Agenda item

(Director of Resources) to consider the attached report.

The Senior Accountant, John Bell introduced the provisional Revenue Outturn Report for 2015/16. The report provided an overall summary of the revenue outturn for the financial year 2015/16. The General Fund saw £347,000 more than estimated being used from the opening balance, which was more than outweighed by the use of the District Development Fund being £1.1 million less than estimated. Overall the total net expenditure on the General Fund was £16.1 million, some £669,000 lower than the revised estimate.

Similarly, the position on the Housing Revenue Account was £716,000 better than anticipated.

It was noted that:

·         Net expenditure (CSB) for 2015/16 totalled £16.204 million, which was £2,856,000 (21.5%) above the original estimate and £435,000 (3%) above the revised;

·         It was felt sensible to use some of the balance as in recent years there has been Central Government criticism of Local Authorities holding “excessive” reserves;

·         The in year deficit on the business rates collection fund was again relatively small and the main factor creating this was the provision to cover future rating appeals that had to be made;

·         The Councils portion of the Business Rates collection fund deficit at the end of March 2016 was some £606,000 which will need to be paid back over the next two years, thus adversely affecting the future funding available to the General fund;

·         However the Council Tax collection fund shows a surplus of £310,000 which would be paid into the General Fund in future years.The combined net position was approximately £27,000 worse than was anticipated in the Medium Term Financial Strategy adopted by Council in February 2016 and so was not a cause for concern;

·         CSB expenditure was £283,000 below the original estimate and £407,000 higher than the revised;

·         When measured against the Original Budget, salaries were underspent by £465,000. Actual salary spending for the authority in total, including agency costs, was some £20.802 million compared against an original estimate of £21.267 million;

·         There was an additional amount of £215,000 added to the General Fund Bad & Doubtful debts provision as a number of uncollectable debts were written off and Housing Benefit Overpayment debts outstanding at the year end have increased significantly from £2,382,000 to £2,723,000;

·         Net DDF expenditure was expected to be £1,129,000 in the original estimate and £949,000 in the revised estimate. In the event the DDF showed net income of £143,000. This was £1,272,000 below the original and £1,092,000 below the revised;

·         As spending was £1,092,000 below the revised estimate but carry forwards of £775,000 had been requested, a net underspend of £317,000 was shown;

·         Now several transformation projects were underway it was apparent that to progress them small amounts of expenditure were required that could not be repeatedly found from existing resources. To allow these projects to proceed quickly but with appropriate oversight, it was proposed that a DDF budget was established under the control of Management Board, subject to consultation with the Leader;

·         The Invest to Save Reserve was created at the end of 2014/15 with a £500,000 transfer from the General Fund balance. Expenditure was estimated at £87,000 the actual being £75,000. The underspend related to investigating the withdrawal from the NEPP contract;

·         A Surplus within the HRA of £60,000 and deficit of £83,000 was expected within its original and revised revenue budgets respectively, the actual outturn was a surplus of £633,000; and

·         The current financial year was likely to be more difficult for the HRA with the 1% rent reduction coming in and the potential effects of the forced sale of high value voids, the detail of which has yet to be decided, so the better outturn position than expected for the HRA was helpful when viewed in that context.

Councillor Bedford noted the £215,000 added to the General Fund Bad & Doubtful debts provision; did we employ a debt recovery service? Mr Bell said that they were claiming some of the money back but it was a slow process. Mr Palmer added that it could be deducted from benefits paid and/or earnings. If the debtors moved on then we would use an agency to track them.

RESOLVED:

(1)  That the provisional 2015/16 revenue outturn for the General Fund and the Housing Revenue Account (HRA) be noted; and

(2)  That the Committee noted and agreed the comments made by the Finance and Performance Management Cabinet Committee to Cabinet, namely:

a.    That the additional unbudgeted income of £254,000 from the agreement with the major preceptors be used to create a District Development Fund budget of £100,000 for transformational projects and to top up the Invest to Save Fund;

b.    That projects will only be funded from the transformation budget following approval by Management Board and consultation with the Leader; and

c.    That as detailed in Appendix E of the report, the carry forward of £775,000 District Development Fund and £12,000 Invest to Save Reserve expenditure be noted.