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Agenda Item No. 4

 

The Vale of Glamorgan Council

 

Scrutiny Committee (Economy and Environment): 2nd September 2014

 

Joint Report of the Director of Development Services and the Director of Visible Services and Housing

 

Revenue and Capital Monitoring for the period 1st April to 31st July 2014

 

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 2014 regarding those revenue and capital budgets, which form this Committee’s remit.

Recommendation

It is recommended that :-

1.         The position with regard to the 2014/15 revenue and capital monitoring is noted.

Reason for the Recommendation

1.         That Members are aware of the position with regard to the 2014/15 revenue and capital monitoring relevant to this Scrutiny Committee. 

Background

2.         Council on the 5th March 2014 (minute nos. 884 and 883 respectively) approved the Revenue and Capital Budgets for 2014/15.  Reports monitoring expenditure are brought to this Committee on a regular basis.

Relevant Issues and Options

Revenue

 

3.         The Revenue Budget and projected outturn for 2014/15 are shown in the table below.  It is currently projected that services under this Committee will outturn within target at year end, however, this is after the use of reserves.

 

Economy & Environment 

Revenue Budget

 

Probable Outturn

Variance

(+ ) Favourable

(-) Adverse

 

£000

£000

£000

Highways Maintenance & Engineering

 

8,536

9,236

(700)

Waste Management

 

9,376

9,376

0

Grounds Maintenance

 

3,528

3,528

0

Support

 

0

0

0

Building Services

 

0

0

0

Economic Development

 

832

832

0

Leisure

 

3,515

3,515

0

Planning and Transportation

 

5,306

5,306

0

Use of Reserves/Other Identified Savings

0

(700)

700

 

 

 

 

Total Economy & Environment

31,093

31,093

 

0

 

4.         A graph and table setting out the variance between profiled budget and actual expenditure to date is attached at Appendix 1.

5.         Highways Maintenance & Engineering Design & Procurement - There is currently an adverse variance of £77k to the profiled budget. The original budget for 2014/15 takes account of the £165k savings required for this financial year. Progress against these savings is shown in Appendix 4. There are also financial savings from previous years that have not yet been made and are putting pressure on the budget. These savings still to be made relate to street lighting (£150k) and car parking (£340k). Reports will shortly be brought before Cabinet, by the Director of Visible Services and Housing, to set out the proposals for both of these savings. Full year savings will not be made in these areas and due to their size it is proposed that the Visible Services Reserve is used to fund the shortfall.

6.         Waste Management -There is currently an adverse variance of £41k. There are two main reasons for the current overspend.  Firstly, the bulk of the savings in waste management for this financial year related to the more efficient use of the vehicle fleet. Due to a slight delay in the implementation of the vehicle telemetry software, some of the proposed savings have slipped by a few months. However, this is now in place and reports will shortly be run on vehicle utility so that decisions can be taken on vehicles that are under-utilised thus enabling savings to be made.  Secondly, there has been an increase in the cost of the treatment of dry co-mingled recycling due to a new contract being in place from April 2014. Although there is currently an adverse variance to the budget, the interim contract with Viridor for disposal of black bag waste will achieve significant savings compared to the current cost of disposal. The Vale are due to join this contract in November 2014. This should ensure a balanced year end budget. The original budget for 2014/15 takes account of the £1,020k savings required for this financial year which are shown in Appendix 4. The budget will be monitored closely to ensure that efficiency savings that are not made are found elsewhere within the budget.

7.         Grounds Maintenance - There is currently an adverse variance of £50k to the profiled budget. Again, there has been some slippage in the savings relating to transport, however, every effort will be made to ensure that savings are made elsewhere in the department. The original budget for 2014/15 takes account of the £40k savings required for this financial year detailed in Appendix 4. The budget will be monitored closely to ensure these efficiency savings are achieved.

8.         Economic Development - There is currently a favourable variance of £18k to profiled budget.  This is due mainly to higher than anticipated income in the Employment Training Services section although pre-established changes in terms of the JobFit agreement mean that attachment payments are likely to reduce from August 2014 and so the surplus is likely to diminish. The budget is currently expected to outturn on target.

9.         Leisure - There is currently a favourable variance of £35k to profiled budget. This is due mainly to vacant posts within the Countryside division being held pending a restructure within the Division.  However, as it is still early in the financial year the budget is currently expected to outturn on target.

10.      Planning and Transportation - There is currently a favourable variance of £122k to profiled budget. This is due mainly to a higher than anticipated level of fee income received to date. Some additional staffing may be needed to assist with the additional workload within the division and therefore at this stage the budget is still projected to outturn on target. The need for staffing and the manner in which this need could be catered for is currently being addressed.

Capital

11.      Appendix 2 details financial progress on the Capital Programme as at 31st July 2014. 

12.      S106 Schemes - Emergency powers have been used to approve the inclusion of s106 monies into the programme as follows:

The Herberts                                 £13,618

20mph Zone Llandough                 £20,000

13.      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.

14.      Appendix 3 provides non-financial information on capital construction schemes with a budget of over £100k.   Where a budget shown in Appendix 2 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.

Resource Implications (Financial and Employment)

15.      There is provision in the budget this year for increased energy costs.  If these costs do not materialise in year, then the budget could be used to offset the potential overspend.  However, this is only possible in 2014/15 as this budget is earmarked as a saving in future years, as identified in the Medium Term Financial Plan reported to Cabinet on 11th August 2014.

16.      Reserves may be used to cover an overspend on a one off basis, however, they cannot be used on a recurring basis.  If it is known that approved savings will not be achieved, then alternative savings need to be identified as a replacement.

Sustainability and Climate Change Implications

17.      There are no direct implications arising from this report.

Legal Implications (to Include Human Rights Implications)

18.      There are no legal implications.

Crime and Disorder Implications

19.      There are no crime and disorder implications.

Equal Opportunities Implications (to include Welsh Language issues)

20.      There are no equal opportunity implications.

Corporate/Service Objectives

21.      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

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

Consultation (including Ward Member Consultation)

23.      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

Director of Development Services

Director of Visible Services and Housing

 

Responsible Officer:

Rob Thomas

Miles Punter