Cabinet received and considered the report of the Interim Deputy Chief Executive and Section 151 Officer on the Revenue Budget and Capital Programme Monitoring Quarter 3 2023/24. The report updated Members on the Council’s finances as at the end of December 2023 and projected provisional outturn for 2023/24.  The Revenue Budget, Capital Programme Statements and impact of the forecast on the Council’s reserves were summarised at Appendices A, B and C to the report respectively. The report also included a brief update on the Collection Fund performance.

The forecast outturn for the 2023/24 financial year was based on the position as at 31 December 2023 and indicated a forecast deficit position of £2.709m at 31 March 2024, against a budgeted deficit of £2.221m, which was a variance of £488k.

The report detailed the material variances and the forecast was summarised at Appendix A to the report.

Several small savings were being forecast by the end of the financial year, with no more being achieved. The Medium Term Financial Strategy (MTFS) removed the current Financial Stability Programme and replaced it with a new ‘Fit for the Future’ financial resilience programme, which was designed to close the budget gap over the medium-term period through making efficiencies, savings and increasing income to help support frontline services. The forecast deficit had increased by £200k since the previous quarterly report, as these savings were being made in the services directly and not in this part of the statement.

Since the 2023/24 budget was approved, several small, unbudgeted, grants from the Department for Levelling Up, Housing and Communities  had been received, mainly in respect of New Burdens grants and additional Section 31 Grants.

The Interim Section 151 Officer was continuing to work with Heads of Service and elected Members to undertake a fundamental review of capital schemes within the Capital Programme, which currently amounted to more than £157m. The revised 2023/24 budget was £28.5m (Appendix B to the report) and the forecast outturn for the year at Quarter 2 was £20.1m, a variance of (£8.3m) or 29% of the programme. Most of the forecast underspend was attributable to schemes which had progressed more slowly than expected or had been paused pending review, with only a small amount of savings forecast on schemes which had been completed. An external consultant had been employed to undertake the review, which would be completed within the next six to twelve months.

The Mount View Street Development scheme was completed in 2020/21; at that time, no accruals were made for outstanding expenditure.  Subsequently, in 2023, a payment was made in respect of valuation work, at a cost of £42.5k.  To enable this to be financed, it was requested that Council approve the reinstatement of the scheme to the Capital Programme and the additional budget of £42.5k, to be funded from borrowing.

The forecast impact on reserves was a drawdown of £2.449m for revenue, which was £404k higher than the planned use of £2.045m, and £0.260m for capital which was £84k higher than the planned use of reserves. 

The Council Tax collection rate at the end of Quarter 3 was 84.20% of the collectable debit, 0.07% higher than the corresponding figure in 2022/23.  The Business Rates collection rate at the end of Quarter 3 was 83.31% of the collectable debit, 1.26% lower than the corresponding figure in 2022/23.  It was noted that the collection rates continued to hold well despite the squeeze on finances following the pandemic and the cost-of-living crisis, although business rates were showing a larger, adverse difference in the income received as a percentage of collectable debt, when compared to the previous year.

The forecast outturn on the Revenue Budget at Quarter 3 2023/24 was a deficit of £2.709m, which was £488k greater than the approved planned use of Reserves. The Council’s Capital Programme had a forecast outturn of £20.1m.

RECOMMENDED: That a budget in respect of residual costs on the Mount View Street Development scheme, be added to the capital programme in 2023/24, at a cost of £42.5k, to be financed from borrowing;

AND

RESOLVED: That the report be noted.