Report of the County Treasurer (CT/19/45) on the Revenue and Capital Budget Outturn position for 2018/2019. The Report is attached as a supplement.
(Councillors Connett, Hannaford and Whitton attended in accordance with Standing Order 25(2) and spoke to this item).
The Cabinet considered the Report of the County Treasurer (CT/19/45) circulated prior to the meeting in accordance with regulation 7(4) of the Local Authorities (Executive Arrangements) (Meetings and Access to Information) (England) Regulations 2012 on the outturn position for 2017/2018.
The Cabinet noted that Members had received regular budget monitoring reports throughout 2018/19 in which budget pressures and risks had been identified, the most significant relating to Children’s Services, with overspending steadily increasing to £12.0 millions at month ten (January 2019). With a package of measures proposed, Cabinet (in November 2019) agreed the proposed measures to offset the overspending. In March 2019, the overall position was back in balance and the year-end position now forecast to break-even.
The overspending in Children’s services was £9.8 millions and the overall authority position, after transfers to and from Reserves, was a small underspend of £63,000. Detailed explanations of the final financial position for each service area were given in section two of this Report, but high level details included:
· Adult Care and Health Services - overall net underspend of £686,000 after taking into account carry forward requests;
· Children’s Services - overspend of £9.8 millions;
· Communities, Public Health, Environment and Prosperity - overall underspend of £1.7 millions after taking into account grants and contributions carry forward and other carry forward requests;
· Corporate Services - overall underspend of £590,000 after taking into account grants and contributions carry forward and any other carry forward requests; and
· Highways and Traffic Management - underspend of £2.4 millions generated, largely through a focus on long-term preventative works that had been funded from the capital programme.
The Report further outlined the position with the Better Care Fund, General Balances and Earmarked Reserves.
Cabinet also noted that the Council along with the other Devon authorities, was selected by Government to join its Business Rate Pilot for that year. This enabled £11.6 millions to be made available for invest to save initiatives within Children’s Services. These would be implemented over a four-year timescale and whilst £11.5 millions remained unspent, it had been transferred to a dedicated Earmarked Reserve for future years.
The change to the Minimum Revenue Provision policy agreed by County Council in February had, as planned, delivered a saving of just under £4 millions. Also, a review of the Balance Sheet enabled just under £3 millions to be released from the Financial Instruments Account to the revenue account. This, along with the late notification by Government of its intention to release the Business Rates Levy surplus in 2018/19 enabled £8.2 millions to be added to the Budget Management Reserve.
The mild and storm-free winter meant that the Bellwin emergency budget was not required and £250,000 had been used to create a Climate Change Emergency Reserve and the balance added to the Emergency Reserve to enhance resilience to future events. Details of the overall Reserves position were contained in section five of this Report and the table on page 8.
The Cabinet Member concluded that 2018/19 had been a particularly challenging year for the authority but the final year end position was welcome. The authority's Earmarked Reserves had increased by £25.2 millions, although £18.1 millions was in relation to the Business Rates Pilot (£6.6 millions to manage future risk and £11.5 millions for future invest to save initiatives within Children's Services). The increase in Reserves would help put the authority in a stronger position to deal with the uncertainty that remained around future funding, Brexit and ongoing pressures in Social Care.
The Cabinet placed on record its thanks to the Treasurer and her department for their work in delivering this Outturn Report.
The matter having been debated and the options and/or alternatives and other relevant factors (e.g. financial, sustainability, carbon impact, risk management, equality and legal considerations and Public Health impact) set out in the County Treasurers Report and/or referred to above having been considered:
it was MOVED by Councillor Barker, SECONDED by Councillor Hart, and
(a) that Members note that the draft outturn for 2018/19, after carry forwards and contributions to balances, reserves and provisions, shows an underspend of £63,000 against the approved revenue budget;
(b) that the 2018/19 revenue outturn be approved, including transactions on earmarked reserves and provisions, spending against budget, treatment of over and under spending and the implications for balances, as set out in the tables and the narrative of the Report;
(c) that the 2018/19 capital outturn be approved including spending against budget and proposed carry forwards, in accordance with the tables;
(d) that the use of capital finance as set out in the Determination of Capital Finance section 11 of the Report be approved;
(e) that a total of £15.0 millions is set aside from revenue resources as Minimum Revenue Provision (provision for credit liabilities to repay debt);
(f) that the Prudential Indicators as set out in section 10 of this Report be noted; and
(g) that the total monies owing to the Council as at 31st March 2019 be noted.