Agenda item

(CSP: MEC and MEC1)

Purpose: To inform Members of the provisional financial performance of the Council for 2016/17 .

Resolved:

·      to note the outturn position and that the service specific risk funds would not be called upon, due to under spends in other areas across the Council.

·      that the budget movements processed in year and detailed in Appendix E had been reviewed.

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 set out the provisional financial outturn of the Council for 2016-17.

Councillor Graham Jones introduced the report and explained that the provisional revenue outturn was an overspend of £7,487 against a net revenue budget of £116.8m, which equated to 0.006% of the net budget. Councillor Jones also reported that 95% of the 2016/17 savings programme was achieved in year.

Councillor Jones felt that these were commendable achievements during difficult financial times. This was particularly so when considering the difficulties being experienced by some near neighbour local authorities. By way of an example, Councillor Jones referred to Reading Borough Council whose provisional outturn was an overspend of £7.3m.

Councillor Lynne Doherty stated her pleasure at the underspend reported for Children and Family Services. This was particularly commendable when considering that the service had undergone an improvement journey. A number of measures had been implemented successfully in order to achieve this, whilst still meeting demand. There had therefore been no need to utilise the service risk fund.

Councillor Doherty added that there had been a reduced need for agency staff in the service and therefore cost, with the use of agency staff having reduced from 29% to 12% of the workforce. Placement costs had also been well managed.

Councillor Lee Dillon referred to Adult Social Care. He noted that the overspend in this service had reduced from Quarter Three and this was partly due to client care packages not commencing as previously forecast. He queried whether this was due to some clients having a less acute need than originally anticipated.

Councillor Dillon also noted that there had been less use of direct payments and queried whether there was a need to educate residents on the use of this funding to encourage them to make use of it.

There had also been a lower demand for carer support. Councillor Dillon queried whether this was due to the needs of residents being less complex or whether there was a stricter assessment process in place for this support.

In response to these points, Rachael Wardell explained that a high cost scenario was forecast for care packages. Actual costs became clearer towards year-end and some lower cost packages had been achieved. It was also the case that not all packages would continue for a full year as, sadly, some clients died.

Direct payments were discussed with clients as part of social work reviews when consideration was given to the expenditure of this funding and whether the needs of clients were being sufficiently met. This was alongside seeking to encourage independence of service users.

Rachael Wardell agreed to explore with the service whether there was an identifiable reason for the reduced demand for carer support and to confirm that in writing, but confirmed that the service did take steps to ensure carers were made aware of support available.

Turning to the Education Service, Councillor Dillon noted that savings had been achieved in Property due to a reduction in reactive and planned maintenance. He queried whether this related to corporate buildings or schools, and whether reductions to planned maintenance could lead to higher building costs in future years.

Councillor Doherty explained that this related to both corporate buildings and schools. She added that savings to planned maintenance were due to works not being required currently and this would not therefore impact on future years.

In the Capital Programme, the Superfast Broadband project had underspent by £740k as one of the main contractors, Gigaclear, had not invoiced the Council by year end. Councillor Dillon queried whether it was also the case that the project was behind schedule.

Councillor Dominic Boeck advised that Phase Two of the Superfast Broadband project would be completed by year end, whilst acknowledging that the project had suffered some delay. By that time, the necessary invoices would have been received and paid, with the 2016/17 underspend carried into 2017/18 to meet these costs.

Councillor Alan Macro noted that the weekly cost of residential and nursing care home beds had increased by 12% and 14% respectively. He was concerned should this level of increase continue and queried whether this was budgeted for in the 2017/18 financial year.

Rachael Wardell explained that an increase in care home beds was budgeted for and added that prices were reviewed on an ongoing basis to ensure funds were adequate. Whilst there had been no need to utilise the Adult Social Care Risk Fund in 2016/17, it continued to be available to meet pressures.

Councillor Macro then queried the grant received from the European Social Fund. This helped to achieve a underspend in the Education Service, but Councillor Macro queried why this had not already been included in the budget. Councillor Doherty gave her understanding that this grant, which served to provide support to young people for costs relating to 2015/16, was based on the number of eligible young people in a Census count and the number of young people, and therefore the level of grant, was not known in advance of the grant being received.

Councillor Macro next made reference to the fact that a payment from Kennet School for Kennet Leisure Centre of £43k was still in dispute. He queried how long this had been an issue and whether efforts were being made to resolve it. Councillor Hilary Cole agreed to provide a written response on this point, but gave an assurance that efforts continued to resolve this matter.

Income on interest on investments was £113k below target due to factors including the low level of interest rates currently available in the market and a lower cash fund balance in 2016/17 because of use of balances in 2015/16. Councillor Macro queried why this had not been identified earlier. Melanie Ellis agreed to provide a written response to this query that would contain a detailed breakdown of why this target was not achieved.

Councillor Billy Drummond noted that pressures had arisen in Highways and Transport in relation to street lighting energy. It was explained in the report that this was a result of the new corporate energy contract, but Councillor Drummond queried the reason for this pressure developing. Councillor Jeanette Clifford explained that while expenditure on street lighting had reduced, this was not at the level forecast earlier in the year, hence the pressure.

Councillor Drummond also noted that high consultancy costs for large planning applications was another pressure within Highways and Transport. He queried whether it would be preferable and more affordable for the Council to have in-house staff able to perform this work. Councillor Clifford responded that these were exceptional projects which required additional resource. Councillor Cole added that it was standard practice for the highways modelling team, in West Berkshire and other areas, to buy in consultants for specialist work on major applications.

Councillor Dillon accepted the point around exceptional cases, however with a view to ongoing and further large planning applications, he queried whether it would be more efficient for the Council to have its own in-house team for this purpose. Councillor Cole responded that this was not felt to be the case. She assured Members that effort was always given to deliver the most efficient and effective service, and a decision to bring in external expertise was always carefully considered first, with the merits of doing so carefully weighed up. In some cases this was felt to be the appropriate way forward as it reduced the risk of the Council being challenged on its decision making for major planning applications.

RESOLVED that:

1.    the outturn position be noted and that the service specific risk funds would not be called upon, due to under spends in other areas across the Council.

2.    the budget movements processed in year and detailed in Appendix E had been reviewed.  

Reason for the decision: The report forms part of the Council’s financial monitoring framework.

Other options considered: None– factual report for information only.