Agenda item

(CSP: 6 & 8)

Purpose:  To inform Members of the provisional financial outturn for the Council for the financial year 2014/15. To note that these figures are provisional and may change during closedown and as a result of External Audit.

RESOLVED that the report be noted.

Reason for the decision: n/a.

Other options considered: None.

This decision is not subject to call in as:

·      Report is to note only

therefore it will be implemented immediately.

The Executive considered a report (Agenda Item 6) which informed Members of the provisional financial outturn for the Council for the 2014/15 financial year. These provisional figures might change during closedown and as a result of the External Audit process.

The total revenue expenditure in 2014/15 was £121m with a provisional year end overspend of £30k or 0.02% of the net budget. This overspend would result in a reduction in the General Fund.

The Council had delivered revenue outturns close to its budget requirement over recent years. The revenue underspend as a percentage of net budget was 0.44% in 2011/12, 0.5% in 2012/13, 0.37% in 2013/14 and, as reported, an overspend of 0.02% in 2014/15.

The Communities Directorate year end position was an overspend of £605k, which was due to pressures in Children’s Services. The Environment Directorate year end position was an underspend of £324k and the Resources Directorate an underspend of £272k.

In summary, the Council had managed to achieve a relatively small revenue overspend in what had been a challenging year. This had been achieved through effective management of its finances over the last 12 months against a back drop of continued local and national financial volatility.

The Capital Programme was underspent by £4.7m, against the revised budget of £35.2m. It was proposed to carry forward this sum to 2015/16 to meet ongoing capital commitments.

Councillor Alan Macro challenged that the overspend was £30k and instead argued that the Council had overspent by £275k as some funding had been drawn down from the risk fund. Councillor Macro stated that the use of the risk fund had not been made clear in the report. Councillor Roger Croft offered assurance that movements from the risk reserve were part of normal accounting practices. Councillor Alan Law added that Councillor Macro’s net figure was not correct and further information on the use of risk reserves would be provided in the audited accounts. Councillor Croft advised that he would ask the Section 151 Officer to provide a written statement to Councillor Macro which detailed all movements of funds from the risk reserves.

Councillor Lee Dillon contested the validity of some of the savings identified in the report. He put forward the argument that savings would be made by providing the same services for less money whereas the Council had been providing fewer services for less money. Councillor Dillon stated that cuts had harmed the most vulnerable people in the community and while he recognised the context of the economic downturn and the need to make savings, it needed to be clear in the report where a saving was achieved versus where a cut had been made.

Councillor Macro, referring to pages 28 and 29 of the agenda, noted the overspend in Children’s Services. He noted that the number of Looked After Children was increasing as the number of children receiving Early Intervention services was decreasing. Councillor Macro asserted that by seeking savings in the Early Intervention service’s budget, extra pressure had been placed upon Children’s Services as a whole and therefore the budget was overspent. Councillor Lynne Doherty explained that 34 additional children had required care packages in 2014/15 than had been forecast. Children’s Services had a demand-led budget and some hard decisions had been made to enable the most vulnerable children to receive care packages.

RESOLVED that the report be noted.

Reason for the decision: n/a.

Other options considered: None.