Agenda item

Report attached.

The Cabinet considered a joint report of Councillor Noordad Aziz, Deputy Leader and Portfolio Holder for Transformation, Education and Skills, and Councillor Vanessa Alexander, Portfolio Holder for Resources and Council Operations, informing Cabinet of the draft financial spending of the Council up to the end of the financial year in March 2024.

Councillor Aziz introduced the report and added that the controlling group would wish to consider priorities regarding the Council’s finances going forward.  Councillor Khan stated that he was pleased to see that the revenue outturn report did not support the view expressed by some that the Council had a ‘black hole’ in its finances.

The Leader highlighted the controlling group’s intentions regarding the setting aside of reserves, including the allocation of £100k to support net zero projects and £0.5m this year to start to address the issue of a waste transfer station.

Approval of the report was not considered to be a key decision.

Reasons for Decision

At the Full Council meeting on 23^rd February 2023, Council had agreed the General Fund Revenue Budget for 2023/24.  This had set a budget for the Council’s total spend in 2023/24 of £14.383M.

The provisional revenue outturn position for the 2023/24 financial year was a total spend for the Council of £14.024M.  This gave a revenue underspend on net expenditure of £0.359M compared to the budget set at the start of the year.

Additional funding of £0.626M had been realised during the year compared to that set out in the budget.  This was mainly due to lower amounts being due back to Central Government in respect of COVID grants that had been expected at the previous year end.

These brought the total underspend for the year against the budget to £0.985M.  Actual Performance against Budgets for each service area and for funding received, was set out in a detailed table in the report.

Forecast total net expenditure of £13.925M had been reported to Cabinet on 24^th January 2024.  The provisional outturn showed an increase in the overall underspend of £0.527M compared to that reported at Quarter 3.

A summary of the changes between the Quarter 3 forecast and the provisional were highlighted in a further table in the report.  Amendments to the Quarter 3 forecast were due to a reallocation of property maintenance costs in line with the accounting in the outturn figures.

Work was ongoing to produce the Final Accounts, and they would subsequently be subject to External Audit.  The underspend of £0.985M was therefore provisional at this stage.

Variance by Service

Details of the variances between the budget and previous quarters’ forecasts had been reported to Cabinet in the in-year monitoring reports.  A narrative was provided in the report with tables for each service area, which provided more detail on the variances from the forecast outturn reported at Quarter 3 and the provisional outturn position.  A summary of the provisional outturn variances by service area was as follows:

Reserves

The Council had seen an increase of £2.7M in its usable reserves during the year.  Movements in reserves were set out in a table provided in the report.  The table included the allocation of the underspend of £0.985M across the reserves as set out below:

• A total of £840,000 to be added to the Balances Set Aside to Fund Specific Future Expenditure and Climate Change reserves, made up of:

• The remaining £145,000 had been transferred into the Invest to Save / Underspends reserve and was delegated to the Chief Executive to approve.  Requests for the use of this reserve in supporting budget pressures and any increases in future service provision, would be discussed with the relevant portfolio holder.

The most significant movement in reserves was the addition of £5.0M to the Levelling Up and Leisure Investment reserve as a result of improved performance on the Business Rates Retention Scheme, as mentioned in paragraph 4.9.3 of the report.

There had been other transfers between earmarked reserves during the year.  This was to better represent the expenditure for which these reserves would be required to fund.

There were no alternative options for consideration or reasons

Resolved                                 (1)   That Cabinet notes the provisional outturn of spend against the Revenue Budget for 2023/24 and the underspend in year of £985,000.

(2)   That Cabinet agrees to set aside £840,000 of the underspend in year, into earmarked reserves to be used to fund the identified pressures on future services and support the Council’s commitments on Climate Change, as detailed in paragraph 4.10.2 of the report.