Meeting documents

To consider a report by the Cabinet Member for Community and Resources.

The Cabinet considered a report by the Cabinet Member for Communities and Resources which provided the first update of the new financial year, and the national and local issues impacting on the County Council’s finances and covered matters that would need to be taken into account when developing the MTFP in readiness for the transition to the new unitary authority. 

The report also summarised information for consideration by the Audit and Governance Committee on 29 June 2018 related to the 2017/18 outturn, balances at 31 March 2018, and the most recent 2018/19 forecast of outturn.

Cllr Ferrari highlighted the good job on the part of officers in achieving the £0.2m underspend for 2017/18. He also congratulated officers on the achievement of finalising the end of year accounts about a month earlier than in previous years which represented a good piece of work and asked that his thanks be passed on to all financial officers.

To date there was a £3.7m overspend forecasted, with the areas of pressure being in Adults and Children’s Services.  This was still a huge improvement on the previous year and everybody recognised the increased pressures across both of the services.  This remained a risk as they were both demand led services but Cabinet members and officers were working hard to keep it under control.  Cllr Ferrari highlighted recommendation 7 in the report and the use of capital available to make service improvements.  He would therefore be seeking Cabinet approval to transfer £5m into a transformation fund.

Cllr Haynes supported the movement of money through to the transformation fund and felt this was vital in view of the considerable challenges moving forward.  She took the opportunity to highlight that the pressure on the adults budget came predominantly from the market and that the Council was being charged more than other counties.  Cllr Knox, as the Leader of the Council, felt it would be helpful to send out a communications brief to explain exactly what the challenges were.

Cllr Butler noted that Children’s Services were working on the overspends and driving hard to try and bring the pressures down.

Cllr Turner asked that the last sentence from paragraph 7.8 of the report be added to the recommendation in order to be more transparent, which was agreed.

The Chief Financial Officer noted that the financial year was very difficult, but the work across the whole of the County Council needed to be recognised.   Officers would be working again this year to close the budget and the expectation was that there would be a balanced budget by the end of the year.

Resolved

1. That the unaudited outturn position for 2017/18, specifically the financial performance in service Directorates be noted;

2. That the Directors’ early estimates included in the forecast of outturn for the current year be noted;

3. That the latest savings expectations from the Forward Together programme and contribute ideas for short-term and longer-term savings be noted;

4. That the starting position for the current MTFP and budget round including the level and adequacy of balances on the general fund be noted;

5. That any other issues that Cabinet wished to be taken into account in the development of the MTFP and budget be brought forward;

6. That the proposals to increase the current ceiling on the flexible use of capital receipts be agreed;

7.That the transfer of an additional £2.5m into the LGR reserve to provide for future costs of transition be agreed in order to give headroom of £7m to apply from 2018/19. The Government has already acknowledged this nationally, through the extension of the period for flexible receipts usage to 2021-22; and

8. That the risks associated with and impacting upon the financial performance for the current and future financial years be understood.

Reason for Decision

To enable work to continue on refining and managing the County Council’s budget plan for 2017/18 and the overall three-year MTFP period.