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Agenda Item No. 5

 

The Vale of Glamorgan Council

 

Learning and Culture Scrutiny Committee: 19th September 2016

 

Report of the Managing Director

 

Revenue and Capital Monitoring for the period 1st April to 31st  July 2016

 

Purpose of the Report

  1. To bring to the attention of this Scrutiny Committee, the position in respect of revenue and capital expenditure for the period 1st April to 31st July 2016 regarding those revenue and capital budgets, which form this Committee's remit.

Recommendation

It is recommended that :-

  1. Scrutiny Committee note the position with regard to the 2016/17 revenue and capital monitoring.

Reason for the Recommendation

That Members are aware of the position with regard to the 2016/17 revenue and capital monitoring relevant to this Scrutiny Committee.

Background

  1. Council on the 2nd March 2016 (minute no 885 and 884 respectively) approved the Revenue and Capital Budgets for 2016/17. Reports monitoring expenditure are brought to this Committee on a regular basis.
  2. Following changes to the remit of Scrutiny Committees, Equalities and Welsh Language budgets are now included in this report.

Relevant Issues and Options

Revenue

  1. The Revenue Budget for the Directorate is projecting an adverse variance of £672k at year end, however, proposals to mitigate this position are outlined in the report.
  2. In year savings targets will be applied to all budget holders across the directorate, however, this sum could be funded from reserves as a short term measure.

Learning & Culture               

Revenue Budget

Probable Outturn

Variance

(+ ) Favourable

(-) Adverse

 

£000

£000

£000

Schools

81,009

81,009

0

School Improvement & Inclusion

3,638

4,523

(885)

Service Strategy & Regulation

250

229

+21

Strategic & Resources

9,174

9,058

+116

Children & Young People's Partnership

275

252

+23

Total Education and Schools

94,346

95,071

(725)

Libraries

2,051

2,051

0

Youth Service

1,081

1,032

+49

Adult Community Education

277

277

0

Catering

1,489

1,489

0

Art Development

115

111

+4

Equalities & Welsh Language

203

203

0

Use of Reserves/Identified Savings

0

(672)

