Agenda item

Purpose:

1.    The purpose of this report is to provide Members with information on the revenue and capital outturn position of the Authority based on capital slippage and reserve approval and deferment.

2.    This report will also 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, and

•     monitor the achievement of predicted efficiency gains or progress in relation to savings proposals.

3.    Recognising the twofold purpose to brief Cabinet/all members of the collective position, and individual scrutiny committees of specific aspects affecting their portfolio interests, the latter have been colour coded (green) to assist scrutiny members of particular committees

Recommendations proposed to cabinet:

1.       That Members consider a net revenue outturn of £49k surplus.

2.       That members endorse the revenue surplus for the year being used to replenish Capital Receipts generation reserve, and notes the effective closure of the priority investment reserve, appreciating the use of reserve balances at outturn, the slippage to 2019-20 proposed 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 scare resources going forward.

3.       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

4.       That Members note the 81% delivery of the budget setting savings agreed by full Council previously and the implicit remedial action/savings included in the financial monitoring to compensate for circa 20% savings (£951k) reported as delayed or unachievable by service managers.

5.       That Members note the enhanced monitoring of Children’s services and additional learning needs proposed, to supply details for instance of average unit costs, the activity and predicted volume of presentations used in forecasting, to allow services an earlier opportunity to highlight cost pressures and more time to resolve such by remedial action in year.

6.       That Members consider the capital outturn spend of £70.31m, introducing a £1.015m anticipated overspend, accepts slippage requests of £9.9m being endorsed and the related presumptions made around net financing consequences.

Member Scrutiny:

The Finance Managers for Social Care Safeguarding and Health, and for Children and Young People presented the report.  Following presentation of the report, Members were invited to ask questions and make comments:

Children Services Budget

·         A Member commented about the significant rise in numbers of Looked After Children (LAC) and asked if this number is likely to continue to rise.  It was agreed that there is an increasingly upward trend.  Select Committee Members were reminded that the service undertakes a lot of preventative work but there is also a statutory duty for remedial action to address any significant risks.  It was explained that Monmouthshire receives the lowest funding in Wales and confirmed that every opportunity for efficiency is explored (e.g. a successful, in-house, fostering recruitment campaign and more use of special guardianship orders. 

·         It was questioned if there was a change in provision for Breakfast Clubs, and any consequent effect on take up.  It was responded that from September 2018, a £1 charge for children not eligible for Free School Meals (FSM) had been introduced for the childcare element. There had been some reduction in take up, and a small amount related to low income families.  Additionally some schools have introduced a booking system which has also caused some reduction in use.

Children and Young People Budget

·         A Member noted that schools have to raise funds more regularly to cover some activities such as away sports fixtures, trips abroad for low income families, extra-curricular activities.   It was explained that the majority of funding is from the revenue support grant and it is for Members to consider school budgets when determining budget strategy.

·         A Member expressed concern that there may be some disadvantaged children. 

·         A Member commented that the county is known for being one of the most efficient councils in Wales and recognised the work of officers accordingly.

·         Assurance was provided that there would be no impact on schools arising from the shortfall associated with breakfast clubs as they are centrally funded.

·         Regarding the overspend relating to Additional Learning Needs a breakdown of costs was requested for Members to better understand the implications as numbers and consequently costs are increasing.  Work is in progress to develop better data and it was suggested that this could be a topic for a future meeting.

·         Information on fair funding for schools was also requested. Fair funding regulations are explicit in precluding schools from setting deficit budgets if all schools collectively are in a deficit position.  All schools have been reminded of the recovery plan process.  It was commented that the level of revenue grants has been lower this year and that schools should not rely on the possibility that there will be a late disbursement of funds.

·         A Member provided information that Kirsty Williams, Minister for Education may consider a review of the funding formula.