Agenda item

Revenue Budget Monitoring - Quarter 3, 2019/20

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


The report of the Director of Function (Resources)/Section 151 Officer setting out the financial performance of the Council’s services at the end of Quarter 3 of the 2019/20 financial year was presented for the Executive’s consideration.


The Portfolio Member for Finance reported that based on information to the end of Quarter 3 the overall projected financial position for 2019/20, including Corporate Finance and the Council Tax is an overspend of £1.246m or 0.92% of the Council’s net budget for 2019/20.This is due to similar pressures experienced in 2018/19 which have been reported upon in budget updates throughout the current financial year, the most significant of which are the costs of Adults’ Services and School Transport. The pressures in these service areas need to be addressed in the Budget for 2020/21.


The Director of Function (Resources)/Section 151 Officer advised that a projected overspend of £1.246m is a matter of concern since it will have to be met from the Council’s General Reserves Fund which it is anticipated will further deplete the reserves to a level under £5m by the end of the financial year. This is well below the minimum balance of the general reserve which has been set at £6.7m as approved by Full Council on 27 February, 2019. An increase over the year in the number of clients requiring high cost provision has put pressure on Adults Social Care budgets – it is planned that these pressures are recognised in the 2020/21 Budget.


The Executive in noting the information inquired whether the overspend is a case of the  service spending more than its core budget or whether it is a case of not enough resources being allocated to meet demand when the core budget is being set. The Executive sought further clarification of whether it is possible to more accurately forecast demand which would take the pressure off budget planning.


The Director of Social Services clarified that whilst it is not possible to predict each and every high cost case, the Service is aiming to put in place a 3 year plan which will cover all areas from Learning Disability to Mental Health and which will set out the steps that can be taken to project the likely number of referrals and to manage the costs as those referrals come in. This will enable the Service to consider the challenges in terms of funding, commissioning and collaborating with the Health Board to establish how best to manage demand down as much as possible within the overall requirement to meet people’s needs. The Service will never be in a position to be able to predict demand 100% accurately as some individuals deteriorate rapidly thereby requiring more intensive provision whilst there will always be individuals coming to the Island some of whom will need support.  


The Portfolio Member for Finance highlighted that the additional funding of £1.4m provided in the 2019/20 Budget to support Children’s Services which last year were in a similar position of overspend has contributed to a significant improvement in that Service’s budgetary position in 2019/20. However, due to the difficulty in predicting demand, the situation in Adults’ and Children’s Social Care is fluid. An ageing population and increasing demand mean that a national strategy is ideally required to resolve the funding issues in Adults’ Social Care otherwise councils will continue to find themselves spending time “firefighting” instead of planning ahead.


It was resolved to note the following –


           The position set out in appendices A and B in respect of the Authority’s financial performance and expected outturn for 2019/20.

           The summary of contingency budgets for 2019/20 as detailed in Appendix C to the report.

           The position of the invest to save programmes in Appendix CH to the report.

           The position of the efficiency savings for 2019/20 in Appendix D to the report.

           The monitoring of agency and consultancy costs for 2019/20 in Appendices DD, E and F of the report.

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