budget to the wider public in layman’s terms.

 

A Member questioned the £3m overspend on the Bingley Music Live, stating that the weather and lower than anticipated tickets sales had been given as reasons for the overspend.  In response the Assistant Director Sports and Leisure stated that although the event was a success a number of factors had contributed to this overspend, which were around reduced tickets sales for the daytime events, although weekend sales tickets remained buoyant; in addition concessions were also down and less income was generated from food and drink sales as a consequence.  Due to the unavailability of some of the bands, other bands had to be procured at short notice, resulting in higher costs.  Staffing costs had also increased this year as a number of experienced staff familiar with the running of the event had left, and therefore additional staff had to be brought in at short notice,  as well as infrastructure costs escalating, as they had been procured later than envisaged.

 

As a result of the issues faced in hosting Bingley Live, a full review will be undertaken to establish all the facts and the options to consider in hosting the event in the future.

 

A Member expressed concern at the spiralling overspend at Hanson School which was now running at £4m, and there was a possibility that if the school sought Academy status, this liability would be transferred to the Local Authority and it was therefore imperative that as a Council we scrutinised this issue as a matter of urgency. In response the Interim Strategic Director Children’s Services stated that the Local Authority was working closely with Hanson School to address the issues facing the School and this support would continue to be provided going forward.

 

A Member queried the £600k overspend on staffing costs in Sports and Leisure and given the sums involved, how this was not factored into the overall budget for the Service.  He added that he had been circulated a briefing note following the same concerns he raised at a previous meeting and that it alluded to some staff being on zero hours contract.

 

In response the Assistant Director Sports and Leisure stated that the Service had been set income targets which had failed to materialised, and that historically there had been efforts to try and bring the budget back on track and the delivery of the new Sedbergh facility would achieve this. In relation to the issue of the zero hours contract, the Assistant Director stated that this was more about terminology, as the service was regularly using casuals to cover certain events as and when required.

 

A Member stated as a Council we had set ourselves income targets, however these had failed to materialised, and as a Council we should be realistic what we can achieve in this context.

 

Resolved –

 

(1)       That this Committee requests that a full and detailed report         dealing with the financial circumstances relating to the £4m        overspend in Hanson School be presented to this Committee    early in the new Municipal Year.

 

(2)       That this Committee requests that information clarifying the use            of zero contracted hours be circulated to Members.

 

ACTION:       Strategic Director Corporate Resources (2) / Interim                                   Strategic Director Children’s Services (1)

 

 

Supporting documents: