Report of Head of Finance.

The committee received a report of the Head of Finance. The Head of Finance     introduced the report. This was the second monitoring report of 2021/22 covering the period up to the end of September. The key areas highlighted were:

Revenue Summary

·             There was a forecast unfavourable variance of £728k. This had increased from the forecast £487k at the end of Q1, with an increased variance of £241k.

·             There was a decrease in the forecast expenditure for professional fees allocated to monitoring the council portfolio, however there were now new risks and adverse forecasts.

·             There had been an increase in kerbside recycling costs due a market variation of £100k and an additional pressure of £56k on the community asset management team. In addition to this, there was £106k expenditure on independent reviews and a net change of £33k in net commercial rental income.

·             There was also an increase of £41k due to small variations across the budget.

·             The financial position was typical for the time of year. The forecast was said to be prudent and was expected to see improvement by the end of the year.

·             There were some funds that had not been drawn down such as the forecast £350k allocated as additional support for leisure operators; this may not be needed by the end of the year.

Capital Summary

·             There had been further slippage with a variance of £48.5 million against the original budget of £68.9 million.

·             Significant contributors to this slippage included draw downs and loans into joint ventures.

·             This was said to be typical as there are numerous long-term programmes and it was difficult to accurately time draw downs.

Reserve Summary

·             Forecast General Balance was £2.0 million which was the risk assessed level.

·             Earmarked reserves remained healthy even after funding the forecast shortfall of £728k from the Economic Impact Reserve.

·             Data on debtors remained promising as a substantial amount of the outstanding debt had been received just outside the reporting period.

Staff Vacancies

·             The council was in a similar position to the last report.

·             Significant posts were being covered by interim employees and a review was being carried out to factor the vacancies in the budget for the next financial year.

Key Risks

·             The Employers’ Pay Award had not been confirmed but if it were to be confirmed, it would add an additional pressure of £205k which would be an ongoing pressure that would have to be built into the council’s Medium Term Financial Strategy.

A question was asked by Councillor Khan regarding what was being done about staff vacancies, given fact that many of the role had been vacant since January 2021 and that these roles could have provided employment to local residents. The Head of Finance explained that some of the roles could have been filled since the publishing of the report but the question would be referred to Heads of Service so that a written response could be provided. It was also said that the council’s position was not unusual within the sector.

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