Agenda Item No______8______
2012/13 OUTTURN REPORT
Summary:
This report presents the outturn position for the revenue
account and capital programme for the 2012/13 financial
year. Details are included within the report of the more
significant year-end variances compared to the revised
budget for 2012/13. The report also makes
recommendations for contributions to earmarked
reserves for future spending commitments. An update to
the current capital programme is also included within the
report and accompanying appendices.
Options considered:
The report essentially provides a final budget monitoring
position for the 2012/13 financial year, whilst there are
options available for earmarking the underspend in the
year or transferring the underspend to the general
reserve, the report makes recommendations that
provide funding for ongoing commitments and earmarks
funding for future projects.
Conclusions:
The outturn position on the revenue account as at 31
March 2013 shows an underspend for the year of
£185,662 which is being recommended to be
transferred to the Invest to Save earmarked reserve.
The final position allows for a number of underspends to
be rolled forward within earmarked reserves to fund
ongoing and identified commitments. The general fund
balance remains within the current recommended level.
.
Recommendations:
Members are asked to consider the report and
recommend the following to Full Council:
a) The final accounts position for the general fund
revenue account for 2012/13;
b) The transfers to and from reserves as detailed
within the report (and Appendix C) along with the
corresponding updates to the 2013/14 budget;
c)
Transfer the surplus of £185,662 to the
Restructuring and Invest to Save Reserve;
d) The financing of the 2012/13 capital programme
as detailed within the report and at Appendix D;
e) The balance on the general reserve of £1,745,452
at 31 March 2013;
f) The updated capital programme for 2013/14 to
2014/15 and the associated financing of the
schemes as outlined within the report and detailed
at Appendix E.
Reasons for
Recommendations:
To approve the outturn position on the revenue and
capital accounts for 2012/13 that will be used to
produced the statutory accounts for 2012/13. To provide
funding for ongoing projects and commitments within
earmarked reserves as detailed in the main body of the
report and to earmark funding for one-off costs in
relation to business transformation in respect of ICT and
Customer strategies.
LIST OF BACKGROUND PAPERS AS REQUIRED BY LAW
(Papers relied on the write the report and which do not contain exempt information)
Cabinet Member(s): Cllr
Wyndham Northam
Ward(s) affected All
Contact Officer, telephone number and email: Karen Sly, 01263 516243,
Karen.sly@north-norfolk.gov.uk
1.
Introduction
1.1
This report presents the draft outturn position for the 2012/13 financial year
which will be used to inform the production of the Council’s statutory
accounts.
1.2
Commentary on the more significant year-end variances is included within the
report with further supporting information provided within the appendices. The
2012/13 revised budgets for revenue and capital were approved by Full
Council in December 2012 and this report now compares the outturn position
with those budgets. The report also includes a current position statement on
the level of reserves along with the outturn and financing position for the
2012/13 capital programme. The capital programme for the period 2013/14 to
2014/15 has also been updated to take account of the outturn position.
1.3
All budgets have been monitored during the year by Service and Finance
Officers with regular reports being presented to Cabinet and Overview and
Scrutiny. The last budget monitoring position was reported to Members in
March 2013 and identified a projected underspend on the revenue account of
£18,935, this report now presents the final budget monitoring position for the
year. The contents of this report will be considered by the Overview and
Scrutiny Committee on 26 June 2013.
1.4
At the time of preparing this report there are a number of final figures for
2012/13 which have not yet been confirmed and therefore estimates have
had to be made. This is not unusual due to the timing of producing the outturn
report and the lead in time for publication of committee papers. Some of these
figures are in relation to the benefit subsidy and Council Tax collection where
the system reports from the new Revenues and Benefits System have
needed further work/analysis to interpret. Any material adjustments to the
figures used within this report will either be reported at the meeting or
reflected in the draft Statement of Accounts when they are produced.
