Agenda item

To set out the current financial position for the Council at the end of the third quarter of 2024/25 (report of the Interim S151 Officer enclosed).

Consideration was given to the report of the Interim S151 Officer which set out the current financial position for the Council at the end of the third quarter of 2024/25.

The Portfolio Holder for Finance presented the report, and prior to commencing a more detailed summary, stated that this year, like recent years, would be challenging. This was however being offset by higher than anticipated investment income due to interest rate levels and increased cash balances.

General Fund (GF) Revenue Forecast

The revenue outturn forecasted an underspend position of £176,000 at the year-end.

·       Neighbourhoods had partially mitigated adverse costs identified at quarter two reducing a forecast overspend by £27,000 to £90,000, arising from staffing pressures within the Recycling and Refuse services. This mitigation had also resulted in budgeted savings for future years of circa £160,000 per annum.

·       The General Fund 2024/25 net budget for investment income was £1.033million.  The forecasted full year outturn for investment income as at Quarter 2 was £1.286million, which would be an overachievement of £253,000.

·       For transparency, table 1b provided details of additions to the revenue budget as the year progressed through decision notices and delegated decisions.

·       The 2024/25 budget included a savings efficiency target of £831,000, savings were being tracked and could be found in table 1c. 57% of the target had been identified as at 31 December and the forecast assumed the remaining target would be met with work ongoing to support this.

GF Capital

For General Fund Capital, Table 4a provided details of all capital schemes. The proposed revised capital budget as at Quarter 3 for the General Fund was £6.116million. Changes to the capital programme were also being tracked with a reprofiling of capital budget of £4.322million to future years detailed in Table 4b. Slippage continued to be carefully monitored and considered and budgets refined as the financial year progressed.

HRA

Section 2.3 detailed the HRA revenue budget which was forecasting a surplus of £227,000. This was due mainly to an underspend in Supervision and Management £66,000 and increased investment income £125,000.

For HRA Capital, Table 5a provided details of all capital schemes with the programme totalling £21.851million for 2024/25.  A stock condition survey programme had commenced, which alongside the Asset Management Strategy, would inform future investment decisions.

Treasury

Section 2.6 of Appendix A detailed the Council’s treasury investments. The Council’s cash continued to perform well with £422.7k forecast to be achieved in excess of budget.

Consideration was given to the report and the following issues were raised:

Clarity on the following items within Appendix A - table 4B – Capital Programme Changes was sought, and responses provided:

·       It was clarified that the Uniform System was the new IT system being used within Planning, and that the cost had now been factored in and aligned across the Partnership. 

·       The Christmas lights referred to within the table were part of the Spalding Special Expenses.
With regard to the Lutyens Memorial item, officers would clarify whether this was a Spalding Special Expense or a District expense.

·       With regard to the Industrial Units saving of £520,000, members asked if this related to units in Crowland – officers advised that they would seek further information regarding this from the appropriate team.

·       With regard to Homelessness, the amount of £31,000 referred to was not a saving, rather a reprofiling of the Capital Programme  

·       With regard to the additional Government funding to assist Councils with IDBs, no information on how this would be allocated had yet been received however it was anticipated that this information may be available in May/June

·       Table 5a – HRA Programme (Appendix A) showed Renewable Energy funding of circa £7million received however, only circa £3million had been spent by December – would the remaining £4million be spend in the remaining 3 months of the financial year?

o   Officers responded that the approved budget was representative of the works that had been committed in the financial year however, delivery of the scheme was spread over more than one financial year.  September 2025 was the deadline for completion of all the works.  Works paid for and delivered to date were reflected in the table.  The money would be spent in time.

DECISIONS:

1)    That the forecast revenue position of a £176,000 underspend for 2024/25 as detailed in Table 1, and the need for continued focus on the savings and efficiency programme be noted.

2)    That the forecast revenue position of the HRA for 2024/25 (surplus of £227,000) as detailed in Table 2 be noted.

3)    That the virement of £135,000 from other cancelled spending needs, to fund contract cost pressures be approved.

RECOMMENDATIONS FROM CABINET TO COUNCIL:

4)    That Cabinet recommends to Full Council to amend the Capital Programme at Appendix A – Table 4b to take into account the changes set out in this report.

5)    That Cabinet recommends to Full Council to amend the Capital Programme at Appendix A – Table 5a to take into account the changes set out in this report.

(Other options considered:

·       To not approve the reserve movements outlined;;

Reasons for decision:

·       To ensure the Council’s forecast financial position for 2024/25 is considered and related decisions approved.  It is important that the Cabinet are aware of the financial position of the General Fund and Housing Revenue Account to ensure that they can make informed decisions that are affordable and financially sustainable for the Council).