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Agenda Item No

The Vale of Glamorgan Council

Cabinet Meeting: 23 February, 2015

Report of the Leader

Revenue Monitoring for the period 1st April 2014 to 31st December 2014

 

Purpose of the Report

1. To advise Cabinet of the progress relating to revenue expenditure for the period 1st April 2014 to 31st December 2014.

Recommendations

1. That the position with regard to the Authority’s 2014/15 Revenue Budget be noted.

Reasons for the Recommendations

1. To advise members of the projected revenue outturn for 2014/15.

 

 

Background

2. Cabinet on the 17th November 2014 (minute nos. C2533 and C2532 respectively) approved the amended Revenue and Housing Revenue Account Budgets for 2014/15. The Budget information is subdivided by cabinet members’ portfolio within each Directorate. Reports monitoring expenditure are brought to Cabinet on a regular basis.

 

 

Relevant Issues and Options

3. The forecast for the 2014/15 revenue budget is for a favourable variance of £715k.

4. The Housing Revenue Account budget for 2014/15 is forecast to outturn on target.

 

 

 

 


Directorate/Service

2014/15

2014/15

Variance


Amended

Original Budget

Projected

Outturn

(+) Fav

(-) Adv


£'000 

£'000 

£'000

Learning and Skills




Education and Schools 

93,691

93,691

0

Libraries

 2,550

2,550

0

Adult Community Learning 

247

247

0

Youth Service 

1,069

1,069

0

Catering 

1,775

1,775

0

Social Services




Children and Young People 

14,240

13,740

(+)500

Adult Services 

36,512

37,112

(-)600

Business Management and Innovation 

301

301

0

Youth Offending Service 

653

653

0

Visible Services and Housing




Environment and Visible Services 

18,183

18,083

(+)100

Parks and Grounds Maintenance 

3,564

3,564

0

Building Services 

0

100

(-100)

General Fund Housing 

1,438

1,438

0

Public Sector Housing 

3,514

3,514

0

Development 




Public Protection 

2,489

2,489

0

Private Housing 

11,091

11,091

0

Planning and Transportation 

5,158

5,158

0

Leisure 

3,526

3,526

0

Economic Development 

833

833

0

Managing Director 




Resources 

(21)

(21)

0

Corporate and Customer Services 

49

49

0

General Policy 

19,483

18,668

(+)815

Total 

220,345

219,630

(+)715

Met from General Reserve 

-2,500

-2,500

0

Grand Total 

217,845

217,130

(+)715

5. A comparison between the profiled budgets and actual expenditure for the year to date is as follows:

 

Individual Profiled Budgets compared to Overall Total Profiled Budget as at 31st December 2014, also expressed as a %

 


Directorate

Profiled Budget

£’000

Percentage

Learning and Skills

74,499

45%

Social Services

38,456

23%

Visible Services and Housing

19,282

12%

Development

18,568

11%

Managing Director

-10

0%

Corporate and Customer Services

35

0%

General Policy

14,612

9%

 

 

Comparison of Individual Actual Spend compared to Overall Total Actual Spend as at 31st December 2014, also expressed as a %


Directorate

Actual Spend

£’000

Percentage

Learning and Skills

74,282

45%

Social Services

38,531

24%

Visible Services and Housing

18,281

11%

Development

18,097

11%

Managing Director

-10

0%

Corporate and Customer Services

35

0%

General Policy

14,001

9%

 

 

Learning and Skills

6. It is projected that by year-end there will be an underspend of £288k.  It is proposed that at year-end, any underspend will be transferred into the Libraries reserve to assist with the implementation of the Libraries review.  Provision has been made within the budget to make unsupported borrowing repayments in relation to the Schools Investment Programme of £435k per annum.

 

7. Schools - The delegated budget relating to schools is expected to balance as any under/over spend is carried forward by schools.

 

8. School Improvement & Inclusion - It is anticipated that this area will overspend by £37k after offsetting adverse variances on the internal respite provision of £50k, recoupment income of £38k and behaviour support of £22k with favourable variances on Additional Learning Needs staffing and resources of £73k.  Any overspend at year-end will be off set by underspends elsewhere in the Directorate.

