Agenda item

Agenda item

Budget monitoring - 2015/16 quarter 4

 

 

Background Information

 

The Integrated Performance Report for quarter 4 2015/16 sets out the Council’s financial position at the end of 2015/16 (31 March 2016).  The recommendations in the report were agreed by the City Executive Board on 16 June 2016.

 

Why is it on the agenda?

 

For the Panel to note and comment on the Council’s financial outturn at the end of the 2015/16 financial year.

 

Who has been invited to comment?

 

·         Nigel Kennedy, Head of Financial Services;

·         Anna Winship, Management Accountancy Manager.

 

 

Minutes:

The Management Accountancy Manager introduced the integrated performance report.  She explained that all financial targets had been achieved including efficiency savings and income generation targets.  There was a General Fund under-spend of £0.5m which represented 2% of the gross budget requirement.  The Panel noted that £0.5m was the net underspend after new schemes requests (£0.361m) and slipped schemes (£1.024m), giving a gross under-spend of some £1.879m.  The Panel also noted that a recommendation in the report sought approval for the new bids to negate the need for separate reports to go to the City Executive Board and Council.

 

The Panel heard that the capital outturn position of £33m represented 95% of the latest budget and questioned whether the presentation of this outturn spend was overly positive given that slippage had taken place during the year, including due to a 4-month moratorium on many capital schemes.  The Panel heard that unlike the general fund budget, the capital budget was reviewed and updated every month to take account of variations during the year.  The overall capital budget was a moving target but Officers were well aware of the state of the capital programme.  The outturn position did not come as a surprise and explanation was provided in paragraphs 16-18 of the report.  The Panel also questioned the status of particular line items in the capital programme.

 

The Panel heard that the Housing Revenue Account (HRA) had a £10m underspend which was largely due to revenue contributions to capital not being used due to the moratorium. 

 

The Panel noted that due to the timing of the first panel meeting of the Council year, the recommendations in the report had already been agreed by the City Executive Board.  The Panel agreed that the following observations would be relayed to full Council:

·         That the General Fund under-spend of £0.5m was net of carry forwards and new bids that were not yet agreed and, excluding these, the total under-spend was close to £1.9m;

·         That the under-spend was partly a result of over-achievement against income targets, for which officers should be commended;

·         That the Council’s earmarked reserves had increased significantly over the last year (from £38.7m to £51.4m) and this increase was largely due to slippage in HRA capital projects;

·         That risks to the Council should be reviewed in light of the leave result in the referendum on Brexit (British exit from the European Union).

 

Supporting documents: