Agenda item

The Quarter 2 Budget Monitoring Report as presented to Cabinet at its meeting on 9 November is attached for the Committee to consider.

Contributors:

Mr John Chilver, Cabinet Member for Resources

Mr Richard Ambrose, Service Director for Corporate Finance (Section 151 Officer)

Paper:

Q2 Budget Monitoring Report

Councillor John Chilver, Cabinet Member for Finance, Resources, Property and Assets presented the Q2 Budget Monitoring Report which had been presented to Cabinet at its meeting on 9 November. Councillor J Chilver summarised the report which reflected the business as usual and Covid pressures faced during that period. An appendix provided further detail for each Portfolio and information about performance relating to overdue debts and late payments of commercial debt.

At the end of the Q2, an overall nil variance was forecast for the revenue budget 2021-22 after allowing for £4.8m of corporate mitigations.  This was a favourable movement of £0.5m since Q1.

The nil variance comprised:

(i)                  £4.9m adverse variance on Portfolio Covid related spend (£6.7m adverse August).

(ii)                £0.1m favourable variation on Portfolio BAU (£0.9m adverse August).

(iii)              £2.8m favourable variation on Corporate Contingencies (£4.0m August).

(iv)              £0.9m favourable variation relating to Covid Sales Fees and Charges compensation scheme.

(v)                £1.1m favourable variation on Corporate Budgets, principally capital financing costs.

Figure 1 (Cabinet report) detailed high level information for each Portfolio. 

The total Portfolio net revenue forecast variance was £4.8m adverse (1.1% of the total Portfolio budget).  Significant risks to the Revenue forecasts had been identified, a proportion of which were likely to materialise. These and any new pressures could potentially be covered by a number of contingencies that were not yet fully committed and could be used, if required.  Appendix 1 provided further detail on the revenue forecast outturn by Portfolio.

Figure 2 showed performance, by Portfolio and against savings targets, for the £13.2m of savings that had been incorporated into the 2021-22 revenue budgets.

Figure 3 provided information on the Contain Outbreak Management Fund (COMF), funding provided to local authorities to help reduce the spread of coronavirus and support local public health. Buckinghamshire was expected to benefit from £15.9m of funding spread over three financial years.  The approved spend was for £6.125m in each of 2020-21 and 2021-22.

Capital Budget Outturn

Capital slippage had increased between Q1 and Q2 from 1.6% (£3.0m) to 7.9% (£14.8m). Whilst this was currently below the corporate target of 10% there was an expectation that slippage may increase further in future months because there were reduced opportunities to catch up on delays as the year progressed.  Details were provided of a number of specific circumstances that had impact on the progress of capital projects.  Further details for each portfolio were found in Appendix 1.

During discussion, the following key points were raised by the Committee:

• A member noted that a breakdown of the impact of COVID-19 on the revenue budget for areas such as transport would be helpful in determining budgets for next year. It was advised that COVID-19 assumptions had been forecast when setting the budget for 2021/2022, particularly around income loss in parking, rental and leisure. Members were advised that many of the reduced income variances were related to pandemic implications, but that some of this had been claimed back from the government’s Sales, Fees and Charges income protection scheme for the first quarter of the year. There were Client Transport pressures (particularly transport for SEND children) with additional costs relating to both demand and complexity. This was being assessed as part of the budget build process for next year, with analysis on whether certain pressures would be one off or on-going. This Committee would, through its budget scrutiny inquiry in January, test assumptions made in the draft budget. 
• A Member also commented that some savings noted in the report would be repeatable such as some of those noted within climate change; however, decisions would need to be made on underspends in other areas such as Communities. The papers for the draft budget would be published prior to Christmas for Cabinet to consider at its meeting on 6 January, before being reviewed by the Budget Scrutiny Inquiry Group.