 

9. Service Strategy & Regulation - This service will outturn with a favourable variance of £13k due to efficiencies within the Business Support section.  It is intended that any underspend at year end will be transferred into the Libraries reserve to assist with the implementation of the Libraries' Review.

 

10. Strategic & Resources  - It is anticipated that this area will underspend by £189k after funding overspends  on urgent repairs in schools of £69k and Special Education Needs transport of £10k, offset by favourable variances on mainstream transport of £143k, independent nursery placements of £36k, staffing of £44k and non-delegated schools costs of £45k.  It is intended that any underspend at year end will be transferred into the Libraries reserve to assist with the implementation of the Libraries Review.

 

11. Children and Young Peoples Partnership– It is anticipated that this service will underspend by £60k due to 2015/16 savings being implemented early and temporary changes to the funding of childcare umbrella groups.  It is intended that any underspend at year-end will be transferred into the Libraries reserve to assist with the implementation of the Libraries' Review.

 

12. £164k will be transferred into the Early Retirement Voluntary Redundancy 'Invest to Save' reserve in respect of the schools early retirement and voluntary redundancy scheme. In addition a transfer of £196k will be taken from the schools Long Term Sickness and Maternity reserve to fund the current year deficit on the scheme.

 

13. Libraries - The service is projecting a favourable variance of £63k due to staff vacancies.  It is intended that any underspend will be transferred into the Libraries' reserve to assist with the implementation of the Libraries Review.

 

14. Youth Service - It is anticipated that this service will outturn on target after transferring £107k from the Youth Service reserve to fund the Area 41 dilapidation costs, Westhouse surrender payment and the Youth Engagement and Progression Framework in schools.

 

15. Adult Community Education - This service will outturn at revised budget after transferring £62k from reserves to assist with funding reductions from Welsh Government and Cardiff and Vale Colleges.

 

16. Catering - The Catering Client will outturn on target after a transfer of £44k from the Catering reserve.  There are projected underspends on the breakfast club of £43k, Appetite for Life Coordination of £15k, Premise Costs of £20k and revenue costs for the new catering system of £26k.  These underspends have been reinvested into the service to fund kitchen equipment in schools.  The transfer from the reserve has been used for the same purpose.  The trading account is predicting a surplus of £50k which will be transferred to fund capital i.e. the cost of the cashless catering system.

Social Services

17. The current year end forecast for the Social Services budget is an overspend of £100k. 

 

18. Children and Young People's Services - This service is currently anticipated to outturn £500k (3.5%) under the Children's Services budget at year-end.  The major issue concerning this service continues to be the pressure on the children’s placements budget.  However, it is currently projected that the Joint Budget for Residential Placements for Looked After Children could outturn with a £100k underspend at year-end.  Work has been ongoing to ensure that children are placed in the most appropriate and cost effective placements, however, it should be noted that due to the high cost of such placements, the outturn  position could fluctuate.  There are potential underspends elsewhere in Children's Services relating to team budgets of £86k, £50k relating to administrative staff, £50k on legal expenses, £60k due to additional adoption income and £154k on alternative means of provision and accommodation costs required for the current cohort of children. 

 

19. Adult Services - This service is currently anticipated to outturn £600k (1.6%) over the Adult Services budget at year end.  This is due to a projected overspend of £800k (3.4%) against the Community Care Packages budget.  This is as a result of increased demand for services, particularly for frail older clients.  While the overspend this year has reduced, pressure on this budget will continue into the next financial year as the full year effect of current packages results in a predicted increase in expenditure of around £1m. The service will strive to manage demand, which will be supported by the reorganisation of the Care Management Team and the implementation of changes as a result of the Intermediate Care Fund (ICF) and Regional Care Fund (RCF) schemes.  The annual deferred income budget for 2014/15 has been set at £725k.  At 31st December 2014 income received to date is on target, however, there are a number of properties that are sold subject to contract, but the anticipated income from these is not high and therefore the year end projection has been maintained at a £100k underrecovery.  This position is included as part of the projected overspend on the Community Care packages budget.  There are potential underspends elsewhere in Adults Services of around £200k which could be used to offset this position.  These areas are £125k on staffing, £26k on transport, £29k on premises and £20k on supplies and services. 

