Agenda item

Report CFM397 of the Corporate Finance Manager

(Enclosure)

The Corporate Finance Manager presented report number CFM397 on the budget monitoring information which included a summary of the forecast outturn position as at the end of Quarter two against the annual budget for 2016/17 for the General Fund Revenue Budget, the Housing Revenue Account Budget and Capital Programmes – General Fund and HRA.  It was noted that due to the timings of the PDG, the information for Quarter two had been too late for the November meeting of the PDG.  Details for the end of Quarter 3 would be submitted to the March meeting of the PDG.

Members were verbally informed there had been no significant variances and the outturn position was expected to be in-line with projections.  The forecast outturn work undertaken on a quarterly basis by business areas enabled options to be considered on spending proposals for the remainder of the year.  It was also used to identify any emerging financial issues that may need investigating so mitigating actions could be put in place if required. 

The PDG was informed of a 1.7% variance on the Budget forecast outturn for 31^st March 2017 as at Quarter 2 projections.  The detail of the variances was summarised by priority area in Table A in the report.

Table ‘B’ outlined the main factors impacting on the forecast variance position.

Table ‘C’ provided further detail on the general fund significant income streams.  It was noted that the majority of the discretionary income was outside the Council’s direct control or influence.

There had been little movement on Table ‘E’, HRA Variance Analysis, although some key movements with respect to budgeted rental income was being influenced by Universal Credits.

With regards to Capital Programmes and funding it was noted that due to a review of the St Peter’s Hill proposed development, the residual budget of £4.529m would be moved to next year.  The Property Investment Strategy had a forecast slippage of £5m due to a lack of commercial investment opportunities that met the Council’s requirements.  Consideration may need to be given to whether the Investment Strategy may need reviewing in light of the difficulties of securing a commercial investment property.  It was suggested that the Resources PDG may want to review the Investment Strategy at a later date.  The slippage of £5m would be moved across into the following year.

The following issues were discussed by the PDG:

     1.          Table B – Projected Income unlikely to be received being included in the budget and how this affected projections and budgeting;

     2.          Table G – The number of project slippages and how external forces impacted on these projects;

     3.          Whether there was a point at which money set aside for projects could be diverted to other active projects or services rather than be left ‘allocated’ in the budget until the end of the year;

     4.          The proposals on the St Peter’s Hill Development to be submitted to a future PDG;

     5.          Table B – Growth – Planning: It was felt that the explanation implied that funding was for a single application.  Would other applications be included or receive similar funding;

     6.          Money aligned for homelessness, how this was used and how the homelessness issue was going to be addressed;

     7.          Reviewing the Community Fund and the applications and ensuring the Fund continued to be promoted, and

     8.          Corporate savings: whether the target had been reached and what impact vacant posts and restructuring had on this figure.

Action note:

The Resources PDG note the Financial Report for 2016/17 – Qtr 2 Forecast Monitoring information.