Agenda item

FINANCIAL MONITORING REPORT APRIL 2016 - JUNE 2016

A report from the Interim Executive Director of Resources and Regulation is attached.

 

Minutes:

Steve Kenyon, the Interim Executive Director of Resources and Regulation presented a report updating the Committee on the authority’s financial position in line with the Committee’s Statement of Purpose to ‘Provide independent scrutiny of the authority’s financial and non financial performance to the extent that it affects the authority’s exposure to risk and weakens the control environment’.

 

It was reported that that the authority is projecting an overspend of £6.395m for the year, based on spending and income information as at 30 June 2016.

 

It was explained that the Authority’s financial position is continually monitored throughout the year, monthly reports are considered by departmental management teams and summaries available to Cabinet Members. A monthly summary is submitted to the Senior Leadership Team and to the Cabinet Member for Finance.

 

Quarterly detailed monitoring reports are considered by the Senior Leadership Team, the Cabinet, Star Chambers and the Overview and Scrutiny Committee. These set out a risk assessed summary of the financial position, explanations of major variances from budget, an assessment of the minimum level of balances, information on the forecast balances position and an assessment of performance against the objectives of the Financial Strategy.

 

It was explained that the projected overspend of £6.395m represents approximately 5.09% of the total net budget of £125.536m, and compares to an overspend of £1.480m at the same point in 2015/16.

 

An overview of the variance was outlined in the report.

 

It was reported that due to the extremely difficult financial situation facing the Council in 2016/2017 the Senior Leadership Team had agreed and drawn up an action plan with some immediate additional spending controls over and above the usual controls:-

 

·         Recruitment freeze on staff and new agency placements (exceptions to be signed off by SLT);

·         Release of all existing casual/agency staff (exceptions to be signed off by SLT);

·         Cease overtime/additional hours (exceptions to be signed off by SLT);

·         Enter into no new training commitments and review existing training (exceptions to be signed off by SLT);

·         Re-launch Work Life Balance options around reduced hours/purchase of leave;

·         Cease spend on discretionary budgets; stationery, office equipment etc;

·         Cease spend on IT/Communications (exceptions to be signed off by SLT);

·         Any spend greater than £250 to be signed off by Executive Director;

·         Any new contractual commitments greater than £5000 (lifetime value of contract) to be signed off by SLT;

·         Consider “in year” budget options – e.g. previously unidentified efficiencies, review of non key services.

 

These controls had been in place since 9 August and compliance was being monitored.

 

In addition Executive Directors have been tasked with preparing turnaround plans as a matter of urgency for their departments to ensure that levels of expenditure are controlled and sustainable going forward.

 

Work was being carried out in relation to procurement activity and the possibility of renegotiating contracts including ones that weren’t as yet up for renewal.

 

It was explained that the report being presented showed month 3 figures so the situation will have moved on. The month 6 report would be produced over the coming weeks and would show the most recent figures.

 

Those present were given the opportunity to ask questions and make comments and the following points were raised:-

 

·         Councillor Whitby referred to future proofing in relation to demand pressures and asked what was being done about this.

 

It was explained that all members of staff had been briefed and had been asked to look at ways that the Council and staff could be more innovative. An email address had been given out where suggestions and ideas could be sent.

 

·         Councillor Jones asked whether unachievable cuts had been set at the time that the current budget was set and if this was the case how do we approach the next budget.

 

Steve stated that nothing was promised that was felt would be unachievable. He explained that the budget setting process was robust and savings plans put forward by the Executive Directors had been signed of by the respective Portfolio Holders and had been subject to challenge by himself and the then Cabinet Member for Finance.

 

·         Councillor Whitby referred to the ‘Invest to Save’ scheme within Children’s Services and asked how this was working out.

 

Steve explained that the Invest to Save schemes would take time to deliver and wouldn’t necessarily deliver in year. Realistically up to 3 years before the saving were delivered.

 

Delegated Decision:

 

That the contents of the report be noted.

 

Supporting documents: