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Agenda Item No 8

 

The Vale of Glamorgan Council

 

Scrutiny Committee (Economy and Environment): 7th October 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 August 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 August 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

 

8,886

9,236

(350)

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

(350)

350

 

 

 

 

Total Economy & Environment

31,443

31,443

 

                       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 £86k 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 still financial savings from previous years that have not yet been made and are putting pressure on the budget. The savings still to be made are for street lighting (£150k) and car parking (£340k). Reports will shortly be brought before Cabinet to set out the proposals for both of these savings. The full year saving will not be made in these areas. In addition to these pressures there is also a significant pressure on the budget for pot-holes with an anticipated overspend of £327k. There are however underspends anticipated elsewhere within the service which can be used to partially offset these overspends and in addition, Cabinet on 22nd September  2014, approved a virement of £350k to the Visible Services budget from General Policy to assist in addressing the projected overspend. It is therefore anticipated that there will now be a £350k overspend at year end.  The Director of Housing and Visible Services is in the process of identifying savings from elsewhere within the service to cover this shortfall.

6.         Waste Management - There is currently an adverse variance of £49k. The 2 main reasons are a slight delay with the implementation of the vehicle telemetry software and an increased cost for treatment of dry co-mingled recycling. The vehicle telemetry 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 to enable savings to be made. To offset these overspends, the interim contract with Viridor for disposal of black bag waste will achieve significant savings compared to the current cost of disposal. The Vale is 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. Although some savings identified in Appendix 4 will not be fully made the savings from the interim contract described above will offset these.

7.         Grounds Maintenance - There is currently an adverse variance of £77k to the profiled budget. The main area of budget pressure is for maintaining areas such as Rhoose Point for which there is no budget. Again there has also been some slippage in the savings related 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 and are detailed in Appendix 4.

8.         Economic Development - There is currently a favourable variance of £35k 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 therefore the surplus is likely to diminish. The budget is currently expected to outturn on target.

9.         Leisure  - There is currently a favourable variance of £54k to profiled budget. This is due mainly to vacant posts within the Countryside division being held pending a restructure within the Division. At this stage however the budget is currently expected to outturn on target.

10.      Planning & Transportation - There is currently a favourable variance of £144k to profiled budget. This is due mainly to a higher than anticipated level of fee income received early in the year, although this has slowed in recent months. A rationalisation of budgets will be undertaken shortly to address the issue and to re-align budgets to service priorities and therefore at this point an outturn on target is anticipated.

Capital

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

12.      S106 Paget Road to Penarth Portway Woodland Path - Following the completion of the required consultation process, it has been agreed that up to £40k of the Penarth Heights s106 monies can be used to re-establish the footpath link between Paget Road and Penarth Marina. Cabinet will be requested to approve the inclusion of this scheme in the Capital Programme.

13.      Barry Island Light Art Commission - The Arts Council of Wales has approved grant funding of £50k for an artist designed lighting scheme in the ceiling of Eastern Shelter, Barry Island.  Cabinet will be requested to approve the inclusion of this scheme in the Capital Programme

14.      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.

15.      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.

Variance between Actual Spend to date and Profiled Spend

16.      Cabinet have previously agreed that further information would be provided where schemes have a value of over £500k and show a variance of 20% or more between actual spend and the profile. The following schemes meet this criteria.

17.      Local Road Network Improvements - This scheme has been subject to delay this financial year however £200k has been committed during September and full spend is still projected this financial year

Resource Implications (Financial and Employment)

18.      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.

19.      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

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

Legal Implications (to Include Human Rights Implications)

21.      There are no legal implications.

Crime and Disorder Implications

22.      There are no crime and disorder implications.

Equal Opportunities Implications (to include Welsh Language issues)

23.      There are no equal opportunity implications.

Corporate/Service Objectives

24.      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

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

Consultation (including Ward Member Consultation)

26.      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

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