+672

TOTAL

99,562

99,562

0

       
  1. A graph and table setting out the variance between profiled budget and actual expenditure to date is attached at Appendix 1.
  2. Schools - The delegated budget relating to schools is expected to balance as any under/over spend is carried forward by schools.
  3. School Improvement & Inclusion - The service is projected to outturn with an adverse variance of £885k, which is as a result of an adverse variance of £817k on the recoupment income budget and an adverse variance on pupil placements of £245k. This position can be partly offset by projected salary underspends of £177k which have resulted from vacant posts in the service. The service has a £2.4m recoupment income budget in respect of out of county pupil placements purchased at Ysgol y Deri. Over the last few years a trend has occurred where more out of county pupils have left Ysgol y Deri than new pupils have enrolled. In the current financial year it is anticipated that 15 out of county pupils will leave the school and only 4 new starters will enrol, in the previous financial year there were 17 leavers and 3 new out of county enrolments. The main reason for this reduction in out of county pupils is due to other Local Authorities seeking to educate their children within county and to source cheaper alternatives due to budget reductions. However the school is still operating near to capacity due to an increase in demand from Vale pupils requiring placements. Whilst the Directorate has been successful in identifying reshaping savings for the Inclusion Service, the Directorate has been unable, to date, to identify further savings to cover this gap on recoupment income. This adverse variance could reduce if there are new out of county enrolments in September 2016. The pupil placements budget is a volatile budget that can be significantly impacted with changes to packages of one or two pupils. £500k has been set aside in a Schools Placements reserve. This sum will be used as a one off contribution in 2016/17 to mitigate part of the shortfall while further Reshaping Services work is undertaken by the Directorate. If this shortfall cannot be mitigated further in the year, further reserves could be utilised to balance the shortfall made up of £50k from the Excluded Pupils reserve, £44k from the Youth Service reserve and £78k from the Adult Community Learning reserve.
  4. Service Strategy and Regulation - This service is currently projecting a favourable variance at year end of £21k, due to reductions in office expense for the Directorate.
  5. Strategic and Resources - This budget is currently projecting to outturn with a favourable variance of £116k as a result of vacant posts, an increase in ICT support packages purchased by schools and a reduction in the number of supported non-maintained nursery settings. These favourable variances have been partly offset by a number of redundancy costs within schools.
  6. Children and Young Peoples Partnership - It is anticipated that this service will outturn with a favourable variance of £23k as savings have been identified in running costs.
  7. Provision has been made within the budget to make unsupported borrowing debt repayments in relation to the Schools Investment Strategy of £698k per annum and any favourable variance on debt repayments will be directed into the Schools Investment Strategy.
  8. Libraries - This service is currently projecting to outturn on budget after transferring any legal costs and costs relating to the implementation of the service review out of the Libraries reserve. A judicial review has delayed the implementation of the Community Libraries. This delay in implementation will have an impact on the service's ability to achieve budget savings in 2016/17, however, any shortfall will be funded from the Libraries Reserve.
  9. Youth Service - It is currently anticipated that the Youth Service will outturn with a favourable variance of £49k due to part year vacancies within the service.
  10. Adult Community Learning (ACL) - It is anticipated that the Adult and Community Learning Service will outturn at budget after a £45k transfer from the ACL reserve. This transfer is required to assist with new Welsh for Adults contract and a previous years funding reduction in Schedule 2/Cardiff and Vale College Franchise.
  11. Catering - It is currently anticipated that this service will outturn at budget, however, variations in school meal income will affect this position. School meal uptake will be carefully monitored throughout the year. A clearer projection will be available after the September intake.
  12. Arts Development - It is currently anticipated that the service will outturn with a favourable variance of £4k.

2016/17 Savings Targets

  1. Attached at Appendix 2 is a list of savings to be achieved this year for this Committee.
  2. There is a saving target of £292k to be found from the Inclusion Service budget. It is anticipated that this level of saving can be achieved during the year, however, there are further pressures on the budget which will result in an overspend as already detailed above.

Capital

  1. Appendix 3 details financial progress on the Capital Programme as at 31st July 2016.
  2. Appendix 4 provides non-financial information on capital construction schemes with a budget of over £100k. Where a budget shown in Appendix 3 is more than £100k but is made up of several schemes that individually are less than £100k, the scheme is not included in Appendix 3.
  3. For all schemes where it is evident that the full year's budget will not be spent during the year, the relevant officers are required to provide an explanation for the shortfall and this shall be taken to the earliest available Cabinet.
  4. Gwenfo Primary Expansion - Delegated authority has been used to approve a virement to this scheme of £40k from the Education Asset Renewal Contingency budget, in order to allow the project to be completed and to meet all the educational needs of the school.

Resource Implications (Financial and Employment)

  1. As detailed in the body of the report

Sustainability and Climate Change Implications

  1. As detailed in the body of the report

Legal Implications (to Include Human Rights Implications)

  1. There are no legal implications

Crime and Disorder Implications

  1. There are no crime and disorder implications

Equal Opportunities Implications (to include Welsh Language issues)

  1. There are no equal opportunity implications

Corporate/Service Objectives

  1. Effective monitoring assists in the provision of accurate and timely information to officers and Members and in particular allows services to better manage their resources

Policy Framework and Budget

  1. The report is in accordance with the Policy Framework and Budget

Consultation (including Ward Member Consultation)

  1. The appropriate Chief Officer has been consulted. This report does not require Ward Member consultation

Background Papers

None

Contact Officer

Carolyn Michael (Operational Manager - Accountancy)

(01446 709778)

Officers Consulted

Head of Strategy, Community Learning & Resources

Responsible Officer:

Rob Thomas, Managing Director

 

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