Agenda item

Members heard from the Business Support Team Leader regarding the quarter two budget monitoring report for 2024/25, based on the forecast outturn as of 30 September 2024. She summarised the different elements of the report as follows.

Revenue

In relation to revenue budgets, the forecast outturn position was a net contribution to reserves of £160,000 which was a decrease of £364,000 from the forecast position reported at quarter one. This reflected the impact of the pay award for 2024/25, which was agreed in October, with an average increase of 3.5% across all scale points, at a cost of around £500,000 for the year. Other significant movements included an increase in interest receivable due to the current base rate being higher than the peak expected when the budget was set, and there was also a forecast underspend on the interest payable. This was a net increase in income of £270,000.

This was offset by a forecast pressure on Housing Benefit subsidy of £120,000 due to placements with supported accommodation providers who were not registered housing providers, meaning the Council was unable to claim full subsidy on the Housing Benefit paid out to any tenants in those properties.  Landlords were being urged to become registered, which meant they would be regulated, and the full subsidy could be claimed.

Capital

In relation to capital, schemes were reporting a net £4.996m underspend against budget, resulting in a revised capital budget of £27.601m for 2024/25. The amendments to scheme budget included:

·         £4.327m of underspends – the most significant being the Home Upgrade phase two scheme as a result of a delay in the initial delivery and reduced take up of the scheme.

·         £0.669m of carry forwards into 2025/2026 – the most significant of these being the Gainsborough Heritage Regeneration Scheme – which was due for completion by September 2026.

Members were directed to the full capital monitoring table as included at Appendix 1, which included the expected completion date for each scheme, as had requested by Members when the quarter one monitoring report was presented at the meeting in July.

Members of the Committee thanked the Officer and her team for their work and for presenting an excellent report. In response to an enquiry regarding the recently announced introduction of increased National Insurance contributions, it was explained that did not come into effect until the next financial year and so was not included in the current reports.

Members of the Committee raised concerns regarding the underspend on staff salaries due to vacancies, and whether there was any impact on the performance of the Council. It was confirmed that it was expected to have a period of vacancy between an employee leaving and the position being filled. Both policy committees had received the Progress and Delivery reports which demonstrated there was no impact on the performance of the Council resulting from any vacancies.

In relation to the income from building regulation fees being below expectations, Members of the Committee passed comment on the declining rate of construction and development in the district, noting areas where planning permission had been granted although work had not commenced, as well as areas where work had commenced but was not progressing at the rate which had been expected. This was recognised to be a national issue, with Members suggesting government needed to do more to support the industry and encourage or mandate a higher and faster rate of construction.

Further comments were made regarding the longer term, continuing benefits of investment in the district, with Officers confirming that a benefits realisation review would be undertaken, specifically regarding the UKSPF work. Additionally, a Member of the Committee suggested the government needed to have greater input with making it worthwhile for private landlords to become registered providers, as this was not something the Council could do across the district without greater national emphasis.

In response to a query regarding borrowing requirements and credit worthiness, the S151 Officer explained that the next item on the agenda would better deal with those comments, however confirmed that regular briefings were held with independent advisors regarding at risk borrowers or safe investments.

The Chairman thanked Members for their questions and comments, and suggested taking the written recommendations, as contained in the report, en bloc. Having been proposed and seconded, he took the vote and it was unanimously

            RESOLVED that

REVENUE

a) the forecast out-turn position of a £0.160m net contribution to reserves as of 30th September 2024 (see Section 2) relating to revenue activity, be accepted; and

b) the contribution to Earmarked Reserves - £0.125m (2.4.1), be approved; and

c) the use of Earmarked Reserves approved by the Chief Finance Officer using Delegated powers (2.4.2) be accepted; and

d) the contributions to Earmarked Reserves approved by the Chief Finance Officer using Delegated powers (Section 2.4.3) be accepted; and

e) the amendments to the fees and charges schedules for 2024/2025 (2.3.2 and Appendix 5* commercially sensitive), be approved.

CAPITAL

f) the current projected Capital Outturn position of £27.601m (Section 3) be accepted; and

g) the amendments to the Capital Schemes as detailed in 3.2 be approved.

TREASURY

h) the report, the treasury activity and the prudential indicators (Section 4) be accepted.