Agenda Item No
The Vale of Glamorgan Council
Cabinet Meeting: 23 September, 2013
Report of the Leader
Revenue Monitoring for the period 1st April 2013 to 31st July 2013
Purpose of the Report
1. To advise Committee of the progress of revenue expenditure for the period 1st April, 2013 to 31st July, 2013.
1. That the position with regard to the Authority’s 2013/14 Revenue Budget be noted.
Reasons for the Recommendations
1. That the members are aware of the projected revenue outturn for 2013/14
2. Council on the 6th March 2013 (minute no 943 and 941 respectively) approved the Revenue Budget and Housing Revenue Account budget for 2013/14. 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 out turn for the 2013/14 Revenue Budget is shown in comparison with the Revenue Budget at Appendix ˜1'. Overall, the forecast is for the Council to have a balanced revenue budget.
4. The forecast is for an estimated balanced budget on the Housing Revenue Account.
Learning and Skills
5. The current overall forecast is for a balanced budget.
6. Schools - The delegated budget relating to schools is expected to balance as any under/over spend is carried forward by schools.
7. School Improvement - Currently, there is a £30k overspend projected for year end. It is anticipated that this will be due to overspends of £20k due to the failure to achieve the vacancy provision, additional support required by the School Improvement Service of £13k, additional hours worked in Governor Support of £2k. These costs will be offset by a £5k underspend against subscriptions, as a result of savings against the WJEC subscription.
8. Access and Inclusion -Currently, there is a £30k underspend projected for year end. It is anticipated that there will be an overspend of £56k against Learning Support Assistants, an overspend of £77k against placements that do not fall under the joint funding arrangement. This will be offset by additional recoupment income generated from out of county placements of £186k. Also included within the Access and Inclusion projected outturn is an overspend of £23,000 against the jointly funded budget for Residential Placements for Looked After Children.
9. Provision has been made within the budget for the annual cost of financing the School Investment Strategy of £600,000. This sum will be transferred to the School Investment Strategy Reserve.
10. Education is projecting to transfer £170k to reserves as part of the Voluntary Early Retirement and Redundancy scheme. This is made up of £273k received from schools to repay arrangements made in previous years and £103k required to finance new arrangements under the scheme.
11. Libraries - There is currently a £16k favourable variance against the profiled budget due to staff vacancies, however, this will be utilised within the service during the coming months and the service is therefore anticipated to outturn on target at year end.
12. Youth Service - The service is currently breaking even against the profiled budget and is anticipated to outturn on target at year end.
13. Lifelong Learning - The service is currently breaking even against the profiled budget and is anticipated to outturn on target at year end.
14. Catering - There is currently a £41k favourable variance against the profiled budget. The service can be affected by external factors such as snow closure and the requirement to meet WG nutritional guidelines and therefore it is currently predicted that the budget will outturn on target at year end.
15. The current forecast for Social Services is an overspend at year end of £673k. This is after deducting savings identified for the year of £2.04m.
16. Children and Young People's Services - The major issue here is the need to manage continued pressure on the children's placements budget. The current projected outturn for the jointly funded Residential Placements budget for Looked After Children is an overspend of £232k, while the previously reported position at the end of May was breakeven. The reason for this increase is that one young person moved from a foster placement into a residential placement (£129k) and one young person, who was previously supported at home, became looked after and was accommodated in a residential placement (£128k). It is anticipated currently that this level of overspend can be offset by underspends elsewhere within Children's Services; therefore, a breakeven position is anticipated.
17. Adult Services - The major issue is the continuing pressure on Community Care Packages, the Division's most volatile budget and the one most dependent upon levels of service demand which are not within the Council's direct control. At present, the projected year end position is an overspend of £1.429m but this is after the reduction in budget to accommodate the savings target for the year of £685k. Any additional funding received from Welsh Government for the implementation of the First Steps initiative, which resulted in the introduction of the £50 cap for non residential services, will reduce this overspend. Actions are being taken to review all processes and to address this shortfall. There are potential underspends elsewhere in Adult Services of around £463k which could be used to offset this position, resulting in an overall projected overspend at year end of £966k. The Leader and the Cabinet Member for Adult Services have indicated their intention to raise this issue at the next meeting of the Social Services Budget Group.
18. Areas of savings have been identified this year which are £293k over the required target. This can be used to offset the overspend on Adult Services, resulting in a projected overspend for Social Services at year end of £673k
Visible Services and Housing Services
19. The current overall forecast is for a balanced budget.
20. Highways Maintenance & Engineering Design & Procurement - There is currently a £67k adverse variance to the profiled budget. This is mainly due to the continued pressure on the budget for repairing potholes. The amount of potholes should start reducing during the year due to the ongoing resurfacing works being undertaken and the Big Fill initiative, therefore the overall budget is currently expected to outturn £50k overspent. The original budget for 2013/14 takes account of the savings required. The budget will be monitored closely to ensure these savings are achieved.
