The report of the Director of Finance (Document “BK”) provides Members with an update on the forecast year-end financial position of the Council for 2021-22.

It examines the latest spend against revenue and capital budgets and the forecast year-end financial position based on information at the end of February 2022. It states the Council’s current balances and reserves and school balances. 

Recommended -

That the Executive

(1)       Note the contents of this report and the actions taken to manage the issues highlighted.

(2)       Approve the following capital expenditure schemes as outlined in section 14.9.

·         £0.33m additional budget to complete the relocation of the Central Processing Unit to Mitre Court. This overspend will be funded by an additional corporate capital receipts and underspends on corporate property schemes.

Note the following has been approved under Section 1.7 of the Financial Regulations:

·         £3.3m for additional investment in BACES. The budget is currently included in Reserve Schemes.

(Andrew Cross – 07870 386523)

The report of the Director of Finance (Document “BK”) provided Members with an update on the forecast year-end financial position of the Council for 2021-22.

It examined the latest spend against revenue and capital budgets and the forecasted year-end financial position based on information at the end of February 2022. It stated the Council’s current balances and reserves and school balances. 

Based on a projection at February the 28th 2022, the Council was forecasted to overspend the £385.4m net revenue budget by £3.2m by March 31^st 2022. This is after taking account of the c£27m of Covid related funding that’s been carried forward from 2020-21, and c£58m of additional Covid related funding that is expected to be received in 2021-22.

The forecast overspend contained significant variances in a number of service areas, most notably agency staffing costs and increased Child Looked After Placements in Children’s Services, both of which have increased significantly in recent years. The forecast overspend is after the £7.1m increase in budget that was approved at Budget Council in February 2021, and the allocation of significant amounts of Covid related funding.

The Council wide forecast overspend has remained the same as Qtr 3, however, there has been a £2.5m increased in the forecast overspend in Children’s Services, offset by an equivalent improvement in other areas. 

The forecast Council overspend is a best estimate of the 2021-22 year-end position based on current trajectories, and although it is late in the financial year there remains a number of uncertainties that could impact on the final year end position.

The Leader enquired how the pandemic would impact on the Council’s finances going forward.  In response it was stated that a number of income streams would still be affected, including car parking revenue as well as other fees and charges across a number of service areas; the increase in the cost of looked after placements and in the areas of waste was another area of concern.

The Leader stressed that the impact of the pandemic would be felt long into the future, and that Government had not indicated that they would cover these additional costs.

The Leader added that it had been a very difficult year for the Council, as Social Care pressures remained acute in the face of high demand; mental health services also needed bolstering in the context of increased demand.  In relation to Children’s Social Care the overspend was similar to that of other Local Authorities up and down the country.

The Health and Wellbeing Portfolio Holder thanked the Finance Team for the work done on the budget.  She highlighted that the number of people accessing Adult Social Care was increasing across a number of age groups.  The pressure on services was acute however the focus remained in supporting, where possible, people in their own homes, and it was important that Government adequately funded Adult Social Care.

A Main Opposition Group Councillor was present at the meeting and expressed his concerns at the continuing cost pressures in Children’s Social Care and what mitigations measures were being looked at to stabilise the situation going forward.  In response it was stated that although there was the prospect of increased costs in the context of increasing demand, there was a concerted effort to look at individual cases to see which cases could be closed, as well as looking at a raft of other measures in order to manage the budget.

The Leader stated that the ongoing pressures in Social Care and future funding was a national issue that Government needed to address.

Resolved -

(1)       That the contents of Document “BK” and the actions taken to manage the issues highlighted be noted.

(2)       That the following capital expenditure schemes as outlined in section 14.9 to Document “BK” be approved:

·         £0.33m additional budget to complete the relocation of the Central Processing Unit to Mitre Court. This overspend will be funded by an additional corporate capital receipts and underspends on corporate property schemes.

Note that the following has been approved under Section 1.7 of the Financial Regulations:

·         £3.3m for additional investment in BACES. The budget is currently included in Reserve Schemes.

ACTION: Director of Finance