Agenda item

To consider the Q3 report as presented to Cabinet on 21 March 2023.

Contributors:

Councillor John Chilver, Cabinet Member for Accessible Housing & Resources

David Skinner, Service Director for Finance (Section 151 Officer)

Paper:

Budget Performance Monitoring Q3

The Chairman welcomed Councillor J Chilver, Cabinet Member for Accessible Housing and Resources, and the officers to the meeting. In the Cabinet Member’s presentation, the following points were highlighted:

·       The report showed the forecast revenue and capital outturn for the end of quarter three. A breakeven position was forecast for the end of the financial year, despite high levels of inflation and continuing pressures on services. This was an improvement on the forecast overspend of £1.8m reported for quarter two.

·       The analysis by portfolio showed an overall overspend of £14.3m, offset by £14.3m of corporate mitigations. The largest areas of overspend were £6.7m in Children’s Services due to placement cost and increased complexity of need; £3.9m in Housing, Homelessness and Regulatory Services due to increases for temporary accommodation; and £3.4m in transport services due to increased fuel costs.

·       The Climate Change & Environment portfolio showed a favourable variance of £3.3m from the sale of electricity at the Energy from Waste plant, due to an increase in electricity price. 97% of target savings were expected to be delivered by the end of the year. £38m in grant funding had been received, with the largest to help Ukrainian refugees. The overall forecast net variance was £30.7m. £33.2m related to slippage, which was 22% of the overall budget. The biggest areas of slippage were major infrastructure and regeneration schemes.

·       The total debt had seen an increase from quarter two of £1.8m, though unsecured debts over 90 days had been reduced. Late payments were marginally below the target of 95% but increased by 3% from the last quarter.

The following points were noted during the Committee’s discussion:

·       At the end of February, the trend data had stabilised which was starting to reflect in Q4. No major fluctuations in the budget were expected. Future financial risks were further mitigated through contingencies and the financial risk reserve. Some of the pressures in children’s services were heightened due to delays in health provision and recruitment, but these were not expected to occur going forward.

·       One of the challenges in budget setting was the lack of certainty from central Government around grant funding. Thus, some of the grants that may become available were not included in the budget. However, an analysis on this issue was currently being conducted.

·       Housing costs had increased quite dramatically, and housing benefit payments had not increased at the same rate. This was a national issue and raised by the LGA. The Council would help contribute information to the overall lobbying position. Temporary accommodation was a key financial risk due to the Council’s obligation to provide housing to people with no alternative means of accommodation, which could mean providing hotel stays. The relationship between income and expenditure was discussed, and this was being monitored. Additionally, both temporary and permanent accommodation options were being considered.

·       There was significant slippage in the Aylesbury electric grid expenditure capital amount. Land was currently being identified as a site for new developments. Discussions were also held with National Grid, with one site having been excluded. Further information around possible delays would be provided to the Committee once this was available.

ACTION: D Skinner

·       The budget for Kingsbrook school included several contingencies which had not been needed. The project was noted to have been a success and remaining funds could be used for similar schemes in the future.

·       A Member suggested that the report table did not accurately reflect the dynamic between waste expenditure and the Energy from Waste income which was present in the accompanying narrative. The suggestion was noted and would be considered in future reports.

ACTION: D Skinner

·       It was highlighted that the income for planning applications had reduced due to fewer applications being submitted. The number of agency staff could be reduced long-term to save costs, but currently this was not possible due to the backlog in applications which needed to be actioned. Discussions were already being held with high-quality agency staff to convert their contracts to permanent. However, due to the national shortage in planners and high salaries in the private sector, this was challenging. Work was also being done to promote Buckinghamshire Council as an employer of choice. Agency work was constantly under review due to the changing nature of planning workload, and a report would be brought to the Committee in the summer.

The Chairman thanked the Cabinet Member for the report.