 

20. The ICF grant is only available in 2014/15, however, a cost pressure has been submitted for consideration as part of the 2015/16 budget process to allow for a transitional period for schemes to be evaluated.  The RCF grant has been approved for 2015/16, however, the amount available is 46% less than previously indicated by Welsh Government.  The funding covers 5 schemes across the collaborative region of Cardiff and the Vale.  The proposal for the revised allocation to schemes has been submitted to Welsh Government for consideration.  The allocation of grant to schemes, has been based on priorities and the availability of other funding sources and therefore the reduction has not been consistently applied across all schemes. 

 

21. Cabinet on 22nd September 2014 were advised that the projected overspend for Social Services for the year would be £800k.  Minute number c2462 recommended "T H A T the Director of Social Services make every effort to reduce the level of the overspend by the year end and reports back to Cabinet with the measures to be taken".  Monitoring reports are referred to Cabinet on a regular basis throughout the year.  The projected overspend for the year has reduced and is now anticipated to be £100k.  As stated above, the Service is reviewing ways of managing demand through staff reorganisation and the introduction of new methods of working.  The Social Services Directorate is committed to achieving a balanced budget in 2014/15 and will continue to strive to improve the position further.

Visible Services and Housing Services

22. It is currently projected that overall services under this Committee will outturn within target at year end.

 

23. Highways Maintenance & Highways Maintenance & Engineering Design & Procurement - There is currently a favourable variance of £210k to the amended profiled budget. As previously highlighted, this budget has had pressures due to car parking income being significantly less than budgeted, street lighting energy costs which are higher than budgeted and also pressures on the budget for routine maintenance of potholes. However, these pressures have been offset by a one off transfer of budget of £350k from central policy and also an underspend on a central energy recharge budget of £460k. Works to be undertaken during the winter period will reduce the current variance, however, it is projected that the budget can be managed to achieve an underspend at year end of £100k, covering the projected overspend identified in Building Services.

 

24. Waste Management - There is currently an adverse variance of £33k to the amended profiled budget. As previously reported there is still a slight overspend on vehicle costs, however, vehicles have now been identified via the vehicle telemetry reports that can be disposed, which will reduce costs towards the end of the financial year. It is currently projected that this budget will out-turn on target, however, this could alter depending on the availability of the Viridor plant for waste disposal. During the interim contract stage the plant can close for testing/maintenance with waste having to be diverted to landfill which will add an additional cost burden to the Council.

 

25. Grounds Maintenance - There is currently an adverse variance of £24k to the amended profiled budget. There is an overspend on vehicle costs, however, vehicles have again been identified for disposal over the coming months. It is therefore currently projected that the budget will out-turn on target.

 

26. Support Services - There is currently a nil variance to the profiled budget. This budget now includes the budget for Emergency Planning which was transferred from Public Protection.

 

27. Building Services - At this stage, it is currently anticipated that the Building Cleaning and Security trading unit will out-turn with a deficit of £100k at year-end. The main reason for this is the pay award that was recently agreed for all staff. The pay award was more favourable to lower paid staff and was considerably more than the 1% that had previously been budgeted for. The majority of the clients for Building Cleaning & Security pay an annual fixed amount, therefore, it would be unfair at this stage to increase the charges to clients.

 

28. General Fund Housing - There is currently a £346k underspend against profiled budget due to the savings being made on the use of Temporary Accommodation for the homeless. If the current trend continues, it is anticipated that the General Fund Housing budget will outturn at around £390k underspent.  Due to uncertain pressures going forward, it is proposed that any underspend at year end be set aside to fund homelessness issues in future years.

