Agenda item - Targeted Budget Management (TBM) 2017/18: Month 5

Report of the Executive Director for Finance & Resources (copy attached).

1)           That the Committee note the forecast risk position for the General Fund, which indicates a budget pressure of £1.678m. This includes a forecast overspend of £0.088m on the council’s share of the NHS managed Section 75 services.

2)           That the committee approve one-off funding of the additional cost of Communal Bin rounds of £0.050m detailed in Appendix 3 under City Environmental Services from the council’s available risk provision of £1.500m.

3)           That the Committee note, subject to approval of recommendation 2.2 above, that total recurrent and one-off risk provisions of £1.450m are available to mitigate the forecast General Fund risk if the risks cannot be completely eliminated by year-end.

4)           That the Committee note the forecast for the Housing Revenue Account (HRA), which is an underspend of £0.490m.

5)           That the Committee note the forecast risk position for the Dedicated Schools Grant which is an overspend of £0.422m.

6)           That the Committee note the forecast outturn position on the capital programme and approve the variations and slippage in Appendix 5.

7)           That the Committee agree to release the 2018/19 contingency of £0.079m within the Welfare Reform Reserve to support the Local Discretionary Social Fund in 2017/18 if required (para 6.3).

43.1      The Committee considered a report of the Executive Director, Finance & Resources in relation to Targeted Budget Management (TBM) 2017/18 Month 5. The report set out an early indication of forecast risks as at Month 5 on the council’s revenue and capital budgets for the financial year 2017/18.

43.2      Councillor Sykes expressed his concern regarding the rise in unachieved savings of £1m since TBM 4 and asked for assurance that the Finance & Resources and Environment & Economy directorates would not be asked to meet the pressures from demand led services. Referring to paragraph 3.8, Councillor Sykes noted that there was a forecast overspend on Temporary Accommodation of £0.170m and expressed his concern that changes in approach toward anti-social behaviour by the council’s private contractor for the service may have been a contributory factor in the rise.  Councillor Sykes asked for clarification on the figures at paragraph 3.20 on the Collection Fund. Whilst a surplus of £2.35m was welcomed, there had been a reduction in Council Tax Reduction (CTR) awards and an increased in Severely Mentally Impaired (SMI) awards and asked for assurance that one was not simply balancing out the other.

43.3      The Executive Director, Finance & Resources replied that there was a very detailed savings plan and some of those savings were proving difficult to achieve, particularly with the demand led services. Where those savings were not being achieved, recovery plans were in place. The savings made in the Environment & Economy and Finance & Resource directorates were good news and he could provide assurance that they would not be used to compensate overspends in other areas. The Executive Director, Finance & Resources stated that the overspend in Temporary Accommodation and any contributing factors would be looked at in detail.  The Executive Director, Neighbourhoods, Communities & Housing added that the council was currently in the process of appointing Welfare Support Officers to work with those in Temporary Accommodation with a focus on maintaining tenancies. The Head of Finance stated that SMI awards had increased and were projected to continue to with portion of that rise attributable to a concentrated awareness campaign and assured councillor Sykes that there was no cross subsidy between that SMI awards and CTR awards.

43.4      Councillor Sykes asked if for the status of the council’s various Discretionary Funds. Referring to page 47 of the report, Councillor Sykes stated that he would query whether the movement of £50,000 and £60,000 should be interpreted as minor and he hoped more detail on that movement could be provided in future reports. Furthermore, Councillor Sykes asked for confirmation that the Library Service savings were on track as reports to the Modernisation Board had suggest they were not.

43.5      The Executive Director, Finance & Resources replied that a status report on the council’s Discretionary Funds could be provided to all three political groups, that the more detail on budget movements could be provided in future reports and the reporting threshold lowered. The Executive Director, Finance & Resources clarified that the Library Service savings were on track and the report to the Modernisation Board related to a specific capital project.

43.6      Councillor Wealls stated that he was mindful of the TBM 2 report considered by the committee at its previous meeting where his Group had proposed a motion setting aside a £640,000 contingency fund for any overspend and the committee were now discussing an overspend £280,000 in excess of risk provision. Councillor Wealls requested a vote be taken on recommendation 2.2 as he did not believe sufficient information had been provided to support the allocation of one-off funding. Councillor Wealls stated that no information had been provided in relation to the progress made toward Cityclean meeting competitor budgets and the roll out of communal refuse collection had been intended to reduce rather than increase costs.

43.7      Councillor Mitchell stated that the one-off funding detailed at recommendation 2.2 was to staff a third communal refuse vehicle and was entirely justified. Councillor Mitchell stated that the city’s population was growing placing a greater pressure on core services and it was the council’s duty to provide a good, reliable service to its residents.

43.8      Referring to page 34 of the agenda, Councillor Hamilton noted that in each of the previous three years, the forecast overspend had reduced through the year and there was no reason to believe that would not be case this financial year.

43.9      Councillor Wealls stated that he hoped any anticipated growth would be taken into account during budget setting to ensure financial prudence. In response to the point made by Councillor Hamilton, Councillor Wealls stated that similar arguments had been made ahead of financial crashes.

43.10   In reference to recommendation 2.2, Councillor Sykes stated that the sum was minor relative to the benefit it would be bring and he would be agreeing to the request. Councillor Sykes noted that together with the details mentioned in his earlier written question and the information detailed on page 60 and page 67 of the agenda, his Group had protected £2.25m of services in this and the previous financial year.

43.11   Councillor Yates noted that whilst the Green Group had moved various motions at Budget Council, they had ultimately voted against the wider budget for 2017/18. Councillor Yates added that he was aware that Councillor Wealls had made several public complaints about the standard of refuse collection so he was surprised that he did not welcome increased investment.

43.12   Councillor Janio stated that previous years demonstrated that a budget overspend declined as the year progressed and he was very concerned that overspend had increased from TBM Month 2 to TBM Month 5. Councillor Janio added that having prudent financial reserve, as his Group had proposed, was the sensible approach.

43.13   RESOLVED-

1)           That the Committee note the forecast risk position for the General Fund, which indicates a budget pressure of £1.678m. This includes a forecast overspend of £0.088m on the council’s share of the NHS managed Section 75 services.

2)           That the committee approve one-off funding of the additional cost of Communal Bin rounds of £0.050m detailed in Appendix 3 under City Environmental Services from the council’s available risk provision of £1.500m.

3)           That the Committee note, subject to approval of recommendation 2.2 above, that total recurrent and one-off risk provisions of £1.450m are available to mitigate the forecast General Fund risk if the risks cannot be completely eliminated by year-end.

4)           That the Committee note the forecast for the Housing Revenue Account (HRA), which is an underspend of £0.490m.

5)           That the Committee note the forecast risk position for the Dedicated Schools Grant which is an overspend of £0.422m.

6)           That the Committee note the forecast outturn position on the capital programme and approve the variations and slippage in Appendix 5.

7)           That the Committee agree to release the 2018/19 contingency of £0.079m within the Welfare Reform Reserve to support the Local Discretionary Social Fund in 2017/18 if required (para 6.3).