Agenda item

To submit a report by the Head of Function (Resources)/Section 151 Officer.

The report of the Head of Function (Resources)/Section 151 Officer setting out provisional revenue outturn position for 2018/19 including the main budget variances was presented for the Executive’s consideration.

The Portfolio Member for Finance said that having projected a year-end overspend from Quarter 1 onwards,  the actual position at the end of Quarter 4 2018/19 of an overspend of £633k is better than expected and is greatly improved on Quarter 2 when a significant overspend was forecast. Pressure still remains on a number of service budgets with a net overspend of £2,287k, and the main areas to note where the pressures are greatest - Children’s Services, Adults’ Services and Central Education Services – are those that have been reported on throughout the year. The improved position is largely down to one-off savings on corporate budgets and to the efforts made by services from the end of Quarter 2 to curtail expenditure the cumulative effect of which has contributed to reducing the overspend. Looking forward into 2019/20, the Council will hold a reasonable level of general reserves although at £5.9m they remain below the recommended £6.76m level agreed by Council, and service budgets have been increased to reflect the increased demand. Along with the continued close monitoring of the budget position during the year, this should ensure that the risk of a significant overspend during 2019/20 is limited.

The Head of Function (Resources)/Section 151 Officer advised that despite the improved position overall, three of the Council’s services – Children and Families’ Services, Learning, and Adults’ Services continue to experience pressures. Although additional funds provided for in the 2019/20 budget should help Children and Families’ Services address its increasing costs within the Looked After Children section, this is dependent on demand in this and in Adults’ Services remaining constant. The Officer referred to the financial situation in the Island’s schools which was not documented in the report but which had worsened by the end of 2018/19 with 12 primary schools and 3 secondary schools now in deficit compared to 3 primaries and 1 secondary at the end of 2017/18. The special school also remains in deficit. Consequently, school balances have reduced from £1.8m at the end of 2017/18 to £633k at the end of 2018/19. The schools’ budget position therefore needs to be borne in mind when considering the figures.

The Executive welcomed the better than predicted results for 2018/19 acknowledging  that this was in part fortuitous due to one off corporate savings that might not be repeated in future years but recognising also that services had played their part by curbing expenditure. It was agreed that the outlook remains challenging and that further, a close eye needs to be kept on the financial situation in schools.

It was resolved –

•           To note the position set out in appendices A and B of the report in respect of the Authority’s financial performance to date and expected outturn for 2018/19.

•           To note the summary of Contingency budgets for 2018/19 as detailed in Appendix C of the report.

•           To note the position of the Invest to Save Programme set out in Appendix CH.

•           To note the position of the efficiency savings for 2018/19 in Appendix D.

•           To note the monitoring of agency and consultancy costs for 2018/19 in Appendices DD and E.

•           To note that the outturn reported in the document remains provisional until the completion of the statutory audit.