Agenda item

Report number HOF204 by the Head of Finance.                          (Enclosure)

Report number HOF204 provided a summary of the Council’s financial position at the end of the first quarter. The Head of Finance highlighted the key variances noted in the report.

General Fund Revenue Budget

·         Public events celebrating the Olympic torch relay were funded from priority reserves

·         Market rights in Grantham had been renegotiated, providing a £5k saving a year for the next three years.

·         Income from development management and land charges was ahead of the budgeted position for the first quarter

·         Take up for the green waste scheme was budgeted at 50%, however 85% of former customers had opted to participate in the scheme

·         Building control income was down against the budgeted position for the first quarter

·         The workforce efficiency target for the General Fund was forecast to be achieved by the end of the financial year

One Councillor queried the year to date budget, the net spend to date budget and the forecast outturn for Finance. The Head of Finance explained that the net spend to date exceeded budgeted levels because of a time lag between the payment of benefits to recipients and reimbursement from government. Councillors requested the addition of a note explaining this.

Action Point:

·         The table showing the General Fund Revenue Summary should include a column showing year to date variance

·         Councillors asked for further information on an additional income stream identified for street cleaning in Stamford which was referred to in the report (para 3.5)

·         Add a note to the General Fund Revenue Budget to explain the variance in respect of benefit payments

Housing Revenue Account

·         Nothing significant of note

·         The workforce efficiency target was forecast to be achieved by the end of the financial year

·         There was a forecast underspend due to vacancies within the area

General Fund Capital Programme

·         The timescales for the Business Innovation Centre/Station Approach schemes had been altered so the majority of the spend would occur in 2013/14

·         The outturn for the shop front scheme was reduced to meet demand

·         There were two variances in respect of street scene services as a result of purchasing two new vehicles

·         An overspend was forecast for Bourne Community Access Point, which would be partly financed by set-asides from 2011/12 underspends

Housing Revenue Account Capital Programme

·         The forecast outturn for refurbishment works in Barrowby was reduced following initial tender prices that were lower than anticipated

·         The refurbishment of 2 large historic voids in 2012/13 had led to an overspend

·         A saving was achieved as budget for a helpline software system upgrade was not required following the transfer of the call centre operation

The Head of Finance also advised members that the headcount was under the budgeted figure (601.7FTE against 626.1FTE) and that collection performance was on target.

PDG members were also provided with a summary of the outturn for 2011/12.

General Fund Revenue Account

The General Fund Revenue Account showed a small underspend. Key variances were highlighted:

·         Savings were achieved through the renegotiation of the grounds maintenance contract

·         Car parking in Stamford achieved greater income than budgeted

·         Stamford markets achieved greater than budgeted income, whereas projections for Grantham were not met

·         Neither Provision within the 2011/12 budget for an ‘invest to save’ reserve and a reserve which allowed provision for any pay settlement were used. The full amount was returned to general reserves

·         The building control account returned a trading deficit of £34k which had created a negative building control reserve

·         The key variance in the finance service area was a result of changes in respect of the International Financial Reporting Standards. This was a notional cost which was the result of the changes to pension liability

Housing Revenue Account

·         The HRA showed a surplus of £1.284m

·         Performance improved in respect of dwelling rent income

·         There was an underspend against the repairs and maintenance budget

Action point:

Provide councillors with details of overspend in the repairs and maintenance budget.

Capital Programme

·         Overall, the capital programme showed an underspend of £4m

·         Work in Bourne Core Area originally scheduled for 2011/12 rolled over to 2012/13

·         Funding for Grantham Growth, which was not used rolled to 2012/13 and were likely to roll into 2013/14

·         The majority of spend for the Bourne Community Access Point would take place in 2012/13

·         The HRA Capital Programme outturn for 2011/12 was £4.709m which represented a variance (surplus) of £0.701m compared with the forecast position and a variance of £2.046m compared to the original budget (this was a result of reprofiling to work more economically and improve value for money)

Members noted variances in repairs and improvements. In response to questions from Councillors, officers advised that the only rights they had to enter a tenant’s property was in health and safety related matters (for example replacing boilers or gas servicing).

Councillors asked for an explanation of the entry in appendix A which related to leisure centres, as a 102% variance was shown against Grantham Meres Leisure Centre.

Action Point:

Officers to investigate the variance at the Mere’s leisure centre and provide an explanation for PDG members