Agenda item

Cabinet considered the Resources Report - Revenue and Capital Budget Monitoring - Month 4 (31 July) 2019/20.

The Leader of the Council introduced the report and commented that there were pressures on the revenue budget in relation to service costs of £4.3m although this was partly offset by an underspend of £1.4m on the corporate budget. The overall budget was in a better position than last year as budgets had been restored to reflect demand-led pressures.

Ambitious targets had been set to deliver savings through the organisational redesign and review of contracts. These one-off savings that had taken longer than expected to deliver but were vital for a sustainable budget in future years. There was significant overspend on the Dedicated Schools Grant – High Needs Block. This was recognised by the Government and was not unusual but had resulted in an overspend this financial year which would need to be managed and mitigated with schools. The Council needed to continue to reform its services going forward to ensure they were suitable for future demands in spite of financial pressures.

The Cabinet Member for Adult Social Care commented that in relation to the £2.8m overspend in adult services, commissioning of nursing services at an expected cost level as well as increased demand levels had presented difficulties. This reflected the shortage of available nursing staff in the county. As a result, the cost of employing agency staff at nursing homes had increased. Despite these issues, the proposed £8m savings were on target to be delivered. He welcomed the improvements to the road infrastructure in Pershore including the Pershore Northern Link Road. Although the Council had £460m of debt, it paid low interest rates and the level of debt was lower than a number of other county councils. £100m of that debt related to the Energy from Waste plant.

A local member from outside the Cabinet expressed delight and relief that the Pershore Northern Link Road had been included in the capital programme.

A local member from outside the Cabinet welcomed the inclusion of £2m in the capital programme for works on the junction of the A38 and A4104 at Upton-on-Severn.

A member from outside the Cabinet queried the plans for the use of the waste reserve. The Leader of the Council responded that plans were in place to utilise the waste reserve. The Director of Environment and Infrastructure had been authorised to enter into discussions with the contractor about the possibility of extending the contract or undertaking a new procurement exercise. The Cabinet Member for Adult Social Care added that it had always been envisaged that the waste reserve would be zero when the PFI contract ended in 2024. It was appropriate to use the reserve over the remaining life of the contract.

RESOLVED that Cabinet:

a)    endorsed the Cabinet Member’s conclusions concerning revenue budget monitoring up to 31 July 2019;

b)   noted the current progress regarding savings plans approved by Council in February 2019;

c)    endorsed the Cabinet Member’s conclusions concerning capital budget monitoring up to 31 July 2019;

d)   agreed to recommend that Council approves the updated Capital Programme at Appendix 7 of the report; and

e)    noted the report on borrowing and lending transactions during 2018/19 detailed in paragraphs 58 to 59 of the report and Appendix 8 to the report.