Agenda item

Report of the Director of Finance and Public Value (DFP/24/56) presenting the outturn for 2023/2024. This Report will follow.

RESOLVED

(a) that the key Operating Principles of the Authority to deliver financial sustainability and continue to support the priority focus on improving financial management, control, accountability and capability across services be noted;

(b) that the draft outturn for 2023/24 be noted, after carry forwards and contributions to and from balances, reserves and provisions, shows an increase in the General Fund Balance of £55,000 against the approved revenue budget;

(c) that the 2023/24 revenue outturn is 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;

(d) that any variances in the final returns from Districts for business rates grants and pooling gain be taken to the Business Rates Risk Management Reserve;

(e) that the 2023/24 capital outturn is approved including spending against budget and proposed carry forwards, in accordance with the tables;

(f) that the use of capital finance as set out in the Determination of Capital Finance section 11 of the report is approved;

(g) that a total of £9.8 million is set aside from revenue resources as Minimum Revenue Provision for the repayment of capital borrowing;

(h) that the Prudential Indicators, as set out in section 10 of the Report, be noted;

(i) that the total monies owing to the Council, as at 31st March 2024, be noted; and

(j) that the Finance and Public Value Directorate be thanked for their exceptional work, under pressure and with strict deadlines, in delivering the outturn report.

(Councillors Biederman, Dewhirst, Whitton and Wrigley attended in accordance with Standing Order 25(2) and spoke to this item).

The Cabinet considered the Report of the Director of Finance and Public Value (DFP/24/56) which presented the outturn for 2023/2024.

They noted that a key Operating Principle was to strengthen the financial sustainability and resilience and continue to drive forward cultural change to improve accountability and control for delivering agreed financial targets and building collaboration and partnerships.

The Report highlighted that overall, the Authority had performed well financially this year and had achieved a balanced outturn position.

One of the key priorities during the year had been to tackle the increasing deficit position relating to Special Educational Needs and Disabilities (SEND). Effective partnership working and negotiation with the Department for Education (DfE) had led to significant additional funding through the Government’s Safety Valve Programme. This had enabled a strong financial intervention that reversed the trend of a growing deficit. More detail was provided in Section 5.2.

The Month 10 forecast reported to Cabinet in March had been a breakeven position and at outturn, after carry forwards and transfers to and from reserves there was a small increase in the General Fund balance of £55,000 in 2023/24 on a net Budget of £607.7 million. This was a significant improvement on the £13.6 million forecast overspend at Month 6. This result reflects the strong focus of the Authority’s strategic and leadership teams, Cabinet and Scrutiny, with extensive support from Finance, on meeting budget targets and maintaining the financial strategy of living within our means. There had also been a one-off £8 million windfall through the Connecting Devon and Somerset broadband contract clawback income, and additional grant funding awarded in year for Adult Social Care.

The indicative underspend position at the end of the year was £5.2 million which had enabled the Authority to fund an increase in the provision for non-recovery of income (bad debt) by £931,000, an additional £1.2 million contribution to the cumulative DSG SEND Deficit on top of the £10 million previously planned, a carry forward of £2 million to support additional highways maintenance and drainage to help prevent potholes, and a transfer of £1.1 million to earmarked reserves to further support ongoing financial sustainability including modernisation and improvement in services.

The General Fund balance had been maintained at £16 million and earmarked reserves, excluding schools and non-schools carry forwards, had been maintained at just over £101 million after a net reduction of £6.5 million to support planned costs in the year.

Within services there were overspends reported primarily to the budgets for Integrated Adult Social Care and to Children and Young People's Futures. For the 2023/24 Budget, significant investment had been made to enable improvement in Children’s and Young People’s Futures services.

Investment in road infrastructure remains a pressure with total spend on highways safety defects (‘potholes’) reaching £9.3 million of which £1.8 million had been allocated to the capital programme through changing the capitalisation policy. The resulting £7.5 million exceeded the budget by £3.8 million. In a separate Report the Cabinet had been asked (May 2024) to increase the 2024/25 capital programme by £10 million to accelerate improvements in road infrastructure quality..

Detailed explanations of the final financial position for each service area were given in section 2 of the Report, but in summary;

The outturn position for the Integrated Adult Social Care service is an overspend of £2.4 million (0.7%). The overall position for Children’s and Young People's Futures was an overspend of £7.6 million (3.7%) against the final Budget of £207.4 million, which excluded the Dedicated Schools Grant funding and activity. The final Budget for Public Health, Communities and Prosperity was £32.9 million, and the outturn position showed an overall underspend of £1.5 million (4.5%). For Corporate Services (Legal and Democratic, People and Culture, Finance and Public Value and Digital Transformation and Business Support), the final 2023/24 Budget was £45.8 million with a net overall underspend of £990,000 (2.1%). The position for Climate Change, Environment and Transport after carry forward requests was an underspend of £1.7 million.

In summary, the Authority had operated within budget overall, maintained adequate reserves, reduced the DSG deficit and reduced the total level of external borrowing, all factors that made a positive contribution to managing financial risk and performance and meeting the financial sustainability priority.

Other influencing factors included the overall cost of the national staff pay award for 2023/24 which had been £1.7 million more than the budget estimate in February 2023 and a number of other issues were highlighted in section 2.30 - 2.42).

The Better Care Fund (BCF), which was a pooled budget between the NHS Integrated Care Board and the Authority, for 2023/24 was reporting an overspend of £1.8 million (1.4%). The table on page 23 of the Report gave further detail. 

The matter having been debated and the other relevant factors as set out in the Director’s Report having been considered:

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

RESOLVED

(a) that the key Operating Principles of the Authority to deliver financial sustainability and continue to support the priority focus on improving financial management, control, accountability and capability across services be noted;

(b) that the draft outturn for 2023/24 be noted, after carry forwards and contributions to and from balances, reserves and provisions, shows an increase in the General Fund Balance of £55,000 against the approved revenue budget;

(c) that the 2023/24 revenue outturn is 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;

(d) that any variances in the final returns from Districts for business rates grants and pooling gain be taken to the Business Rates Risk Management Reserve;

(e) that the 2023/24 capital outturn is approved including spending against budget and proposed carry forwards, in accordance with the tables;

(f) that the use of capital finance as set out in the Determination of Capital Finance section 11 of the report is approved;

(g) that a total of £9.8 million is set aside from revenue resources as Minimum Revenue Provision for the repayment of capital borrowing;

(h) that the Prudential Indicators, as set out in section 10 of the Report, be noted;  

(i) that the total monies owing to the Council, as at 31st March 2024, be noted; and

(j) that the Finance and Public Value Directorate be thanked for their exceptional work, under pressure and with strict deadlines, in delivering the outturn report.