Agenda item

Report of the Director of Finance and Public Value (DFP/24/90) outlining the budget monitoring position at month 4 (2024/2025), attached.

RESOLVED

(a) that the Month 4 budget monitoring forecast position be noted;

(b) that the Safety Valve Intervention programme update also be noted;

(c) that the budgets movements to date be noted; and

(d) that the forecast reserves position also be noted.

(Councillors Biederman, Brazil, Leaver and Whitton attended in accordance with Standing Order 25(2) and spoke to this item raising questions on safety valve, sufficiency in places for children (and historical data), earmarked reserves, manager numbers across the Council, legal disbursements and achievement of savings).

The Cabinet considered the Report of the Director of Finance and Public Value (DFP/24/90) outlining the budget monitoring position at month 4 (2024/2025), 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 4, it was estimated that budgets would overspend by just under £6 million. However, it was important to note that this excluded the Dedicated Schools Grant (DSG) deficit (at paragraph 3.18 in the Report).

Financial risks within Integrated Adult Social Care and Children and Young People’s Futures were still being experienced, but the work underway across the whole authority to support these pressures continued to ensure the whole organisation was focused on achieving a break-even position for the end of the year.

Before any contributions from the Department of Education (DFE) or the Authority the DSG was forecasting a £38.5 million pressure compared to the DFE Safety Valve planned position of £31.2 million, a difference of £7.4 million. Work was therefore underway to ensure the outturn was as per the Safety Valve agreement, the details being set out within section 3 of the Report.

The table at paragraph 3.1 summarised the Month 4 forecast position by directorate, excluding the Dedicated Schools Grant forecast. However, the process of realigning staffing and associated budgets being impacted as part of organisational and staffing changes were still being worked through, therefore the values referenced should not yet be considered final.

The Adjusted Budget (b) reflected budget movements between service directorates and non-service lines which had taken place up to the end of July 2024. Appendix 1 detailed the in-year budget movements in full. 

The delivery of budgeted savings, alternative funding and additional income (Savings) was reviewed throughout the year as part of the budget monitoring process. The table at paragraph 3.4 summarised delivery across the authority and applied a RAGB (Red, Amber, Green, Blue) colour rating to the level of confidence in delivery progress. 

Budgeted savings of £49.6 million had been identified as part of the budget setting process. At month 4 Directorates were forecasting delivery of £46.5 million.

Integrated Adult Social Care services were forecast to overspend by £1.1 million and Children and Young People’s Futures services an overspend of £6.6 million.  The Cabinet noted that paragraph 3.9 of the report was a typographical error and should not form part of the Report. The Report also outlined the SEND forecast accumulated deficit reflecting the position at month 4, the expected DfE contribution, and the contribution the authority had committed to making for the year.  A second progress update to the DfE had been submitted on 28th August 2024 detailing this position as well as progress made on delivering the transformation plan.

The latest DfE Safety Valve update also set out a number of areas where progress was being made which would improve the overall financial position and these were outlined in the Report.

At Month 4, the Climate Change, Environment and Transport directorate was forecasting an underspend of £333,000. Planned budgeted savings of £4.6 million were currently expected to deliver fully, however significant pressures were being managed within highways maintenance.

Public Health, Communities and Prosperity and Performance and Partnerships were forecasting to breakeven and fully deliver budgeted savings of £1.3 million.

Corporate Services were forecasting an overspend of £2.2 million, with Legal and Democratic Services forecasting an overspend of £1.8 million, the majority of which related to pressures association with legal disbursements. Corporate Services were forecasting savings delivery of £4.9 million against budget target of £5.1 million.

Non-service items, which include capital financing costs, interest earned and business rates pooling gain income, were forecasting an underspend of £3.5 million. 

The approved capital programme was £249.3 million, with the year-end forecast of £214.2 million. Slippage of £28.7 million was mainly due to Major Schemes within the Climate Change, Environment and Transport Directorate. The Capital Receipts position was outlined in the table in paragraph 3.34.

Corporate debt stood at £6.5 million, being 2.8% of the annual value of invoices, against the annual target of 1.9%.

At the beginning of the financial year, earmarked reserves (excluding schools and non-schools carry forwards) stood at just under £101 million.  During 2024/25 earmarked reserves were expected to decrease by just over £27 million to just over £73 million, as set out in the table at paragraph 3.38.

In addition to earmarked reserves, the General Fund Reserve (working balance) brought forward at the start of the financial year was just under £16 million.

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 McInnes, and

RESOLVED

(a) that the Month 4 budget monitoring forecast position be noted;

(b) that the Safety Valve Intervention programme update also be noted;

(c) that the budgets movements to date be noted; and

(d) that the forecast reserves position also be noted.