Agenda item

Context:

The purpose of the report is twofold:

·         To provide all Members with holistic information on the revenue and capital outturn position of the Authority at the end of reporting period 2 which represents the financial outturn position for the 2018/19 financial year based on October inclusive activities.

·         To be considered by Select Committees as part of their responsibility to:

-       Assess whether effective budget monitoring is taking place.

-       Monitor the extent to which budgets are spent in accordance with agreed budget and policy framework.

-       Challenge the reasonableness of projected over or underspends.

-       Monitor the achievement of predicted efficiency gains or progress in relation to savings proposals.

Recommendations Proposed to Cabinet

1.    That Members consider a net revenue forecast of £316,000 surplus, and approves the local education authority costs of compromise agreements being borne by the corporate redundancy budget rather than Children and Young People Directorate.

2.    That they also recognise circa £1.3m extra capital resourcing provided recently and note that the revenue forecast is predicated on capitalising £444,000 expenditure accordingly, a decision that still needs to be considered by full Council in January 2019.

3.    That Members note the 86% delivery of the budget setting savings agreed by full Council previously and a need for remedial action/savings in respect of £727,000 savings reported as delayed or unachievable by service managers.

4.    That Members consider the capital outturn spend of £40.8m, introducing a £1m anticipated overspend and the presumption made around financing such as per para 3.6.7. of the report.

5.    That members note the anticipated use of reserve funding predicted at outturn and the low level of earmarked reserves, which will notably reduce the flexibility the Council has in re- engineering services and facilitating change to mitigate the challenges of scarce resources going forward.

6. Members note the extent of movements in individual budgeted draws on school balances, and reported recovery plan intentions as a consequence of their approving changes to Fairer Funding guidelines since month 2.

Member Scrutiny:

·         A Member asked about street lighting, and the move to LED lights and questioned the increased energy costs to £72,000 per annum.  It was responded that lighting columns and lights were changed under a Welsh Government Scheme that incurred some costs to pay the loan.  Savings will be achievable in the longer term.  The Member asked about the effect of the drop in the value of the pound and oil prices, and a no deal Brexit.  It was suggested that prices are rising and the authority is mitigating by undertaking energy efficiencies e.g. PV panels and solar farms.  There is an option to apply for generating status to become more self-sufficient.  Information was provided that the value of the energy contract has increased by 16%.

·         The Chair asked about reserves and the ability of the authority to cope with major problems, and to protect our rural community e.g. in relation to Brexit.  It was responded that the council has £7million for the short term and then Welsh Government would be expected to step in.