Agenda item

To consider the Budget Monitoring Outturn 2022-23 as reported to Cabinet on 13 June 2023.

Contributors:

Councillor John Chilver, Cabinet Member for Accessible Housing & Resources

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

Papers:

Budget Monitoring – Outturn 2022-23

The Cabinet Member for Accessible Housing & Resources introduced the report and highlighted the following:

·       The Council had achieved a balanced revenue position for 2022-23 which reflected the Council’s robust financial processes.

·       Challenges from inflation and increased service demand had particularly impacted Adults social care, Children’s services, home to school transport and temporary accommodation.

·       The balance had been helped by funds set aside, Energy from Waste income and interest income.

·       There had been an adverse variance of £9.8m on portfolio spend offset by £9.8m corporate mitigation. Noted overspends in portfolios were:

o   Children’s Social Care £4.9m due to increased placement costs. 

o   Homelessness and Regulatory Services £4.7m due to increased demand in temporary accommodation.

o   Transport £3.2m due to increased contract costs in home to school transport.

o   Health & Wellbeing £2.4m due to demand pressures and fee uplifts in adult social care.

o   Accessible Housing & Resources £2.1m mostly caused by increased energy costs in council owned properties.

·       A favourable variance of £7.2m in the Climate Change & Environment portfolio was due to the market increase of energy costs. An £4m had been received from interest rates.

·       96% of the £19.2m savings target had been achieved for the year.

·       For the capital budget, £107.5m had been spent against the budget of £150.9m. The released budget had been £129.9m; a variance of 17% against a target of 10%.

·       Capital slippage was £53.8m in part due to construction inflation, labour pressures, supply shortages and delays to property acquisition. Two programmes highlighted were the Future High Streets Fund, High Wycombe, and the Aylesbury Grid Reinforcement.

·       Payment performance closed at 95.8% which was above the target and an improvement from Q3.

·       Overall debt levels continued to be monitored at £9.2m which was within the 10% KPI.

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

·       A number of Members congratulated the balanced 2022-23 outturn position given the pressures caused by increased demand and fuel and inflation costs.

·       There had been some improvement in Children’s services due to one-off activity, for instance one high-cost placement had been delayed. Children’s and Adult Social Care remained a risk due to their difficulty in forecasting demand.

·       The legal cost pressures, which had been increasing throughout 2022-23, had reduced in Q4 leading to an improved end of year position.

·       There was a delay in the audit of the 2021-22 statutory accounts however, subject to completion, no movements were expected.

·       The Leader noted three main themes from the budget outturn:

o   In response to the energy price increases, the Council had forward bought its energy at a fixed rate however since then, the market price had decreased. The change in energy price also meant that the projected income from the Energy from Waste site would not be as high as expected.

o   Parking income had not returned to expected levels and appeared to have plateaued thereby reducing projected income.

o   The social care demands meant that the Council was considering other means of care delivery, for instance via in house means, however the risks of needed to be carefully considered.

·       The Council’s contingency process was robust and proven to be the right decisions to manage risks. It was felt that the quantity and quantum of risks was increasing annually.

·       The Council had not had to utilize general fund reserves to balance its budget unlike other local authorities.

·       A Member highlighted that the auditors for 2021-22 had noted for savings to be outlined in more granularity. The Council would be providing this in future.

·       The Council was on track to deliver the unitary savings as outlined in the single-unitary business case. £45m had been delivered in savings between 2020-2023 which had helped with budget pressures.

·       The slippages in the Future High Streets, High Wycombe, and the Aylesbury Grid Reinforcement would be delivered in 2023-24. Slippages in capital projects may impact their deliverability method and/or require additional funding e.g. Homes England had been approached to vire money for the SEALR.   

·       Current loans were on fixed rates so had been protected by increased interest rates. The Council had also not taken out any new loans.

The Chairman thanked the Cabinet Member for the report and noted the Committee’s support in the 2022-23 outturn.