Agenda item

The Cabinet noted the following:

1.  General Fund (Revenue) – A forecast balanced outturn on an approved budget of £160.202m, subject to sustained recovery action.

a.  The current projected overspend is £5.571m. Issues relating to data quality of Temporary Accommodation mean that forecasts in relation to Temporary Accommodation rent (predominantly Housing Benefit) and Housing Benefit subsidy are being reviewed as there is a concern that these forecasts are understated.

b.  Work is being undertaken to develop a robust forecasting methodology that is expected to significantly mitigate the current forecast, but it must be assured.

c.  Alternative measures will be implemented that will seek to contain pressures within budget.

2.  General Fund (GF) (Capital) – The revised capital budget is £27.283m with a projected outturn of £20.927m resulting in underspend of £6.356m This compares to a £10.134m forecast underspend in Quarter 2, albeit of a significantly altered budget.

3.  Housing Revenue Account (HRA Revenue) – An underspend of £3.036m is forecast, £0.441m lower than budget. This compares to a £3.478m forecast underspend in Quarter 2. 

4.  Housing Revenue Account (HRA Capital) – The revised capital budget is £20.639m with a projected outturn of £19.757m resulting in an underspend of £0.882m. This compares to a £5.362m forecast underspend in Quarter 2.

5.  Dedicated Schools Grant (DSG) – There is an overspend of £0.254m in the Schools Block due to higher than anticipated costs for growth in 2024/25. Further details are set out in para. 8 of this report including the risks This compares to a forecast overspend of £0.254m in Quarter 2.

6.  Council Tax and Business Rates collection – As at the 31 December, actual Council Tax collected was 79.95% (target 81.00%) and actual Business Rate collected was 82.18% (target 84.20%).

7.  Sundry Debt – Total outstanding sundry debt including adult social care debt as at the 30 November 2024 was £7.665m. Based on the age profile of the debt, £6.106m is the calculated bad debt provision (79.66%).

8.  Financial Resilience – The Council remains committed to improving financial resilience, moving towards financial sustainability and improvement in governance and process as laid out in the Directions issued by Government and a capitalisation direction for exceptional finance support in 2024/25.

9.  Once the Council has concluded the outstanding financial accounts, a formal financial resilience statement will be prepared.

The Lead Member for Finance, Council Assets and Transformation introduced a report that set out the Council’s current and forecast financial performance for the 2024/25 financial year to the end of Quarter 3, 31^st December 2024. 

The Council continued to be on track to deliver a balanced budget by the year end, although there were significant pressures on demand-led services particularly in temporary accommodation and adult social care.  The current projected overspend was £5.571m and delivering a balanced position would require sustained recovery action.  Robust measures were in place to control costs and challenge all expenditure decisions.  The revised General Fund capital budget was £27.283m and the projected outturn was £20.927m.  Updates were also noted on the Housing Revenue Account (HRA), Dedicated Schools Grant and the collection of Council Tax and Business Rates.

Lead Members asked a number questions about the action being taken in response to the overspend on temporary accommodation.  The Executive Director, Corporate Resources detailed the extensive work being done to resolve long-standing issues with data and housing benefits which aimed to improve the position.

The Cabinet also noted and welcomed the significant progress that had been made in clearing the backlog of accounts.  Whilst several sets of accounts since 2018/19 would have a disclaimed audit opinion, the closure of historic accounts would bring financial reporting back into line and be an important milestone in the Council’s financial recovery.

After due consideration the recommendations were agreed.

Resolved –  That the following be noted:

1.  General Fund (Revenue) – A forecast balanced outturn on an approved budget of £160.202m, subject to sustained recovery action.

a.  The current projected overspend is £5.571m. Issues relating to data quality of Temporary Accommodation mean that forecasts in relation to Temporary Accommodation rent (predominantly Housing Benefit) and Housing Benefit subsidy are being reviewed as there is a concern that these forecasts are understated.

b.  Work is being undertaken to develop a robust forecasting methodology that is expected to significantly mitigate the current forecast, but it must be assured.

c.  Alternative measures will be implemented that will seek to contain pressures within budget.

2.  General Fund (GF) (Capital) – The revised capital budget is £27.283m with a projected outturn of £20.927m resulting in underspend of £6.356m This compares to a £10.134m forecast underspend in Quarter 2, albeit of a significantly altered budget.

3.  Housing Revenue Account (HRA Revenue) – An underspend of £3.036m is forecast, £0.441m lower than budget. This compares to a £3.478m forecast underspend in Quarter 2. 

4.  Housing Revenue Account (HRA Capital) – The revised capital budget is £20.639m with a projected outturn of £19.757m resulting in an underspend of £0.882m. This compares to a £5.362m forecast underspend in Quarter 2.

5.  Dedicated Schools Grant (DSG) – There is an overspend of £0.254m in the Schools Block due to higher than anticipated costs for growth in 2024/25. Further details are set out in para. 8 of this report including the risks This compares to a forecast overspend of £0.254m in Quarter 2.

6.  Council Tax and Business Rates collection – As at the 31 December, actual Council Tax collected was 79.95% (target 81.00%) and actual Business Rate collected was 82.18% (target 84.20%).

7.  Sundry Debt – Total outstanding sundry debt including adult social care debt as at the 30 November 2024 was £7.665m. Based on the age profile of the debt, £6.106m is the calculated bad debt provision (79.66%).

8.  Financial Resilience – The Council remains committed to improving financial resilience, moving towards financial sustainability and improvement in governance and process as laid out in the Directions issued by Government and a capitalisation direction for exceptional finance support in 2024/25.

9.  Once the Council has concluded the outstanding financial accounts, a formal financial resilience statement will be prepared.