Agenda item

Report of the Director of Finance (DF/22/4) on the Budget Monitoring Position in the current financial year at Month 8 and giving an updated position on the Target Budget and Service Targets for 2022/2023, attached.

RESOLVED

(a) that the Month 8 budget monitoring forecast position be noted;

(b) that progress on the delivery of the Dedicated Schools Grant Management Plan be noted; and

(c) that the Provisional Settlement for 2022/23 also be noted.

(Councillors Biederman, Connett and Hannaford attended in accordance with Standing Order 25(2) and spoke to this item).

The Cabinet considered the Report of the Director of Finance (DF/22/4) on the Budget Monitoring Position in the current financial year at Month 8 and an updated position on the Target Budget and Service Targets for 2022/2023, 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.

At month 8 it was estimated that budgets would overspend by just over £8.3 million, an increase of £1.3 million from month 6. The Dedicated Schools Grant projected deficit, relating to Special Educational Needs and Disabilities (SEND), was forecast to be £39.0 million. In line with Department of Education guidance this deficit would not be dealt with this financial year but carried forward to future years.

Adult Care and Health Services were forecast to overspend by just over £5.1 million, a reduction of £71,000 from month 6 and the position included £3.2 million of budgeted savings.

Children’s Services were forecasting an overspend of £9.1 million, an increase of £1.8 million from month 6 (not including the projected deficit of £39.1 million on Special Education Needs and Disabilities (SEND)).

Highways, Infrastructure Development and Waste was forecasting an underspend of £290,000 an improvement of £76,000 from month 6, the result of additional overheads being funded from the highways permitting scheme.

Communities, Public Health, Environment and Prosperity (COPHEP) were forecasting an underspend of £1.5 million and Corporate Services were forecasting an underspend of £671,000, and small reduction of £13,000 from month 6. Non-service items, which included capital financing charges and business rates pooling gain, were forecast to underspend by £3.5 million.

The approved capital programme was £216.7 million, including amounts brought forward from 2020/21, and other prior year approvals, of £46.2 million, and in year additions of £23.1 million. The year-end forecast at Month 8 was £184.4 million with slippage forecast at £32.3 million. The main areas of net slippage could be attributed to scheme variations and programme delays in Planning, Transportation and Environment, which reflected the complexity of the major schemes within this service area.

In response to the COVID-19 outbreak the Government had continued to put in place a number of grant funding streams to help support Local Authorities in responding to the pandemic and the Council was in direct receipt of pandemic related grants with a confirmed value of £50.7 million. In addition to the funds received this year the Authority was able to carry forward £25.6 million of funding received last year, mainly related to Contain Outbreak Management Funding, Test and Trace Funding and the Covid Support Grant.

The Report outlined that on the 16 December 2021, the Secretary of State for the Department for Levelling Up, Housing and Communities (DLUHC), Rt. Hon. Michael Gove MP, released a written statement to Parliament on the provisional Local Government Finance Settlement 2022/23 which was for one year only and based on the Spending Review 2021 (SR21) funding levels.

The Chancellor had announced an additional £1.6bn per annum (2022/23 to 2024/25) for Local Government as part of SR21 and the majority of this amount had been included in the Core Spending Power figures.

Based on the figures in the Core Spending Power amounts, there had been a net increase in funding (excluding the multiplier adjustment and Adult Social Care reform funding) of £1.526bn. A breakdown of the change was shown in the Report.

The council tax referendum limit would be 2% for local authorities, with social care authorities allowed an additional 1% social care precept. No papers had been published relating to the Fair Funding Review or the Business Rates Reset.

The table in the Report set out Devon’s Core Funding of £103.2 million and shows the other grants that had been announced so far. Other grants were expected to be announced in the coming weeks and months

The provisional settlement had been very close to what was expected, and no change was therefore proposed to the Budget Targets for 2022/23 that had been agreed by Cabinet in December 2021.

Although the Provisional Settlement represented an increase to the Authority’s funding next year it was not sufficient to meet the demand and cost pressures being faced and savings would need to be made to balance the budget.

The matter having been debated and the options and/or alternatives and other relevant factors as set out in the Director of Finance’s Report and/or referred to above having been considered:

it was MOVED by Councillor Twiss, SECONDED by Councillor Hart, and

RESOLVED

(a) that the Month 8 budget monitoring forecast position be noted;

(b) that progress on the delivery of the Dedicated Schools Grant Management Plan be noted; and

(c) that the Provisional Settlement for 2022/23 also be noted.