Agenda Item No. 7

The Vale of Glamorgan Council

Learning and Culture Scrutiny Committee: 26th March 2018

Report of the Director of Learning and Skills

Revenue and Capital Monitoring for the period 1st April 2017 to 31st January 2018

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 2017 to 31st January 2018 regarding those revenue and capital budgets, which form this Committee's remit.

Recommendation

It is recommended that :-

1. Scrutiny Committee consider the position with regard to the 2017/18 revenue and capital monitoring.

Reasons for the Recommendations

1. That Members are aware of the position with regard to the 2017/18 revenue and capital monitoring relevant to this Scrutiny Committee.

Background

2. Council on the 1st March 2017 (minute nos. 864 and 863 respectively) approved the Revenue and Capital Budgets for 2017/18.  Reports monitoring expenditure are brought to this Committee on a regular basis.

Relevant Issues and Options

Revenue

3. The projected outturn has improved from the position previously reported and is now anticipated to breakeven after a transfer of £564k from Learning and Skills reserves.   The Directorate has taken a number of steps to mitigate the complex needs overspend including freezing non-essential expenditure and holding budgeted posts vacant.  It had been proposed that £258k would be funded from the Council Fund however this may now not be necessary.

4. A graph and table setting out the variance between profiled budget and actual expenditure to date is attached at Appendix 1. 
5. Schools - The delegated budget relating to schools is expected to balance as any under/over spend is carried forward by schools.
6. Strategy, Culture, Community Learning & Resources - It is projected that the service will outturn with a favourable variance of £182k after drawing down £289k from reserves. There is an adverse variance of £75k relating to the schools long term supply scheme, however, premiums will be increased from April 2018 to ensure the scheme is sustainable in the future. There is an adverse variance of £14k anticipated on education transport which is managed within the Environment and Housing Directorate.  This is offset by favourable variances of £84k relating to staffing, £34k on ICT SLA income from schools, £54k from payments to non maintained nursery schools, £32k in Libraries, pension payments of £41k, £17k relating to Broadband and union backfilling of £9k.  The Catering service will draw down £16k from the Catering reserve to outturn at budget to fund urgent gas works required in schools as well as the school holiday enrichment programme.  The Schools Invest to Save Reserve will be used to cover the £99k adverse variance in relation to redundancies in schools, which is covered by a statutory requirement to be funded centrally. £105k from the Rationalisation reserve will be used to fund revenue costs in relation to the Barry Secondary school transformation, £22k from the Rationalisation Reserve will be used to fund one off staffing costs at Penarth Learning Community, a further £20k of the Rationalisation Reserve will be used to fund the cost of Welsh immersion for primary pupils transferring from English medium to Welsh medium schools and £17k will be transferred from the rationalisation reserve to cover amalgamation costs at St. Helens Primary school.  £10k of the Adult Community Learning reserve will be used to cover the adverse variance which is as a result of maintaining the service following a reduction in funding from Cardiff and Vale Colleges.
7. Directors Office - It is anticipated that this service will underspend by £30k due to a freeze on expenditure and non-replacement of one post which has been held vacant in order to partially mitigate the overspend on complex needs.
8. Achievement for All - This service is currently predicted to outturn with an adverse variance of £567k which will be partially met by transfers from reserves of £275k resulting in an adverse variance at year end of £292k.  A £403k adverse variance is projected on the recoupment income budget.  This budget is set for recouping income from other Local Authorities that purchase placements at Ysgol Y Deri.  The budget has been under pressure for a number of years as a result of a demographic increase in the number of Vale pupils presenting with complex needs which has resulted in less placements being available for other Authorities to purchase.  In addition, other Authorities have developed their own provision and the level of demand has reduced.   The adverse variance will be partially offset by a transfer from the School Placement Reserve of £200k.  It is anticipated that the Social Inclusion and Wellbeing service will overspend by £38k due to the remodelled guidance to engage NEETs prevention service and this overspend will be offset by a transfer from the Youth reserve.  A £186k adverse variance is projected for the pupil placements budget.  Occasionally the Council is unable to meet the needs of very complex pupils within Vale of Glamorgan resources and placements are purchased from independent schools or other Authorities.  Unit costs are typically very high and as a result this budget can be volatile as one new pupil can have a dramatic effect on the outturn.  There has been a significant increase in the number of pupils with social and emotional behavioural issues at Key Stage 3 and 4 whose needs cannot be met within our schools or the Pupil Referral unit.  As a result the Directorate has found no alternative but to place these pupils with external providers which has increased the adverse position in this area.  This overspend will be partially offset by a transfer from the Excluded Pupil reserve of £37k.  There are projected favourable variances of £60k on staffing.
9. School Improvement - It is anticipated that this service will underspend by £80k due to a freeze on expenditure and non-replacement of a senior post which has been held vacant in order to partially mitigate the overspend on complex needs.
10. Provision has been made within the budget to make unsupported borrowing debt repayments in relation to the Schools Investment Strategy of £598k per annum and any favourable variance on debt repayments will be directed into the Schools Investment Strategy.

