Decision status: Recommendations Approved
Is Key decision?: No
Is subject to call in?: No
Members received and considered the report of the Executive Director on the Revenue Budget and Capital Programme Monitoring Quarter 3 2019/20, which had been presented to Cabinet on 9 March 2020. The report contained details of the significant variations of the Revenue Budget and updated Capital Programme.
Since the last report to Cabinet, there had been one reportable virement following a review of the Council’s capital expenditure financing requirement.
Overall, the cost of services identified a deficit of £698,000 which represented a decrease of £390,000 from the Quarter 2 forecast reported in November 2019. The voluntary redundancy programme was likely to cost in the region of £450,000 to £500,000 but would deliver on-going savings in excess of this amount. If these costs were incurred in the 2019/20 financial year, they would be additional to the £698,000 above.
The main reasons for the variations since the last forecast report were attributed to additional income from the Community Infrastructure Levy administration, Land Charges and rent income as well as lower than anticipated spend on waste services, homelessness, staff vacancies and Housing Benefit payments recovered from the Department for Work and Pensions. However, these reductions were offset by further spending in respect of legal costs for planning appeals, payroll consultancy costs, the replacement of broken play equipment in Rye and accountancy restructuring costs.
Investment returns were in-line with the budget although the final year end position would depend on treasury management and property investment decisions made between now and finalising the financial year accounts. Reserves would be used to meet £650,000 of capital expenditure, which was a small reduction of £46,000 compared to the last forecast. Delays in acquiring properties under the Property Investment Strategy had reduced the anticipated level of external borrowing, which in turn reduced the amount required to be set aside for the Minimum Revenue Provision by £428,000.
The council tax part of the Collection Fund was currently forecast to be in surplus by £744,000 at year end and Rother’s share was estimated to be £91,000. This has been reflected in the 2020/21 budget.
Business rates were forecast to be in surplus of £1.8m by year end and Rother’s share was estimated to be £758,000. This had also been reflected in the 2020/21 budget.
Capital spend to the end of December 2019 totalled £13.6m which included the purchase of the freehold of Market Square, Battle, as identified in Appendix A to the report.
Monitoring spend and income would continue in order to mitigate additional costs and its impact on the Council’s reserves.
RESOLVED: That the report be noted.
Publication date: 30/03/2020
Date of decision: 16/03/2020
Decided at meeting: 16/03/2020 - Overview and Scrutiny Committee