1.5
In addition there are still some entries that are required within the statutory
Statement of Accounts, for example impairment costs that are chargeable to
service accounts but are then reversed out therefore having no impact on the
overall general fund position. These will be entered in the published accounts
and will be fully reconciled to the position now reported. The draft accounts
must be produced by 30 June each year and then audited with the final
audited version being approved and published by 30 September. The audited
accounts will be presented to the Audit Committee on 17 September 2013.
2.
Revenue Account – Outturn 2012/13
2.1
The revenue account position for the year shows an underspend of £185,662
as detailed at Appendix A. This is after allowing for a number of transfers to
earmarked reserves for current and known commitments. As part of setting
the annual budget each year, the Council approves a policy framework for
earmarked reserves and the optimum level of the general reserve. Earmarked
reserves are typically used to set aside funds for known or specific liabilities.
Transfers to earmarked reserves have been made where an underspend has
occurred within a service mainly due to the timing of work not being
completed as planned and by 31 March 2013 and where no future budget
exists. Generally requests to transfer funds to earmarked reserves are made
where no specific budget exists in the following financial year. Further details
on the movements to and from reserves are included at section 3 of the
report. In addition where grants have been received in the 2012/13 financial
year but the expenditure has not yet been incurred, these amounts have been
carried forward within reserves at the year end.
Service Variances
2.2
The following sections of the report aim to highlight the more significant
variances compared to the revised budget and concentrate on the direct costs
and income. Comments on some of the smaller variances are also included
within Appendix B to the report.
2.3
Accounting standards require a number of notional charges to be made to
service accounts. Notional charges include transactions in relation to capital
charges and pension costs and whilst they do not have an impact on the
‘bottom line’ i.e. the surplus or deficit for the year, they are included for
reporting purposes. Appendix A shows the overall revenue position including
notional charges, however to assist the reporting and explaining ‘cash’
variances, table 1 provides a summary of the position excluding notional
charges.
Table 1 - 2012/13 Revenue Account (Excluding Notional Charges)
Revised
Actual £
Budget £
Assets & Leisure
1,635,375
1,586,094
CLT / Corporate
517,503
460,755
Community, Econ Dev & Coast
1,783,905
1,314,685
Customer Services
337,311
360,111
Development Management
1,016,108
912,472
Environmental Health
3,995,776
3,724,413
Finance
3,403,085
3,457,575
Organisational Development
327,246
336,102
Net Cost of Services
13,016,309
12,152,207
Parish Precepts
Net Interest Receivable/Payable
Capital Financing
Net Contributions to/(from) Earmarked
Reserves
Net Contributions to/(from) General Reserves
Net Expenditure to be met from
Government Grant & Taxpayer
Government Grants and Council Tax
Net (Surplus)/Deficit for year
Variance
£
(49,281)
(56,748)
(469,220)
22,800
(103,636)
(271,363)
54,490
8,856
(864,102)
1,538,934
(269,900)
460,501
1,538,934
(206,240)
630,253
0
63,660
169,752
(639,176)
(156,193)
482,983
(265,126)
(304,468)
(39,342)
13,841,542
13,654,493
(187,049)
(13,841,542)
(13,840,155)
1,387
0
(185,662)
(185,662)
2.4
Commentary on the more significant variances for direct costs and income is
provided in the following paragraphs. Further comments can be found within
Appendix B to the report.
2.5
Assets and Leisure
a)
Car Parks £67,773 underspend – Overall the car parks service has resulted in
a net favourable variance at the year end. The most significant is the
additional car park fee income of £58,794 and penalty charge notice income
of £21,194. These have been offset partly by increased administration fee in
respect of penalty charge notices.
b)
Parklands £15,420 overspend – The main reason for the year end overspend
is due to additional repairs and maintenance works in relation to a water leak.
c)
Foreshore £36,284 underspend – Of the underspend £28,900 has been
carried forward to 2013/14 for repairs and maintenance expenditure that was
not able to be completed during 2012/13 due to poor weather.
d)
Woodlands Management £17,338 overspend – The overspend within the
service is made up a number of smaller variances including emergency tree
works, staff turnover savings not achieved in the year and vehicle repair
costs.
e)
CCTV £15,083 underspend – The underspend in the year is largely due to
replacement cameras not being purchased in the year pending the current
review of the service.
