Agenda item

Report of Senior Accountant, Finance Shared Services

This report informs the Budget Panel of the reported budgetary variances at the end of November 2013 (Period 8).

The Panel received a report of the Senior Accountant, which included the latest edition of the Finance Digest. 

The Chair, Councillor Dhindsa, referred to the variance analysis for waste and recycling.  He asked why the overspend had been allowed to reach this level.

The Shared Director of Finance explained that the £68,000 overspend had been reported in period 8 but actually related to a period prior to the transfer to Veolia.  Agency staff or overtime had been used to cover for staff absences.  She acknowledged that the information should have been reported in the Finance Digest earlier in the year.  She added that waste and recycling had transferred from one department to another.

In response to a question from Councillor Martins about the variance for the ICT service, the Shared Director of Finance advised that detailed works on the budget had taken place since the transfer and some budgets had not been allocated correctly.  It also covered the additional work required to meet the Public Services Network requirements.  She informed Members that the Council was compliant.

The Head of Finance Shared Services responded to a question from Councillor Derbyshire about the underspend in Strategic Finance.  He advised that the majority of the underspend related to Revenues and Benefits Client costs. 

Councillor Taylor noted the comments in Table 4 within the Finance Digest and the reference to the Council being below the business rates baseline.  He asked for further clarification.

The Shared Director of Finance reminded the Panel about the Business Rates Retention Scheme.  The Government had set a baseline figure for Watford. If the Council collected above the baseline it would keep a proportion of the income, however if it collected below the baseline it would lose some of its funding.  She advised that there was a safety net of 7.5% and if the Council collected less than the safety net it would be compensated up to the safety net level.  The Shared Director of Finance informed the Panel the those businesses located in The Parade had been awarded a 15% reduction in their business rates for a limited period due to the current Town Centre works.  The Council had contacted the Valuation Office to advise that some of the works had been completed and some businesses were no longer affected by the works.  Officers would wait to see if the Valuation Office would further review the reductions.

In response to a question from Councillor Turmaine, the Shared Director of Finance explained that Buildings and Projects’ budget had been reduced due to the outsourcing to Veolia, however, the Head of Service had since advised that the funding may need to be restored to the pre-outsourcing levels. 

The Head of Finance Shared Services informed the Panel that the faces and bells in the tables were produced based on a comparison of the forecast and the current budget.

Councillor Turmaine noted that in Table 4 Revenues and Benefits had a forecast variance in Period 8 of £213,000.  He asked for an explanation.

The Shared Director of Finance advised that officers had looked at the budget and discovered that some budgets were incorrect.  For example there was insufficient budget to cover the cost of annual billing.  In addition the department had employed agency staff to help improve the service.   The information had previously been reported to this Panel and to the Shared Services Joint Committee. 

RESOLVED –

that Budget Panel’s comments be noted.