Agenda item

Report of the Director of Finance and Resources

The Cabinet considered a report of the Director of Finance and Resources that outlined the final revenue and capital outturn position for 2023/24 and reviewed treasury management activity and 2023/24 Prudential Indicators reported under the Prudential Code for Capital Finance. Appendices to the report provided a detailed breakdown of Directorate Revenue Variations, Capital Programme Changes and Analysis of Rescheduling, and Prudential Indicators.

The overall financial position included the following headline items:

•  An overspend of £1.8m, balanced by a contribution from unearmarked reserves.

•  Capital Programme expenditure of £115.3m

•  A reduction in the level of available Council revenue reserves from £128m to £118m

Further detail within the overall position included:

•  An overspend of £4.9m in Adults’ Social Care reflecting an increased number of high-cost complex cases.

•  An overspend of £4.7m within Streetscene and Regulatory Services representing a reduction in income generation in several areas such as planning applications, car parking in parks and bereavement services as well and pressures within urban forestry due to remedial works on trees. A significant proportion of this pressure was within Waste & Fleet services relating to implementation of HSE recommendations, costs of increased tonnages and increased gate fees, and deficits on planned income in both Commercial Waste and Passenger Transport.

•  An overspend of £2.8m within Childrens’ Services reflecting high placement costs and staffing pressures in Help & Protection (Area Teams) due to high levels of cases which required additional workers and agency staff.

•  An overspend of £2.5m on Housing & Homelessness due to an increase in people seeking support and being placed in temporary accommodation (TA), combined with an increase in TA fees.

•  An underspend of £1.8m in Education & Skills due to management of vacancies within Customer Services, alongside other efficiencies and the utilisation of grant income and earmarked reserves.

•  An overspend of £1.4m on Business, Investment & Culture represented underachievement of sponsorship income and reduced grant from ERDF as well as holding costs for the City Centre Cultural Gateway due to slipped project implementation timescales.

•  An overspend of £1.4m on Transport & Highways relates to increased costs in highways maintenance to address highways defects, as well as continuing high costs of energy for street lighting.

•  The service had experienced pressures in highways maintenance due to the cost of addressing highways defects and income pressures resulting from sickness and recruitment challenges. In addition, the continuing high cost of energy had resulted in pressures in street lighting. These pressures had been partially offset by a recovery in car park income.

•  A net underspend of £12.4m within central budgets, included higher dividend income from Council owned companies, interest income from loans, higher than budgeted investment income, and distribution of Business rates Levy Account Surplus.

The underlying revenue position had improved by £6.7m since Quarter 3 when an overspend of £8.5m was forecast. The majority of the improved position related to increased one-off income within Contingency and Central budgets which were set out in the report. 

The prudent management of the Councils financial position throughout the Covid crisis enabled the Council to retain some resources to manage any legacy issues. £1.8m of this had been used to balance the position at the end of 2023/24. Although the Covid crisis was no longer a significant threat to the Councils service delivery and financial position, the cost-of-living crisis and high levels of inflation had had tangible impacts on demand for both Childrens, Adults and Housing services. The complexity of need, support required and sufficiency of the external market to provide for this had directly impacted the Councils financial outturn reported up to 31st March 2024 and would be an ongoing financial challenge in 2024/25.

RESOLVED that the Cabinet:

1)  Approves the final balanced revenue outturn position after a contribution of £1.8m from reserves.

2)  Approves the resource switch of £5.9m of capital projects funded by revenue to capital receipts, to create the Financial Risk Contingency within Reserves, referenced in Section 2.2.3 of the report.

3)  Approves the final capital expenditure and resourcing position (Section 2.3 and Appendix 2 of the report), incorporating expenditure of £115.3m against a final budget of £137.1m; £21.7m expenditure rescheduled into 2024/25 and £0.1m underspend.

4)  Approves the outturn Prudential Indicators position in Section 2.4.4 and Appendix 3 of the report.

5)  Recommends that Council approves the reserve contribution of £1.8m for the purposes described in Section 5.1 of the report.

6)  Recommends that Council approves the resource switch of £5.9m of capital projects funded by revenue to capital receipts, to create the Financial Risk Contingency within Reserves, referenced in Section 2.2.3 of the report.