2.6
Corporate
a)
Legal Services £47,033 underspend – Of the outturn position £34,623 relates
to additional legal fee income generated above the budget, this has been
transferred to an earmarked reserve to fund costs related to developing
Eastlaw to generate further income in the future.
2.7
Customer Services
a)
IT Support Services £24,166 underspend – The outturn position is made up of
a number of service variances including £11,815 underspend/credits in
respect of telephone calls, lines and contract credits received, £28,364
employee savings due to a vacant post. These have been offset by some
additional costs in the year in relation to computer software licences. Of the
overall saving, £6,480 is being used as a revenue contribution to capital to
finance the purchase of replacement computers in the year and £10,000 is
being carried forward to fund additional costs in the 2013/14 year for essential
upgrade work.
b)
Media and Communications £36,480 underspend – £16,562 of the outturn
position relates to graphics materials costs and external media work being
less than budgeted. There was also an underspend on paper costs in the
year of £8,536. The balance of the underspend is made up of a number of
smaller underspends including furniture and stationery purchases and training
costs. Part of the overall underspend has been used as a revenue
contribution to capital to fund the purchase of new scanners in the year.
2.8
Community and Economic Development
a)
Planning Policy £35,269 underspend – The most significant variance within
the service is in relation to Community Infrastructure Levy consultant fees
which have yet to be incurred, as such £20,000 has been rolled forward to
2013/14. The balance of the underspend relates mainly to employee turnover
and officer transport costs not incurred in the year.
b)
General Economic Development £31,597 overspend – The outturn variance
is largely due to grant income that is held in a reserve and is matched by a
transfer from reserves in the year.
c)
Coast Protection £59,897 underspend – The underspend represents delays
to planned sea defence works due to adverse weather and has therefore
been carried forward to 2013/14 within an earmarked reserve.
d)
Pathfinder £60,151 underspend – The year-end variance reflects an
underspend on the Integrated Coastal Management fund and has been rolled
forward to 2013/14 within the Pathfinder earmarked reserve.
e)
Community and Localism £130,011 underspend – This service includes the
items being funded from the second homes money that is returned to the
Council from Norfolk County Council, including the Big Society Fund (BSF)
grants, any underspend on the grants has been carried forward within the
BSF earmarked reserve. The underspend also includes some external grants
that have been received in the year but have not yet been expended, these
too have been carried forward within the Grants earmarked reserve.
2.9
Development Management
a)
Development Management £110,408 underspend – As reported during the
year within the budget monitoring reports the annual income budget has been
exceeded due to a number of large planning applications. £45,000 of the
additional income has been carried forward within an earmarked reserve to
fund temporary staff within 2013/14.
b)
Building Control and Access £47,946 overspend – The outturn position
reflects the reduction in income from building control fees.
2.10
Environmental Health
a)
Licensing £23,319 underspend - The outturn position reflects additional
general licensing income from new applications and variations to current
licences of £10,228 and £13,268 for additional taxi licensing income. Of the
net underspend £13,200 has been transferred to the Environmental Health
earmarked reserve.
b)
Environmental Protection £39,485 underspend – Of the underspend ££26,306
relates to employee and related costs due to vacant posts within the service.
Of the remaining variance there are a number of smaller underspends within
the services demand led budgets and also additional income/contributions for
assisted burials and towards noise equipment.
c)
Environmental Health, Service Management £22,085 underspend – The
variance at the year-end relates to savings in a number of supplies and
services budgets.
d)
Waste Collection and Disposal £87,329 underspend – The overall
underspend for the service is made up of a number of variances within the
service budget headings, including:
 Additional fee income from trade and garden waste customers of
£66,376;
 Higher recycling credits due to increased tonnages of garden waste
and glass being processed resulted in £23,301 being received above
the budget;
 Reduced profit share of £48,403 due to the reduced value of re-sale
materials;
 Recycling initiatives budget not fully spent in the year of £23,488, this
has been carried forward in the Environmental Health earmarked
reserve to fund additional promotional and marketing during 2013/14.
