Agenda item

Quarterly Performance and Financial Management - Quarter 3 2018/19

Report by Leader and Executive Team (attached).

Minutes:

The Executive considered a report by the Leader and Executive Team (circulated previously), the options and/or alternatives and other relevant facts set out in the report regarding  the Performance and Financial Management report for Quarter 3 of 2018/19.

 

The Accountancy Services Manager highlighted the following:

 

·         As at 31st December 2018, the latest forecast net expenditure was £12.239m, which was £0.019m over budget.  Details were shown in Appendix 1 and it was anticipated that the small variance could be reduced further throughout the remainder of the financial year.

·         The original budget for 2018/19 included a forecast to achieve £0.200m worth of salary vacancy savings. The current position forecasts this would be exceeded and vacancy savings of £0.225m would be achieved.

·         The “Recycle more” service changes were introduced on the 5th June 2017; the take up of the new garden waste service had exceeded expectations, 2017/18 saw a total sign up of 17,320. This year’s income was expected to exceed last year’s total by 570 properties.

·         Within the overall £0.019m net budget deficit there were various cost pressures and one-off savings.  The budget pressures seen within waste and recycling service had not increased any further at the quarter 3 forecast. There had been a significant reduction in the forecast planning fee income of £0.159m due to a reduction in the larger applications received, which was in line with other authorities experiencing the same pressure. However it was forecast there would be additional Business Rates Retention income of £0.200m over and above the budgeted £1.252m Business Rates growth which had resulted in maintaining the net budget deficit at a similar level reported at quarter 2.

·         The Business Rate retention scheme was introduced in April 2013 which sees Billing authorities receive a ‘baseline’ funding but in addition they are exposed to the risks and rewards of retaining a proportion of the income collected.  This exposure was mitigated by participation in the Devon-wide pool that collates all of the Business Rate growth and decline and returns a share of the impact to each local authority. There had been an estimated one-off additional income from the 100% Business Rates Retention pilot for 2018/19 of £0.750m; this additional income had been earmarked into reserves as detailed in paragraph 4.1.6 of the report to help fund future projects.

·         At the 31st December 2018 the total external borrowing was £1.250m.

·         The recommended level of general fund balance is 5%-10% of the council’s net revenue budget (£0.611m to £1.222m). The forecast general fund reserve at 31 March 2019 is £1.161m, which is a level of 9.5%.

·         “Appendix-2 Movement in Reserves & Balances” detailed the movements to and from earmarked reserves in 2018/19.

·         “Appendix-3 Executive Contingency Reserve” detailed the Executive Contingency Reserve movements and commitments. 

·         “Appendix-4 Capital Programme” detailed the 2018/19 to 2020/21 Capital Programme.  The Programme of £12.842m was funded by Capital Receipts (£2.349m), External Grants and Contributions (£8.964m) and Reserves (£1.529m).

·         Variations of (£2.254m) proposed to the 2018/19 Capital Programme as detailed in paragraph 4.4.3 of the report.

·         The revised Capital Programme for 2018/19 taking into account the budget variations above was £5.529m.

·         Actual spend on the 2018/19 Capital Programme, as at 31st December 2018 was £3.128m.

·         Variations of £0.045m proposed to the 2019/20 Capital Programme as detailed in paragraph 4.4.6.

·         The overall Capital Programme for 2018/19 to 2020/21 was £12.842m and was broken down as follows:

·         2018/19 £5.529m

·         2019/20 £6.313m

·         2020/21 £1.000m

·         The proposed release of funds from the 2018/19 Capital Programme as detailed in paragraph 4.4.12 of the report.

·         £67,789 investment interest was earned during the three quarter period.  The 2018/19 interest receivable budget was £60,000.

·         £20,605 interest was paid at an average rate of 2.03% on the PWLB loans during the three quarter period.  The 2018/19 interest payable budget was £40,000.

·         Non-financial information was contained within paragraphs 5 to 9 in the report. Appendix 5 detailed key performance indicators and Service Plan Action updates.

 

In response to a question, the Executive were advised of the following:

 

·         In relation to paragraph 4.1.6 of the report, the £0.150m would be placed in the Improvement Programme Reserve.

                              

DECISIONS

 

(a)

That the actions being taken to ensure that performance is at the desired level be noted;

 

(b)

That the contributions to/from earmarked reserves be approved as detailed in section 4.2 of the report;

 

(c)

That the movements on the Executive Contingency Reserve as detailed in section 4.3 of the report be noted;

 

(d)

That funds be released for the capital schemes as listed in paragraph 4.4.12 of the report;

 

(e)

That sections dealing with Treasury Management (paragraph 4.5), and Debt Management (paragraphs 4.6 and 4.7) be noted.

 

            RECOMMENDED

                         

(f)

That the variations to the Capital Programme 2018/19 to 2020/21 as detailed in paragraphs 4.4.3 and 4.4.6 be approved.

 

            REASONS FOR DECISIONS/RECOMMENDATION

 

(a)

To ensure that appropriate action is taken to allow the council to meet its objectives.

 

(b)

To inform the Executive of actual results compared to the approved Corporate Plan, as well as progress in delivering service within the revenue budget and Capital Programme.

 

 

Supporting documents: