Agenda item

Report of the Corporate Director (Resources, Environment and Cultural Services) to present the General Revenue Fund (GRF), Housing Revenue Account (HRA) and Capital Programme outturn positions as at the end of the quarter two 2019/20.

The report of the Corporate Director (Resources, Environment and Cultural Services) presented the General Revenue Fund (GRF), Housing Revenue Account (HRA) and Capital Programme outturn positions as at the end of the Quarter 2 2019/20.

The two reports were presented and discussed at Cabinet on 5 November 2019 and were attached to the report.

Quarter 2 Revenue Budget Monitoring Report 2019-20

This presented the forecast revenue account position at Quarter 2 of 2019/20.  Within the General Fund the forecast net drawdown for reserves for 2019/20 remained at £145,000 as reported at the previous quarter.

Variances included a positive variance of £500,000 arising from the “budget reset” following the recent Peer Review.  Efficiency savings from this exercise had been built into both the current 2019/20 budget and the forthcoming 2020/21 budget.  The £500,000 2019/20 savings would be used at year end to fund a revenue contribution to capital which would allow much needed replenishment of General Fund capital reserves.

The other significant variance was an adverse cost impact of £240,000 relating to work on the Local Plan which had been funded by a transfer from earmarked reserves previously established for this purpose.

Within the Housing Revenue Account the forecast closing balance was now £2,621,000, an adverse movement of £169,000 compared to the previous quarter which was due to a higher than forecast revenue contribution to capital.  Such contributions minimised the Council’s future borrowing costs.

Quarter 2 Capital Budget Monitoring Report

This presented the capital expenditure and associated capital funding at Quarter 2 of 2019/20. The current approved capital budget was £66.624M and the current forecast outturn was £43.080M. 

During discussion the following points were raised:

·           Big debtors were chased proactively and if necessary the Councils’ legal team would get involved.

·           Monthly meetings took place with the Executive Member (Resources) and the Finance team.

·           At the end of September 2019, debts outstanding totalled £1.221m, a reduction of £228k on the June position of £1.449m. Performance was measured using a rolling debtor day ratio and this had increased since the June position.  Due to invoices raised to another Council in respect to one of the Council’s contracts, there were some delays and without this the rolling debtor days would have been lower than three.

·           The basement fire at Campus West in July 2019 led to a net £30k variance, as the remedial works were £50k and the excess for the building insurance was £20k. It was confirmed that no electoral material had been damaged.

·           The forecast outturn for Chequersfield had been reduced to reflect that it was likely that only 12 units (out of 30) would be acquired for the Council’s own use with the remaining 18 units being acquired for Now Housing, the Council owned housing company.  The rent for the units of Now Housing would likely be more.

·           The Executive Member (Resources) advised that receipts from Right to Buy had to be spent within a certain period of time.  Open Market Purchases (OMPs) were therefore last resort but better than money going back to the Treasury. Members suggested that a timeline would be useful to ensure that the money was spent in the most efficient way. It was likely however that this was under the remit of the Cabinet Housing Panel (CHP) and the Corporate Director (Resources, Environment and Cultural Services) agreed to find out if this was the case.

·           The average use of Bed and Breakfast (B&B) had now reduced due to the Councils’ alterative longer term solutions, such as the purchase of Inspira House. Members questioned that the forecast outturn for Temporary Accomodation (specified at £64k in the report) be checked as other figures had been quoted at the Social Overview and Scrutiny Committee (SOSC). The Head of Resources confirmed that this was the latest figure and they were not expecting it to increase any more due to the purchasing of Inspira House.

·           Officers confirmed that the funding of the election with some estimates at £90,000, would be covered as it was not a local election.

            RESOLVED:

            That the Committee note the Revenue and Capital Quarter 2 Budget

            Monitoring 2019/20 reports.