2.11
Finance
a)
Local Taxation £56,160 overspend – The main reason for the variance relates
to court costs not being awarded to the level of the budget. This was due to
court action not being taken in the year as a consequence of the
implementation of the new system, although it is anticipated that some of the
costs will be recovered in the 2013/14 financial year.
b)
Benefits £14,430 overspend – Whilst the net position on the service does not
show a significant variance from the revised budget, there are a number of
variances within the service. The outturn position includes net costs of
£102,485 in relation to the final subsidy claim for 2011/12, this has been
funded by a contribution from the benefits earmarked reserve which is
maintained for such purposes, i.e. to mitigate any in-year impact to the
revenue account. The outturn position takes into account the initial subsidy
claim for 2012/13 which will be audited later in the year. Due to the system
conversion and some backlog within the service the bad debt provision has
been reviewed to reflect these issues and a transfer has been made to the
benefits earmarked reserve to mitigate any impact from the final audited
subsidy return.
c)
Discretionary Payments £21,168 underspend – The variance relates to a
lower level of rate relief awarded in the year, the balance has been carried
forward to 2013/14 within an earmarked reserve.
d)
Corporate Finance £33,994 underspend – The year end variance is largely
due to employee costs not incurred due to a vacant post along with
advertising costs not expended in the year. £28,500 of the underspend has
been carried forward to 2013/14 for interim cover and recruitment costs in
2013/14.
2.12
Organisational Development
a)
Human Resources and Payroll £55,036 underspend – Of the year end
underspend £43,369 relates to the corporate training programme expenditure
being lower than expected; of the balance £9,924 is due to lower than
anticipated spend on printing and other professional fees and charges.
£20,000 has been transferred to the Organisational Development earmarked
reserve to cover costs relating to Investors in People accreditation and officer
restructuring and £5,000 has been transferred to the Common Training
reserve for Members' induction training.
b)
Policy and Performance Management £33,143 underspend – The outturn
position is made up of a number of savings within the service, including,
£8,048 employee cost savings, £9,606 consultation costs not incurred in the
year, £6,936 expenditure not incurred by the North Norfolk Youth Voice and
£6,304 on grants.
Non Service Expenditure and Income
2.13
The non-service expenditure and income predominantly relates to investment
income. The 2012/13 outturn position achieved from the Council’s treasury
management activity was £63,419 below the amount anticipated in the
revised budget. Investment income for the year was £206,481 at an average
rate of 0.82% from an average balance available for investment of £25.1m.
This compares to the revised budget which anticipated a total of £269,900
would be earned at an average rate of 1.1% from an average balance of
£24.6m.
2.14
The original budget for investment income in 2012/13 was £269,900 and was
unchanged for the revised budget. The rate of interest on the types of
investment the Council had been making was falling, and it was decided to
invest £5m in the LAMIT Pooled Property Fund to maintain the overall return
and meet the revised budget. However, it was not possible to make the
investment in the Fund until the 31 March 2013, and consequently there is a
shortfall which in line with the amount reported to members in the monitoring
reports from Period 10.
2.15
The Treasury Management Annual Report is included as a separate item on
this Agenda and provides more details on the performance of the Treasury
Management activity for the year
3.
Reserves
3.1
The Council holds a general reserve for which the recommended balance
was £1.6 million when the 2013/14 budget was approved in February 2013.
The general reserve is held for the purpose of providing a working balance to
help cushion the impact of uneven cash flows to avoid temporary borrowing
and also as a contingency to help cushion the impact of unexpected events or
emergencies. As part of approving the budget for the 2013/14 financial year
the general reserve recommended balance was increased from £950,000 to
£1.6 million. The reason for the increase was in response to the significant
changes that have been introduced to the funding of Local Authorities from
2013/14 onwards, essentially from a fixed formula funding mechanism to one
whereby funding is related to the local raised business rates and also the
introduction of the Localised System of Council Tax support.
3.2
Since recommending the minimum balance of £1.6 million Cabinet have
received a report (13 May 2013) on the use of the New Homes Bonus (NHB)
from 2013/14. The report (subject to Full Council approval) recommended the
use of the New Homes Bonus from 2013/14 onwards within the base budget,
in approving this it was recommended that £600k of the unallocated NHB
within the NHB earmarked reserve be reallocated to the general reserve to
mitigate the impact of future changes to the NHB within the overall funding
formula.
3.3
In addition to the general reserve a number of earmarked reserves are held to
meet known or predicted liabilities. The earmarked reserves provide a means
at the year-end for carrying funds forward to the new financial year to fund
ongoing commitments and known liabilities for which no separate budget
exists in future financial years.
3.4
Section 2 of the report highlighted some areas where an underspend had
occurred in the year and a transfer to reserves had been made to ensure
funds are available to meet future spending commitments. Unlike capital
budgets, underspends on revenue budgets in the year are not automatically
rolled forward at the year-end where there is an annual budget provision.
Where the underspend represents a grant received which has not yet been
fully utilised or there has been a delay in the planned use, the unspent grant
has been rolled forward.
3.5
The transfers to and from reserves (general and earmarked) are included
within the reserves statement as detailed at Appendix C. The overall position
gives a total of reserves of £7,978,968 at 31 March 2013. The appendix also
shows the planned use of reserves over the medium term to take account of
where funding has been rolled forward from 2012/13 for use in 2013/14.
3.6
The general reserve balance at 31 March 2013 is £1,745,452. After taking
into account the budgeted contributions to and from the reserve in 2013/14,
the forecast balance at 31 March 2014 is £2,030,868, although this does
include £400,000 within the reserve which the current financial forecast
assumes will be used over the following two financial years, excluding this
leaves an unallocated balance of £1,630,868.
4.
Summary – Revenue Account 2012/13
4.1
The outturn position for the year ending 31 March 2013 is a £185,662. This is
after allowing for a number of underspends identified at the service level
which have been rolled forward within reserves to fund ongoing commitments
in 2013/14. It is recommended that the surplus for the year be transferred to
the Invest to Save reserve which could then be used fund investment
decisions related to the ICT and Customer Improvement Strategies. Release
of the funds from the reserve would be subject to the sign-off of relevant
business cases by the Transformation Board which is made up of the Leader,
Portfolio Member and Officers.
5.
Capital Programme 2012/13
5.1
This section of the report presents the financing of the capital programme for
2012/13, along with an updated programme for the financial years 2013/14 to
2015/16. Appendix D provides the detail of the outturn on the 2012/13 capital
programme for all service areas, together with the financing for all schemes.
The updated capital programmes for the period 2013/14 to 2015/16 are
attached at Appendix E.
5.2
The outturn position for the 2012/13 capital programme, at Appendix D,
highlights where schemes have slipped between financial years. The
reasons for slippage include where schemes have not progressed as
originally planned and the funding is requested for carry forward to the new
financial year, or where schemes have progressed ahead of schedule
requiring funding to be brought back from 2013/14. The following paragraphs
provide further explanations and where necessary commentary on individual
schemes in the capital programme, which are now reported in line with the
subheadings used in the Corporate Plan. The details include the outturn
expenditure compared to the 2012/13 budget, and explanations of variances
where applicable.
