Agenda item

To consider Item 6

The Deputy Director of Finance and Assets advised Members that the budget monitoring report being presented today was up to the end of June 2021.  Appendix A provided an overview of each directorate’s budget and forecast outturn.  The current expenditure forecast of £31.6m against a budget of £32.277m resulted in an underspend of £677k.  However, due to additional funding of £384k in relation to protection grants and local tax income guarantee, there was a net overall underspend of just over £1m.  Due to the underspend, the Authority no longer needed to fully utilise £1.1m planned use of reserves and instead was intending to transfer £52k from reserves to balance the funding requirement.  Any fluctuations in the figure throughout the financial year would be captured and monitored to ensure the use of reserves was minimised and offset against any underspend identified within the expenditure.

The Deputy Director of Finance and Assets highlighted underspend seen within the Finance and Assets, Service Delivery, Corporate Development & Planning directorates.  Within Finance and Assets, the £256k underspend related to a rebate received following a business rates review.  The review was carried out by external specialists who identified reductions in the rateable value of several stations and was backdated to 2017.  The other area with high levels of underspend was predominantly employee costs.

The Deputy Director of Finance and Assets updated Members on how the Authority had utilised £801k of Covid funding since March 2020.  Funding had been used to cover additional employee costs, protective equipment, and IT upgrades.  Based on current projections, the Covid funding would be fully utilised by September 2021.

The Capital programme budget for 2021/22 was £2.402m.  Property capital funds were utilised to carry out planned capital projects as per the condition surveys.  Most of the fire appliance and equipment budget would be utilised to purchase red fleet appliances and the related operational equipment.  A slippage of £369k had been forecast due to delays in the delivery of the 2021/22 fire appliances.

A Member asked if the delivery delay of new appliances had a negative impact on operations.  The Deputy Director of Finance and Assets assured Members that the delay in delivery had not affected operations as Workshops had a robust servicing plan.

Members discussed the increased National Insurance contributions. The Director of Finance and Assets assured Members that there should be no additional costs to the Authority as the Government had announced that national Insurance increases would be met by central government for all local government organisations.  The logistics of the national insurance increase and payments were still being investigated. 

A Member enquired about the consolidation of staff and if this was carried out regularly.  The Deputy Director of Finance and Assets informed Members that new software had enabled Finance and Human Resources to introduce more efficient ways of working and this had enabled the reduction of staff.  In future, any new positions had to be agreed by the Senior Management Team and signed off by the Director of Finance and Assets.

Members asked about the long-term use of Reserves and if rising costs and inflation were considered when setting next year’s budget.  The Deputy Director of Finance and Assets informed Members that the use of reserves would be needed to cover the 2022/23 budget if no additional funding was given.  When setting budgets, inflation was considered and was reflected in the final figure.  It would also be hoped that when the government issued final settlements, inflation would be taken into account. 

RESOLVED –

That the provisional outturn forecast for the Authority as of 30 June be noted.