Agenda item

To provide an update as at 30^th June 2023 of the Council’s 2023/24 forecast revenue budget position and the financial position of the capital programme together with the revised capital programme 2023/24 to 2027/28.

Consideration as given to a report of the Director of Finance which provided the Cabinet with an update on the Council’s 2022/23 forecast revenue budget position at Annex 1 of the report and the financial position of the capital programme as at 30 June 2023 (Quarter 1) together with the revised capital programme 2022/23 to 2027/28, as outlined in section two of the report at Annex 2 of the report.

Revenue Position

The forecast outturn position for 2022/23 was a projected deficit variance of £12.104m after allowing for approved and pending transfers to and from reserves

Unlike 2022/23, when 12.00m of corporate resources were held to offset costs arising from the legacy of the COVID pandemic, the budget for 2023/24 had been prepared so that anticipated COVID legacy costs were consolidated with the mainstream budgets of Children’s Social Care and Community Health and Adult Social Care.  Whilst improving, it was recognised that this remained a challenging position and every effort would be made to further reduce the overall variance before the year end.

As the financial monitoring report reflected the financial position as Quarter 1, it could be regarded as an early warning of the potential year end position if no further action was taken to reduce net expenditure where possible.

The management action initiated in 2022/23 across all service areas to review and challenge planned expenditure and to maximise income had to be continued in 2023/24.

Although the impact of this action had yet to take full effect in the current financial year, it was anticipated that by the year end the current outturn deficit position should be reduced.

An update on the major issues driving the projections was detailed within Annex 1, section 2.

Information on the Quarter 1 position of the Dedicated Schools Grant (DSG), Housing Revenue Account (HRA) and Collection Fund was also outlined in the report.

There were currently no significant issues of concern in relation to the HRA.

The Collection Fund was forecasting an in-year surplus of £1.638m which in turn contributed to an estimated surplus of £1.700m.

Whilst currently in surplus, the position would continue to be closely monitored throughout the year as any surplus or deficit at the end of the financial year would have a direct budgetary impact in future financial years.

Capital Position

The report outlined the most up to date capital spending position for 2023/24 to 2027/28 for approved schemes. The revised capital programme budget for 2023/24 was £103.748m at the close of Quarter 1 a net decrease of £6.557m from the original budget approved at Full Council on 1 March 2023 of £110.305m. Actual expenditure to 30 June 2023 was £12.405m (11.96% of the forecast outturn).

It was likely that the forecast position will continue to change throughout the year with additional re-profiling into future years.

Options/alternatives considered

Option 1 – To consider the forecast revenue and capital positions presented in the report including proposed changes

Option 2 – To propose alternative forecasts

RESOLVED – That:

1. The forecast revenue outturn for 2023/24 at Quarter 1 being a £12.104m adverse variance having regard to the action being taken to manage expenditure be approved.
2. The forecast positions for the Dedicated Schools Grant, Housing Revenue Account and Collection Fund be approved.
3. The revised capital programme for 2023/24 and the forecast for the financial years to 2027/28 as at Quarter 1 be approved.