The Director of Finance will submit a report (Document “AC”) which provides Members with an overview of the forecast financial position of the Council for 2016-17 and a mid year performance report.

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. 

Recommended –

That the Executive

(1)       Approve the actions being taken in departments to mitigate the forecast overspend.

(2)       Approve the following capital expenditure schemes:

• £16.9m to fund a 69 apartment Extra Care Facility and 50 bed residential care home on the site of the former Bronte School in Keighley in line with Great Place to Grow Old Strategy. The scheme to be funded by £4.3m of grants, £4.5m of borrowing that will be funded by Rental income and £8.1m from the Great Places to Grow Old budget already approved within the Capital Investment Plan.

• £1.68m for Hard Ings road improvements to improve traffic flow and reduce congestion in Keighley. The scheme to be funded by short term borrowing prior to reimbursement from the West Yorkshire Transport Fund.

• £3.5m for Harrogate Road/New Liine Junction road improvement scheme, to be funded by £1.9m of developers contribution and £1.6m of short term borrowing prior to reimbursement from the West Yorkshire Transport Fund.

• £0.3m for Chellow Dene Reservoir repair to be funded from capital contingency.
• £1.6m for Street Lighting invest to save to be funded from the revenue budget savings from lower energy costs and lower maintenance.

• The Executive is asked to approve the use of the General Contingency on schemes that generate a net surplus.

Overview and Scrutiny Committee: Corporate

                                                                        (Andrew Cross – 01274 436823)

The Director of Finance submitted a report (Document “AC”) which provided Members with an overview of the forecast financial position of the Council for 2016-17 and a mid year performance report.

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 Director stated that the report set out the mid point assessment of the Council’s finances as well as the performance data pertaining to individual service areas.

In relation to performance, the Interim Assistant Director Policy, Programmes and Change explained that the new District Plan and Council Plan had been now been approved and new indicator sets will be developed and measured against those plans in the future.  Hence this report set out performance in key areas around better skills; good schools; better health; better lives; decent homes and a safe clean and active communities.  She added that where there were performance issues, Strategic Directors and Assistant Directors were addressing them within their respective service areas.

The Leader acknowledged good performance across service areas and commended staff in their work.

The Health and Wellbeing Portfolio Holder highlighted the excellent performance in Adult Social Care. She also expressed a word of caution in relation to young people leaving care and who were living in unsuitable accommodation,  stressing that some young people despite the best efforts of the service, were opting to live in unsuitable accommodation and therefore the figures did not reflect the reality of the situation.

The Chief Executive stated that the Council had received national recognition in a number of areas such as the work undertaken by the Mental Health Crisis team, the Events Team, as well as the city winning the curry capital for the 6^th consecutive year.

In relation to the mid year financial position, the Director of Finance stated that the report detailed the financial pressures facing the Council and that he was posting a £6.0m overspend at this mid year stage.  The primary overspend was within Adult Social Care and Children’s Social Care.  He stressed that Bradford was not alone in facing these pressures as many authorities were struggling to contain the cost of social care.

The Director alluded to the measures put in place to address the overspend, including requesting all Strategic Directors and Assistant Directors to improve the budget position in their respective service areas. 

The Director explained the reserves position which currently stood at £13.8m in corporate reserves, which was a small cushion on the context of the financial pressures and risks facing the Council.

The Director also drew attention to the lower than budgeted Business Rates collection, which on current forecast was £2.5m less than budgeted.

In relation to a question on Business Rates collection rates, the Director confirmed that the Valuations Office set the level of business rates and successful appeals meant the Council could never accurately predict the amounts that could be collected.

The Health and Wellbeing Portfolio Holder stated that the financial pressures facing Adult Social Care was a national issue and that the Local Government Association was aware of the situation and actively pursuing the issue with Government. She added that although the Council accepted the 2% precept for Adult Social Care, the amounts raised were insufficient to meet the shortfall.

In relation to Children’s Social Care the Portfolio Holder explained that the reducing number of children in care had not materialised and that the 2016/17 budget was predicated on this assumption, however efforts were on going to try and minimise costs.

The Leader expressed her sincere thanks to officers who were working hard to contain costs within their respective departments and service areas.

Resolved –

(1)       That the actions being taken in departments to mitigate the forecast overspend be approved.

(2)       That the following capital expenditure schemes be approved:

• £16.9m to fund a 69 apartment Extra Care Facility and 50 bed residential care home on the site of the former Bronte School in Keighley in line with the Great Places to Grow Old Strategy. The scheme to be funded by £4.3m of grants, £4.5m of borrowing that will be funded by Rental income and £8.1m from the Great Places to Grow Old budget already approved within the Capital Investment Plan.

• £1.68m for Hard Ings Road improvements to improve traffic flow and reduce congestion in Keighley. The scheme to be funded by short term borrowing prior to reimbursement from the West Yorkshire Transport Fund.

• £3.5m for Harrogate Road/New Line Junction Road improvement scheme, to be funded by £1.9m of developers contribution and £1.6m of short term borrowing prior to reimbursement from the West Yorkshire Transport Fund.

• £0.3m for Chellow Dene Reservoir repair to be funded from capital contingency.

• £1.6m for Street Lighting invest to save to be funded from the revenue budget savings from lower energy costs and lower maintenance.

• That the use of the General Contingency on schemes that generate a net surplus be approved.

ACTION: Director of Finance

Overview and Scrutiny Committee: Corporate