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Agenda Item No

 

The Vale of Glamorgan Council

 

Scrutiny Committee (Corporate Resources): 21st February 2012

 

Report of the Director of Finance, ICT and Property

 

Revenue Monitoring for the period 1st April 2011 to 31st December 2011

 

Purpose of the Report

1.             To advise Scrutiny Committee of the progress of revenue expenditure for the period 1st April, 2011 to 31st, December, 2011.

Recommendations

1.             That the position with regard to the Authority’s 2011/12 amended Revenue Budget be noted. 

2.             The Director of Social Services take the necessary action to bring expenditure in line with the base budget.  

Reasons for the Recommendations

1.             That the Members are aware of the projected revenue outturn for 2011/12.

2.             To bring Social Services expenditure in line with the base budget

Background

2.             Cabinet on the 16th November 2011 (minute no C1511 and C1512 respectively) approved the amended Revenue Budget and Housing Revenue Account budget for 2011/12. The Budget information is subdivided by Cabinet Members’ portfolio within each Directorate. Reports monitoring expenditure are brought to this Committee on a regular basis.

Relevant Issues and Options

3.             The projected outturn for the 2011/12 Revenue Budget is shown in comparison with the amended Revenue Budget at Appendix ‘1'. The forecast is for a balanced Council Revenue Budget.

4.             The forecast is for an estimated balanced budget on the Housing Revenue Account.

5.             Economic Development and Leisure – the anticipated overspend on the service has increased by £250k to £670k due to the delay in the implementation of the Leisure Centre Partnership. The increase of £250k will be met from Policy savings.

6.             Children and Young People's Services - The projected overspend position for this service is £1.25m.  An analysis of this position is shown in the table below.  This overspend can be offset by a Children’s Services provision of £210k resulting in £1.04m of savings to be found by the service this financial year.

Area Of Spend

£000

Note

Childrens Placement

1,144

There is an increased number of high cost placements

Foster Carers

157

Increased payments to Foster Carers due to the introduction of the National Minimum Allowance for Foster Carers by the Welsh Government, which came into force from April 2011

Reduced Recharge from Service Strategy

(50)

An underspend on Service Strategy will result in a reduced recharge to Childrens Services

GROSS DEFICIT

1,251

 

Use of Provisions

(210)

 

NET DEFICIT

1,041

 

 

7.             Adult Services - The projected overspend position for this service is £2.32m.  An analysis of this position is shown in the table below.  This overspend can be offset by an Adult Services provision of £465k, resulting in £1.86m of savings to be found by the service this financial year.  The position has improved from the previous month as a result of savings being made from the continuing negotiations relating to the Learning Difficulties Supported Housing contracts and the receipt of increased income relating to Community Care packages.

Area Of Spend

£000

Note

Care Home Fees

506

An increase in fees required to pay Care Homes over and above the 2% inflation already included in the budget

2011/12 Savings

447

Savings identified for the year but not being achieved (as detailed in November's monitoring report)

Community Care Packages

1,586

As a result of increased demand

First Steps

634

Due to the introduction by the Welsh Government of the First Steps Improvement Package Initiative which introduced a £50 per week charge cap for non residential services.  This is the difference between the loss calculated to the Authority from the sample week (£1.007m) and the transfer into the RSG (£373k)

Temporary underspends within Adult Services budget

 

(401)

This includes staff vacancies which will be filled or used as cost savings in 2012/13 and the estimated April 2011 pay award for employees earning less than £21,000 which did not materialise 

Continuous underspends within Adult Services budget

(342)

This includes staff vacancies and other underspends that can be retained

Reduced Recharge from Service Strategy

(106)

An underspend on Service Strategy will result in a reduced recharge to Adult Services

GROSS DEFICIT

2,324

 

Use of Provisions

(465)

 

NET DEFICIT

1,859

 

 

8.             Service Strategy – This budget is anticipated to outturn on target.

9.             Overall, it is projected that the Social Services budget as a whole could overspend by £3.57m this year.  There are provisions available to offset this position to the value of £675k resulting in a net overspend of £2.9m.  There are considerable pressures on both Children's and Adult Services from increasing demand, new requirements from the Welsh Government for which adequate funding has not been received and the need to achieve budget savings.  While the position has improved this month by £248k, it should be noted that the overspend on Community Care packages could increase further by year end if the value of additional packages approved exceed the value of packages that reduce.  

10.        The Director of Social Services needs to take immediate action to curtail overspending within this Directorate.  The Directorate is committed to reducing this overspend and a Budget Action Recovery Plan has been presented to Cabinet.  It is essential that the Budget Action Recovery Plan is refined so that it demonstrates a viable plan to bring spending back to the base budget.  A multi-disciplinary project team and project board have been set up to further develop the Plan and oversee and facilitate its delivery. Regular progress reports will be presented to Cabinet.

11.        Policy – additional savings of £250k from the existing Policy budget will be used to fund the overspend on Leisure Services.

12.        For Other Services, out turn will be as previously reported.

Resource Implications (Financial and Employment and Climate Change, if appropriate)

13.        As detailed in the body of the report.

Legal Implications (to Include Human Rights Implications)

14.        There are no legal implications.

Crime and Disorder Implications

15.        There are no crime and disorder implications.

Equal Opportunities Implications (to include Welsh Language issues)

16.        There are no equal opportunity implications.

Corporate/Service Objectives

17.        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

18.        This report is not contrary to the Policy Framework and Budget.

Consultation (including Ward Member Consultation)

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

Background Papers

None.

 

Contact Officer

Robert Ingram (Principal Accountant) (01446 709252)

 

Officers Consulted

The Directors of Learning and Development, Environment and Economic Regeneration and Legal, Public Protection and Housing Services and Social Services have been consulted on the contents of this report.

 

Responsible Officer:

Sian Davies, Director of Finance, ICT and Property

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