5.3
In total, the expenditure on the capital programme for the year was
£4,545,815, compared to a revised budget of £11,650,111, giving a variance
of (£7,104,296). There has been a requirement to claw back a total of
£29,618 from the 2013/14 budget where schemes have progressed faster
than originally anticipated. In addition to this there is significant slippage of
(£7,117,695), together with other movements in year totalling a net (£16,219).
5.4
The following three paragraphs provide summary commentary where actions
on schemes have been similar at year end :-
a)
Budget Claw Backs – There were 6 schemes in total that have either started
slightly earlier than anticipated, or where the spend level in the year was
higher than anticipated. Where this is the case, and there is budget available
within the 2013/14 capital programme, this has been clawed back in order to
cover the expenditure incurred in year. The updated programme for 2013/14
onwards (Appendix E) reflects these adjustments to the capital programme.
The schemes and amounts are listed in table 2.
Table 2 – Capital Schemes Claw Back Required from 2013/14 Budget
Capital Scheme
Claw Back Amount
£
Car Park Resurfacing and Refurbishment
26,077
Playground Improvements
3,000
Other Schemes
541
Total
29,618
b)
Schemes Completed in Year – Overspent - A total of eight capital schemes
were completed in year with overspends. The schemes and amounts of
overspend are listed in table 3, together with the source of the additional
financing.
Table 3 – Capital Schemes Completed in Year with Overspends
Capital Scheme
Cromer Red Lion Toilet
Refurbishment
Car Park Ticket Machines
Sheringham East Prom PC
Sheringham Little Theatre
SMP Preparation of Studies
Amount
£
4,484
Source of Additional
Financing
Capital Receipts
1,346
6,350
8,198
3,162
Capital Receipts
Capital Receipts
Capital Receipts
Environment Agency
Grant
Capital Receipts
Other Schemes
Total
c)
1,064
24,604
Schemes Completed in Year – Under Budget – Within the 2012/13 financial
year a further four schemes have been completed within budget, with the
remaining balance of budget no longer being required. These schemes are
identified within table 4, together with the budget sums to be relinquished.
Table 4 – Capital Schemes Completed in Year – Under Budget
Capital Scheme
Fakenham Factory Extension
Asbestos Works
Openwide Loan Repayment
North Walsham Public Conveniences
Total
5.5
Amount
£
(23,256)
(1,634)
(495)
(1,619)
(27,004)
In addition to these scheme there are further explanations of other significant
variances on a scheme by scheme basis below:-
a)
Fakenham Industrial Estate – This scheme has been in existence for a
number of years, with the balance of budget being taken forward to cover any
additional expenditure. As the scheme is now complete Cabinet are
requested to remove the remaining budget of £6,736 from the capital
programme.
b)
Carbon Reduction Scheme – The current plans for the Carbon Reduction
Scheme relate solely to the improvement of water usage at NNDC public
conveniences. The value of works arising from this scheme are estimated at
£5,000, with a budget of this value being requested for slippage to the new
financial year. The remaining budget of £34,939 is no longer required and is
to be removed from the capital programme for 2013/14.
c)
Equity Loans – A total of £47,000 has been received in the year as part of a
funding initiative from East of England Regional Assembly (EERA), for the
provision of equity share loans to enable properties to be improved. A total of
£19,845 has been paid to owners or tenants to facilitate this process in the
2012/13 financial year, and the balance of funding has been taken to
Receipts in Advance. This scheme has been incorporated into the capital
programme for 2013/14, with a balance of £27,155 being included as the
amended budget for the year.
d)
Big Society Fund - During 2012/13 the value of capital grants made from the
Big Society Fund has exceeded the revised budget, with additional
expenditure of £82,000 being incurred in year. Although this has been offset
by an equivalent reduction in revenue grants, the additional expenditure will
be financed in year from capital receipts. This has resulted in a net increase
in the overall Big Society Fund capital budget by £82,000 which has been
reflected in the capital programme information included at Appendix D.
e)
Street Signs Improvement Programme – The original intentions of this
scheme have been delivered, and as such there is no future requirement for
the £25,825 balance of budget. This is to be removed from the capital
programme for 2013/14 onwards.