 

29. Public Sector Housing (HRA) - The HRA budgets have been amended to allow for any in year underspends to be utilised on fire risk assessments and resulting remedial works within the Council's blocks of flats and resurfacing of highways on Housing land.  To allow effective management of the budget, £251,000 for highway resurfacing on Housing land has been moved to the capital Housing Improvement Programme, via Capital Expenditure from Revenue Account (CERA) and £300,000 for Fire Risk Assessments and associated works has been vired to the Housing Repairs budget to form part of the planned maintenance programme.  In addition there has been a transfer of £54,000 from the Housing Repairs Budget to the Housing Improvement Programme via CERA to allow completion of WHQS elements at Redlands House.  Any further underspends will be used to fund the Housing Investment Programme and thereby reduce the requirement for Prudential Borrowing in 2014/15.

Development Services

30. It is currently projected that services under this Committee will outturn within target at year end.

 

31. Public Protection - There is currently a favourable variance of £13k to the profiled budget. Income for the division is still ahead of profile, as has previously been advised. The rate has slowed during December however, it is still anticipated that the service will outturn on target by year-end.   Members are reminded that the Emergency Planning section has been transferred to Visible Services & Housing, as of 1st November 2014.

 

32. Private Sector Housing - There is currently a favourable variance to the profiled budget of £18k for this service. There has been additional income from management fees for Disabled Facilities Grants (DFG's) due to additional capital works being completed this year.  This is offset by lower than anticipated income from the Renewal Area, as the works in the Upper Holton Road Commercial Area require a contribution from property owners which has had an effect on the take-up of the works. Though the situation is improving and works are about to start on site, there could be a lower than budgeted fee income for the Renewal Area team. It is however expected that the service will still outturn on target by year-end.

 

33. Planning & Transportation - There is currently a favourable variance of £234k to the profiled budget.  This is mainly due to a higher than anticipated level of planning and section 106 fee income received during the year. Although there is an anticipated underspend within this division at year-end, it has been agreed that any such underspend will be used to fund capital regeneration schemes for the Authority hence the forecast is for a balanced budget at year-end.

 

34. Leisure - There is currently a favourable variance of £97k to profiled budget. This is due mainly to an underspend on the central energy recharge to Leisure Centres, as well as vacant posts within the Countryside division being held pending the now concluding restructure within the Division. There are however planned repairs works within the Countryside Division that are yet to be undertaken which will reduce the underspend.  Any residual underspend will be used towards any overspend in the Economic Development Division or contribute towards the capital regeneration schemes thus resulting in a balanced budget at year end

 

35. Economic Development - There is currently a favourable variance of £109k to the amended profiled budget. This is mainly due to an underspend on profiled repairs budgets. However, major repairs at a cost of around £132k are due to be undertaken on our workshop stock to introduce emergency lighting, as well as handrails on flat roofs, in line with health & safety advice.  Improving the condition of the stock will attract business investment.  It is hoped that these works can be completed by the end of this financial year and contained within the existing Economic Development budget, but, should it exceed the available budget, any excess will be funded from other underspends within the Development Services Directorate.

 

36. Other services are anticipated to outturn on target by year end. 

Managing Director

37. General Policy - The forecast is for a favourable variance of £815k as at the year end. This has arisen from a reduction in capital charges £715k and an increase in external interest receivable of £100k.

 

38. All other services are estimated to outturn on budget.

2014/15 Savings Targets

39. Attached at Appendix 1 of the report is a statement showing the progress made to date against all services 2014/15 savings targets.

 

 

Resource Implications (Financial and Employment)

40. As detailed in the body of the report.

Sustainability and Climate Change Implications

41. As detailed in the body of the report.

Legal Implications (to Include Human Rights Implications)

42. There are no legal implications.

Crime and Disorder Implications

43. There are no crime and disorder implications.

Equal Opportunities Implications (to include Welsh Language issues)

44. There are no equal opportunity implications.

Corporate/Service Objectives

45. 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

46. This is a matter for Executive decision.

Consultation (including Ward Member Consultation)

47. Each Scrutiny Committee will receive a monitoring report on their respective areas. This report does not require Ward Member consultation.

Relevant Scrutiny Committee

48. All

Background Papers

None

 

 

Contact Officer

Robert Ingram (Principal Accountant) (01446 709252)

 

 

Officers Consulted

All Directors

 

 

Responsible Officer:

Sian Davies, Managing Director  

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