21. Waste Management - There is currently a £15k favourable variance to the profiled budget. The saving is mainly linked to vacant posts within the service. The original budget for 2013/14 takes account of the savings required and good progress has already been made to achieve this. There are pressures on the budget which may impact later in the financial year and therefore the budget is currently expected to out-turn on target.
22. Grounds Maintenance - There is currently an £84k adverse variance to the profiled budget. The main reasons for this current overspend is continuing costs at Rhoose Point for which there is no budget and the expiration of grant income from Victoria Park. The original budget for 2013/14 takes account of the savings required. Efforts will be made to reduce the current level of overspend, however, the budget is currently expected to overspend by £50k.
23. Support – There is currently a favourable variance of £36k to the profiled budget. This budget is to be held for any cost pressures within Visible Services that may arise throughout the financial year. Currently, this budget is projected to underspend by £100k at the year end.
24. General Fund Housing - The Housing General Fund is currently showing a favourable variance of £181k, this could potentially increase to £300k by the end of the financial year if the current situation is maintained. The reason for this favourable variance is a reduction in the number of homeless individuals requiring emergency accommodation due to a long term increased focus on prevention by the homeless team. As a result, unit costs have decreased dramatically and only two individuals are currently in B&B accommodation. This change of approach has been supported through an expansion of shared accommodation options within the private sector.
25. However, whilst this success is to be welcomed it is still relatively early in the financial year and the use of the private rented sector has significant risks, particularly as a result of the changes already introduced through Welfare Reform and more significantly the challenges posed by the Universal Credit (payment of Housing / Welfare Benefits to the tenant rather than direct to the landlord). This could have an adverse effect on the availability of future private rental options if the Homeless client group are considered by Landlords to be a risk to guaranteed income or increased homelessness if landlords choose to only let to those in employment. The Council has identified Welfare Reform as a significant risk and mitigation measures are already in place. Officers will continue to closely monitor the situation to keep any adverse effect to a minimum.
26. Public Sector Housing (HRA) - The Housing Revenue Account is currently showing a favourable variance of £218k. There are adverse variances on both income due to voids of £68k and Housing Repairs of £28k. These adverse variances are offset by favourable variance on salaries of £116k due to vacancies in the housing teams, hostel and temporary accommodation running costs of £28k, sheltered accommodation £26k, public sector management £40k, legal fees of £21k, Incentive to Move schemes of £13k, Estate Management of £10k and other net costs £60k. Further works are anticipated to be undertaken between now and the end of the financial year, therefore an outturn on target is projected
27. The current overall forecast is for a balanced budget.
28. Planning and Transportation - There is currently a favourable variance of £66k to the profiled budget. This is due to Highway Development income being in advance of the profiled estimate; however, as it is still early in the year and the receipt of income can be unpredictable, it is projected that the budget will out-turn on target.
29. Leisure - There is currently a favourable variance of £21k to the profiled budget. This is primarily due to employee savings as a result of holding vacant posts pending a restructure. The Rights of Way budget however, is currently behind profile and therefore a year end out-turn on target is projected.
30. Economic Development - There is currently a favourable variance of £20k to profiled budget mainly due to a vacant post not yet being filled. There is however, a slight drop in income at the Vale Enterprise Centre, which will be closely monitored and therefore an out-turn on target is currently projected.
31. All other services are anticipated to out turn on budget.
Resource Implications (Financial and Employment)
32. As detailed in the body of the report. The Social Services overspend of £673k will be funded from the Social Services Fund.
Sustainability and Climate Change Implications
33. As detailed in the body of the report
Legal Implications (to Include Human Rights Implications)
34. There are no legal implications
Crime and Disorder Implications
35. There are no crime and disorder implications
Equal Opportunities Implications (to include Welsh Language issues)
36. There are no equal opportunity implications
37. 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
38. This report is for Executive decision.
Consultation (including Ward Member Consultation)
39. Each Scrutiny Committee will receive a monitoring report on their respective areas. This report does not require Ward Member consultation.
Relevant Scrutiny Committee
Background Papers - None
Robert Ingram (Principal Accountant) (01446 709252)
Chief Learning and Skills officer, Directors of Social Services, Visible Services and Housing, Development Services and Resources.
Sian Davies Managing Director