f)
Personal Computer Replacement Fund – In 2012/13 there was a requirement
to replace all personal computers within the Benefits section, in order for the
section to function efficiently. The over spend in year of £6,480 is to be
financed in year from revenue contribution, and will result in a net increase to
the overall PC Replacement Fund capital budget by an equivalent sum. This
has also been reflected within the capital programme shown in Appendix D.
g)
Fakenham Connect – This scheme has been completed, and there is no
future requirement for the £6,218 balance of budget. This scheme is
therefore to be removed from the 2013/14 capital programme.
h)
Fakenham Community Centre – This scheme has been completed, and there
is no future requirement for the £8,720 balance of budget. This scheme is
also to be removed from the 2013/14 capital programme.
5.6
In addition to the above there have been a number of schemes where
slippage of budgets in excess of £100,000 have been identified from the
2012/13 budget to the new financial year. This has arisen mainly due to
delays in scheme implementation, and more accurate re-profiling of these
expenditure budgets will be undertaken as part of the Capital Budget
Monitoring Process in the new financial year. These schemes have been
summarised in Table 5.
Table 5 – Slippage on Capital Schemes in Excess of £100,000
Capital Scheme
Disabled Facilities Grants
Empty Homes
Gypsy and Traveller Short Stay Stopping Facilities
Cromer Pier Structural Works (Phase 2)
Cromer Coast Protection Scheme 982
Pathfinder Project
Trade Waste Bins/Vehicles
Procurement for Upgrade of Civica System
Administrative Buildings
Total
Amount
£
(127,536)
(199,050)
(305,646)
(726,655)
(4,636,290)
(312,232)
(121,688)
(163,240)
(137,220)
(6,729,557)
6.
Capital Programme –2013/14 Update
6.1
Appendix E shows the updated capital programme for the period 2013/14 to
2015/16. The programme has been updated to take into account the slippage
as identified within this report and the capital outturn appendix. Alongside
these changes, the capital programme has also been updated for the
following amendments / additions.
6.2
Carbon Reduction Scheme – As identified in paragraph 5.5(c) the budget
requirement for this scheme has been reduced to £5,000 in 2013/14. As such
the balance of budget of £34,939 as at the end of the 2012/13 financial year
has been removed from this schemes total budget requirement.
6.3
Equity Loans – As discussed above in paragraph 5.5(d) a sum of £47,000 has
been received for the provision of equity share loans in order to facilitate
approved home improvements. The total provision of £47,000 has been
included within the capital programme, with £19,845 of this money already
having been spent in the 2012/13 financial year. The balance of the monies
from EERA, of £27,155, has been included as the amended budget for
2013/14.
6.4
Gypsy and Traveller Short Stay Stopping Facilities – There was slippage of
£305,646 requested into the 2013/14 financial year. Of this sum a total of
£260,000 has been re-profiled into subsequent financial years in order to
reflect more accurately the accounting period to which this scheme relates.
6.5
Big Society Fund – During the 2012/13 financial year an additional £82,000 of
expenditure was incurred in relation to capital grants made from the Big
Society Fund throughout the year. The overall budget for the Big Society
Fund has been increased by this value to reflect the additional expenditure
already incurred, thereby leaving a full £200,000 to be available for the
2013/14 financial year for the Big Society Fund/Enabling Fund as reported to
Members in April 2013.
6.6
Personal Computer Replacement Fund - Following the requirement to replace
all Benefits Computers during the 2012/13 financial year, as identified within
paragraph 5.5(g), the overall budget for this scheme has been increased by
£6,480. This increase will ensure that the budgets of £20,000 per annum for
the 2013/14, 2014/15 and 2015/16 financial years, are still available.
