Agenda item

Report attached.

Councillor Joyce Plummer, Portfolio Holder for Resources, provided a report to inform Cabinet of the financial spending of the Council up to the end of August 2022 and the financial forecast outturn position for the Accounting Year 2021/22.

Councillor Plummer provided a brief introduction to the report.  The Council was on course to achieve a positive variance of £89k on its Budget for 2022/23.  This took into account the proposed annual pay award, which was larger than had been predicted when the Budget had been set, as well as increased energy costs due to the Russian invasion of Ukraine.  Increasing energy costs had been mitigated by good energy management and the Government’s package of financial support.  Budget holders had worked hard to contain inflationary pressures within Budget.  The forecast assumed that additional expenditure caused by any future spike in COVID-19 cases would be funded by the Government.

Councillor Noordad Aziz indicated that he had submitted some 15 questions directly to the Portfolio Holder via e-mail, this afternoon, for a written response, but he would be grateful if answers could be provided today to the following:-

• Given that the variance on year to date expenditure as at 5 August, shown in the Table (at Page 124), was £4,265k, how did the projected expenditure only produce a predicted year end variance of £87k?  -  Response: The Deputy Chief Executive indicated that report focused on the anticipated year end variance, but that during the year money flowed into and out of the Council.  At the start of the year spending decisions might have reflected a difficult cashflow position.  Also, income will have been recorded in the system, but might be earmarked for future commitments.  The spending trajectory would, however, smooth out over the course of the financial year.  At the year to date point, the variance was around 80% of planned expenditure.
• Did the positive variances against Departmental staffing budgets reflect unfilled staff posts?  -  Response: The Leader indicated that this question would be answered within the written response due to be provided.

Approval of the report was not deemed a key decision.

Reasons for Decision

The detailed figures underpinning the report were shown as a table at the end of the document provided.

The current forecast spend to the end of the financial year in March 2023 was £12,246,000 compared to a Budget of £12,334,000.  The forecast produced a positive variance of £89,000 by the end of the financial year. 

The report included more detailed commentary about expenditure in the following service areas:-

Environmental Services

Environmental Services were predicting a year-end adverse variance of £155,000.  Waste Services were predicting an adverse variance for the year of £61,000.  This was due to £103,000 of additional costs and a predicted decline in income of £3,000, offset by £46,000 savings on staff costs.  The Parks & Cemetery Service was forecasting an adverse variance of £84,000, due to additional income of £22,000 and savings of £17,000 on staff costs less £123,000 of miscellaneous additional costs.  The Town Centre & Market Budget was predicting an adverse variance of £33,000, with £35,000 of additional operating costs less £2,000 of salary saving.  Environmental Health were predicting a positive variance of £23,000 due to £35,000 of additional income and £19,000 of savings on expenses less £31,000 of additional staff costs.

Culture & Leisure Services

Culture and Leisure Services were indicating a positive variance of £81,000.  Service expenditure on Leisure was forecasting a positive variance of £130,000, while the Haworth Art Gallery was predicting an adverse variance of £50,000 due to increased expenditure on staff of £13,000, and £46,000 of additional expenditure less £9,000 additional income.

Planning & Transportation

Planning & Transportation were predicting an adverse variance for the year of £133,000.  This is due to predicted unfinanced additional spend on salary costs of £93,000, £38,000 of extra miscellaneous costs and £2,000 less income.

Regeneration & Property Services

Regeneration & Property Services were predicting a small adverse variance of £21,000 at year-end.  This was the net of additional staff and miscellaneous costs less additional income.

Policy & Corporate Governance

Policy & Corporate Governance were predicting a positive variance of £132,000.  This was due to £23,000 of salary savings less the Corporate Salary Savings Target of £101,000, an increase of income of £122,000 and £88,000 additional miscellaneous savings.

Non Service Items

The current estimate for the year was a positive variance of £185,000.

In respect of the robustness of the forecast and other issues, the Council was facing a period of inflationary pressure, particularly in relation to energy and fuel costs and the national pay award for Local Government Employees remained unsettled.  The current forecast included the latest assumptions around these developments, but the situation remained volatile.  Any significant changes in the underlying Budget assumptions that impacted the overall outturn forecast would be reported at the next Cabinet meeting.

As in the previous two years, if there was a spike in COVID-19 that required the Council to take action to prevent the spread of the virus or to provide additional support to the local community, it was expected that additional funding provided by Government would be used to meet any additional costs the Council incurred.

There were no alternative options for consideration or reasons

Resolved                                    -    That Cabinet notes the reportand asks Corporate Management Team to continue to reduce expenditure and increase income so as to further improve the overall financial position of the Council over the remaining months of the year.