Agenda item

July Financial Monitoring 2021/22

Cabinet Portfolio: - Corporate Services, Community Safety and Finance


Strategic Directorate: - Finance and Customer Services


Consideration was given to a report that was submitted for pre-decision scrutiny ahead of the Cabinet meeting scheduled for 19 July 2021 that detailed the Council’s financial position as at the end of July 2021 based on actual cost and income figures for the first four months of 2021/22. It was noted that the report was the second of a series of financial monitoring reports for the current financial year. The Cabinet Member for Corporate Services, Community Safety and Finance, the Assistant Director - Financial Services and the Head of Corporate Finance attended the meeting to present the report.


The report stated that as of July 2021 the Council was expecting to deliver the overall outturn within budget for the financial year 2021/22. It was noted that while the Directorates had a current forecast year end overspend of £7.2m on General Fund expenditure that this should be mitigated by the Government’s provision of COVID-19 emergency support grants and Sales, Fees and Charges Income Compensation. It was noted that the longer-term impacts of Covid-19, public health measures and the pace at which services could return to normal was unknown and as such the financial situation in the short to medium term would continue to be surrounded by a degree of uncertainty.


The report provided a detailed narrative for the budget position of each directorate. The report also provided information on the delivery of previously agreed savings, the position of the Housing Revenue Account, the Covid-19 Local Support Scheme, and the delivery of the Capital Programme.


Members asked for further information on the activities that were being carried out in order to return the management and operation of the Council’s finances to a more “business as usual” position. The Assistant Director - Financial Services advised that the production of the Council’s new Medium-Term Financial Strategy that would be considered by Cabinet in November 2021 would address many of the financial challenges that the Council faced as the Borough emerged from the pandemic.


The Assistant Director advised that it had been confirmed that the results of the three-year Government spending review would be known on 27 October, with details of the Local Government Financial Settlement following later in the year. The Assistant Director noted that it was hoped that the Financial Settlement would mirror the Spending Review in being for a period of three years. The Assistant Director also noted that work around Council Tax and Business Rates collection rates and driving the delivery of previously agreed savings was also being carried out in order to enable effective budget management and planning in future years.


Members sought assurance that the Council’s finances and the administration of the numerous Government grants to support the Council’s finances during the pandemic had been managed as efficiently and effectively as possible during the period of the pandemic. The Assistant Director assured members that the budget reporting processes required both internally and by the MHCLG had been followed stringently throughout the pandemic and noted that the positive financial outturns seen by the Council in recent years showed how effectively budgets had consistently been managed.


Members sought clarification on the impact and use of “vacancy management” in delivering balanced budgets across the Council, noting the use of the term in the officer’s report. The Assistant Director advised that “vacancy management” could be seen as a slightly misleading term and assured members that it was never planned to run services with fewer staff than were required and budgeted for, but that savings created by natural staff turnover and subsequent short periods where a post may be vacant needed to be accounted for and were as such recorded under “vacancy management”. The Assistant Director agreed that as the term appeared to be somewhat misleading in what it referred to that consideration would be given to how such savings were referred to in future reports.


Members noted the projected overspend of the Children’s and Young Peoples Services budget and asked whether there would be any further financial support from the Government to support the ongoing costs faced by the Council relating to Operation Stovewood. The Cabinet Member - Corporate Services, Community Safety and Finance assured members that the Council was in constant and ongoing discussions with the Government regarding the further financial support for Operation Stovewood.


Members noted their concern regarding the current budget overspends and how these had been impacted by the pandemic. Members stated that this was particularly frustrating given how well that the Council had been performing with regard effective service delivery, good budget management and in the identification and delivery of savings before the pandemic had started.


Members noted the ongoing budgetary pressures linked to the pandemic in the Regeneration and Environment directorate and asked for further information on where specific budgetary pressures were still being felt. The Assistant Director advised that this information would be collated and circulated to members. The Assistant Director noted that due to the many variable and unknown factors related to the pandemic, such as the speed of the economic recovery and the long-term impact of restrictions that there was still huge amounts of uncertainty regarding the financial position of the Council moving forwards. Members asked whether the grants received to replace lost income from leisure and recreation services were sufficient to offset the income that had been lost. The Assistant Director advised that while the grants received had been very welcome, they had now ended and as such leisure and recreation services would continue to face budget pressures as the impact of the pandemic continued to be felt.


The Chair sought assurance regarding the use of agency staff across the Council and asked how closely the use of agency staff and their related costs were monitored. The Assistant Director advised that spending on agency staff was closely monitored by Strategic and Assistant Directors. The Assistant Chief Executive assured the Chair that a group of senior officers oversaw all requests from departments regarding requests for agency staff and noted that the group frequently challenged managers to identify alternative solutions to meet their staffing needs other than taking on agency staff. 


The Chair thanked the Cabinet Member for Corporate Services, Community Safety and Finance, the Assistant Director - Financial Services and the Head of Corporate Finance for attending the meeting and answering member questions.


Resolved:  -


1.    That Cabinet be advised that the recommendations be supported.


2.    That a report be circulated to members of the Overview and Scrutiny Management Board in order to provide members with information and assurance on the specific activities that are being carried out with, and by directorates in order to ensure the timely delivery of previously agreed budgetary savings.

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