6.7
Budget Claw Backs – As discussed above during 2012/13 there were 6
projects that either started earlier than anticipated or where the expenditure
incurred in year was higher than anticipated. Where there was budget
available in 2013/14, this was clawed back to 2012/13 to cover the additional
expenditure. The updated programme for 2013/14 onwards (Appendix E)
reflects these adjustments.
6.8
Committee Management Information System (CMIS) – This report
recommends approval of £16,000 within the 2013/14 capital programme for
an electronic committee management system. Following the review and
subsequent merger of the administrative and democratic services teams the
need for an electronic committee management system was identified. The
system will support improved performance and productivity to underpin the
corporate administration and democratic services functions for the Council.
Currently there is no electronic committee management system used in the
service with committee and meeting agendas and papers being produced
manually in pdf format.
6.9
The financing of the amended capital programme is detailed within Appendix
E. The financing at this point in the year assumes capital receipts totalling
£5,366,265 will be used to finance schemes in 2013/14. The progress of
achieving the capital receipts as forecast will continue to be monitored as part
of the budget monitoring process.
7.
2013/14 Budget Implications and Financial Forecast 2014/15 Onwards
7.1
The budget for 2013/14 was approved in February 2013. At the same time
financial projections for the following three years to 2016/17 were also
presented. The budget for 2013/14 includes new savings and additional
income totalling £163,000, these are in addition to the ongoing savings of
£897,000 from the 2012/13 financial year. The budget for 2013/14 and future
financial forecasts also take account of the new system of Local Government
Finance for which the key components are the local council tax support
scheme and the retention of business rates which came into effect from April
2013.
7.2
The forward projections take account of the provisional finance settlement for
2014/15 announced at the time of the 2013/14 settlement and forecast
funding reductions of up to 25% over the next three years. Based on the
assumptions at the time of approving the budget for 2013/14 the forecast
funding gap by 2016/17 was £2.272 million. Since approving the budget for
2013/14, Cabinet have recommended (subject to Full Council decision) that
the New Homes Bonus grant be taken into the base budget from 2014/15
onwards. As reported to Cabinet in May 2013, this will reduced the forecast
deficit (based on current expenditure and income projections) as illustrated in
the table 7.
Table 7 – Current Funding Forecast
2014/15
£000
Current Funding Gap1
917
Use of NHB
(821)
Revised Funding Gap
96
2015/16
£000
1,552
(936)
616
2016/17
£000
2,272
(1,051)
1,221
7.3
The forward projections of expenditure and income are in the process of
being updated to take account of the outturn position and also other
spending/income pressures where applicable. These will be reported to
Members in the coming months to enable early preparation for the 2014/15
budget process.
8.
Financial Implications and Risks
8.1
There are a number of financial risks facing the authority in terms of the
changes to Local Authority Funding in particular the Local Council Tax
Support Scheme and Local retention of Business rates which came into effect
in April this year. These where reported in detail within the budget report and
the general reserve was increased in response to these risks.
8.2
This outturn report has identified a number of underspends at a service level
where due to some constraints outside of the Council’s control has meant that
expenditure has not been incurred as planned, for example coast protection
and repairs which were restricted by weather. These underspends have been
carried forward within earmarked reserves to mitigate any overspends in the
2013/14 financial year.
8.3
Benefits subsidy (Housing and Council Tax for 2012/13) does present a
financial risk in terms of the size of the expenditure on the service, for
2012/13 the expenditure was in the region of £37 million with comparative
levels of subsidy recovered. Whilst the initial subsidy claim for 2012/13 has
been submitted, there are risks as a result of the system conversion mid year
which could have an impact on the final audited subsidy return. Much of this
risk is reduced by the benefits earmarked reserve which is maintained to help
mitigate the impact of any claw back from the Department for Work and
Pensions following the final audited subsidy claim.
9.
Sustainability – None as a direct consequence of this report.
10.
Equality and Diversity – None as a direct consequence of this report.
11.
Section 17 Crime and Disorder considerations – None as a direct
consequence of this report.
1
As reported in the 2013/14 Budget Report