2017/18 Savings Targets

11. Attached at Appendix 2 is a list of savings to be achieved this year for this Committee.  It is anticipated that the savings target will be met this year.

Capital

12. Appendix 3 details financial progress on the Capital Programme as at 31st January 2018.
13. Cadoxton Primary Water Heater - A delegated authority has been approved to include a new scheme with a budget of £17k into the 2017/18 Capital Programme.  This is funded through a virement from the Education Asset Renewal Contingency budget.  The water heater has been condemned and it must be replaced as a matter of urgency.
14. Ysgol Sant Curig Playground Resurfacing - A delegated authority has been approved to include a new scheme with a budget of £18k into the 2017/18 Capital Programme.  This is funded through a virement from the Education Asset Renewal Contingency budget.  The tarmac playground was inspected during the Summer 2017 and was found to be in poor condition, the school playing fields are currently out of use due to the wet ground conditions and therefore work needs to be undertaken to prevent closure of the playground.  The works will be completed during February half term.
15. Ysgol Iolo Morgannwg Boiler Renewal - A delegated authority has been approved to include a new scheme with a budget of £40k into the 2017/18 Capital Programme.  This is funded through a virement from the Education Asset Renewal Contingency budget.  The boiler flues at Ysgol Iolo Morgannwg have been reported as being non-compliant.  Works will consist of replacing the boilers and flues to meet current regulations and will take 3 weeks to complete.
16. Fairfield Nursery Adaptions - Due to unforeseen issues and a change of use to the building, additional works were required to comply with current Building Regulations.  It has therefore been requested that this budget is increased by £3k to be funded by a contribution from the Education revenue budget.
17. St Cyres Lower School Marketing & Disposal - The Council will not legally complete on this sale until 2018/19.  The marketing agent's fee is not payable until legal completion; it has therefore been requested to carry forward £30k into the 2018/19 Capital Programme.
18. Eagleswell Marketing & Disposal - The Council will not legally complete on this sale in 2017/18.  The marketing agent's fee is not payable until legal completion; it has therefore been requested to carry forward £15k into the 2018/19 Capital Programme.
19. St. Cyres Comprehensive Grounds Maintenance Store - It has been requested to increase this scheme budget by £3k for additional works to extend a gateway.  This is to be funded £1.5k from the Schools Rationalisation Reserve and £1.5k revenue contribution from the School.
20. Ysgol Dewi Sant, Llantwit Major - This scheme is complete and the account has been finalised.  There is an underspend of £21k and it has therefore been requested to vire £21k into the Education Asset Renewal Contingency Budget.
21. Modular Building Resiting Ysgol Dewi Sant - This scheme is complete and the account has been finalised.  There is an underspend of £55k and it has therefore been requested to vire £55k into the Education Asset Renewal Contingency Budget.
22. Asbestos Removal - Due to capacity the total budget of £27k will not be spent this financial year, it has been requested that £8k is carried forward into the 2018/19 Capital Programme.

Resource Implications (Financial and Employment)

23. As detailed in the body of the report.

Sustainability and Climate Change Implications

24. As detailed in the body of the report.

Legal Implications (to Include Human Rights Implications)

25. There are no legal implications.

Crime and Disorder Implications

26. There are no crime and disorder implications.

Equal Opportunities Implications (to include Welsh Language issues)

27. There are no equal opportunity implications.

Corporate/Service Objectives

28. 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

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

Consultation (including Ward Member Consultation)

30. 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

Officers Consulted

Head of Strategy, Community Learning & Resources

Responsible Officer:

Paula Ham

Director of Learning and Skills