Agenda item

To present the Council’s forecast 2023/24 financial position as at end of December 2023. The report covers the following areas:                                     

·                            General Fund Revenue Budget

·                            Housing Revenue Account Budget

·                            Capital Programmes – General Fund and Housing Revenue Account

·                            Reserves overview – General Fund and Housing Revenue Account

The Leader of the Council introduced the report covering April to December 2023.

The Revenue budget for the General Fund set by Council on 1 March 2023 was £22.256m.

The approved budget amendments, together with forecast changes since the previous budget update report, indicated a projected reduction in the use of reserves for 2023/2024 of £1.393m.  This was a reduction in use of reserves of £312k since quarter 2 budget update report presented to the Finance & Economic Overview and Scrutiny Committee in November and Cabinet in December. 

Since the quarter 2 report, it had been confirmed there would be no further salary award payments to be made following the national settlement and as such, there was a reduction in the required approved funding of £86k.

The budget set by Council on 1 March 2023 for the 2023/2024 General Fund Capital programme was £12.147m.  The General Fund confirmed that there had been a further reduction in the forecasted use of a budget stabilisation reserve which was positive.  Investments were performing at a better rate and better performing income was confirmed, particularly on green waste and commercial waste.

The budget set by Council on 1 March 2023 for the 2023/2024 HRA Revenue Budget was £7.519m.  The budgeted surplus was fully utilised to fund future investment in stock growth and property maintenance.  Void rates remained challenging and particular issues were experienced in terms of tackling damp and mould in Council properties.

The budget set by Council on 1 March 2023 for the 2023/24 HRA Capital programme was £18.479m.

The Council Tax collection was £83.731m as at 31 December 2023 against an annual debt of £99.900m.  This was 0.21% below the expected target equating to a reduction in the collection of Council Tax £210k.  The service continued to issue reminders and summonses in line with the recovery timetable and provided advice & support for those council taxpayers who were struggling to meet their obligations.

The Business Rates collection was £33.760m as at 31 December 2023 against an annual debt of £40.834m.  This was 3.31% above the expected target at 31 December 2023 which equated to an increase in the collection of business rates of £1.352m.  The business rates base remained volatile.

Rent Collection was £20.077m as at 31 December 2023 against an annual debt of £28.197m.  This was 0.30% below the expected target rate at 31 December 2023 which equated to a reduction in the collection of rent of £86k.

Members raised the following points during discussion:

·       How much income was lost each month through void properties?

·       Had the recruitment of tradespeople been widened?

·       The integration of the Grounds Maintenance and Street Cleansing Teams was to provide a more efficient and effective service.  Was this proceeding well?

·       A Member noted the vacancy turnover rate and suggested the charts be separated between permanent staff and staff intentionally hired to be temporary employees as savings on agency staff may be possible.

·       A comparison of collection rates with neighbouring Local Authorities would be welcomed.

·       A Member asked about the justification of spending £90,000 moving the housing team.

·       A Member noted the £50,000 spent on the external audit.  A guarantee was requested from the leadership that they would keep the Stamford Arts Centre open.

·       The overall decrease of close to £7 million in the reserves was noted.  Consideration was given as to whether the Council’s Governance could be interpreted as ‘stable’.

Councillor Baxter stated the integration of the Grounds Maintenance and Street Cleansing Teams was complete.  Savings had been made but not as high as first calculated due to alterations in the level of services offered.

The Deputy Chief Executive confirmed a saving of £160,000 had been achieved through the integration of the Grounds Maintenance and Street Cleansing Teams.  However, £50,000 had been recalled by the service for extra grass-cutting due to the wet season.  Further savings were likely as work continued to align the services.  The Officer informed Members that Void properties and the current turn-around times were on the agenda for the Housing Overview and Scrutiny Committee, however current rental costs on empty properties were £98,000 per month.  While the Council welcomed comparisons with other Local Authorities for collection rates, there was some reluctance from other Councils to make their rates public.

The Leader confirmed that employees were staying at SKDC longer leading to a decrease in vacancy rate.  Budgets were prepared on the assumption of a 3% vacancy factor.

The Deputy Chief Executive said that £90,000 was used to modify and adapt the unit to suit the needs of the housing team, including accommodation for the number of staff.

ACTION:

A financial breakdown of the cost incurred to move the Housing Team were to be circulated to Committee Members.

The Leader informed Members that the money from reserves had been spent on essential improvement projects, as opposed to taking out loans.

The Deputy Chief Executive clarified that the audit fees were a result of a Central Government mandate and that the Council had no role in negotiating those fees.  It was not expected that Governance Reserves would be reduced in the next financial year.

The Leader informed the Committee that he could not give a guarantee on the Stamford Arts Centre, but that, especially with the money spent on the Arts by the Council, it was highly unlikely that the Stamford Arts Centre would be closed.

It was AGREED that Finance and Economic Overview and Scrutiny Committee:

1.    Reviewed and noted the forecast 2023/2024 outturn position for the General Fund, HRA Revenue and Capital budgets as at the end of December 2023

2.  Identified any variances that may have required action or investigation.