Cabinet
Overview and Scrutiny
12 March 2012
28 March 2012
Agenda Item No______8_______
BUDGET MONITORING 2011/12 – PERIOD 10
Summary:
This report presents the budget monitoring position for the revenue account and capital programme to the end of period 10 (31 January
2012) and also includes a review of the current capital programme.
Conclusions:
Recommendations:
The position at the end of January 2012 is showing a projected underspend of £21,807. The overall position will continue to be monitored over the remaining periods of the current financial year.
It is recommended that:
1) Cabinet note the contents of the report and the revenue account forecast for the current financial year;
2) That Cabinet note the current position in relation to the 2011/12 capital programme;
3) Delegated Authority is given to the Chief Executive and the
Strategic Director Community in consultation with the relevant Cabinet
Portfolio Members to set the new planning fees covering preapplication and ‘Do I need planning permission’ enquiries.
Ward(s) affected: Cabinet member(s):
All
Contact Officer, telephone number, and e-mail:
1. Introduction
All
Duncan Ellis, Acting Financial Services Manager, 01263
516330, Duncan.Ellis@north-norfolk.gov.uk
1.1 This report compares the actual expenditure and income position at the end of January
2012 to the revised budget for 2011/12 as reported to Cabinet on 28 November and approved by Full Council on 14 December.
1.1. The budget monitoring position at the end of period 9 was presented to Cabinet and
Overview and Scrutiny in February. That report included a detailed commentary on the variances to the end of December 2011 and also the Treasury Management Quarterly
Report. The reason for taking two consecutive period budget monitoring reports so close to the year end is to allow sufficient time for any actions to be taken where necessary and appropriate to ensure that the revised budget for the current year remains achievable. This report for period 10 aims to provide an overview of the more significant variances and appraise Members of the forecast year end position.
1.2. The latest budget monitoring for schemes within the current capital programme is included in this budget monitoring report at section 7 and also within Appendix A.
1.4 The outturn position for 2011/12 will be reported to Cabinet and Overview and Scrutiny
Committee in June 2012.

Cabinet
Overview and Scrutiny
12 March 2012
28 March 2012
2. Background
2.1 Budget monitoring is carried out on a monthly basis with service managers and those officers with budget responsibility. The detail within this report highlights the more significant variances against the profiled budget to date along with those which are expected to have a year end variance and also where applicable to recommend action to be taken to ensure that the overall budget remains achievable.
2.2 As outlined at 1.1 the budget has been revised during the year and was approved by Full
Council in December. The revision of the budget part way through the year allows for the individual budgets to be updated to take account of the latest position and also to reflect variances previously reported and allows for proactive measures to be taken where necessary to maintain a balanced budget position for the year.
2.3 Within both the last budget monitoring report and this report Budget Managers have started to highlight some full year underspends where they would like to carry the budget forward to the new financial year. Unlike capital budgets, revenue budgets are set for the year and underspends for the year are not automatically rolled forward. Where a revenue budget does remain unspent at the year end for which there is an annual budget provision, this is not automatically carried forward. If the underspend relates to expenditure being funded from earmarked reserves and the underspend has occurred due to timing, for example a delay in carrying out the planned work then these funds will normally be carried forward. For all other underspends or additional income received in the year any requests to carry these forward at the year end will be considered as part of the outturn process and will take into account the overall financial position compared to budget at 31 March 2011.
2.4 In contrast, capital budgets are allocated to a capital scheme when it is approved, where the scheme has either progressed ahead of schedule or has not progressed as previously anticipated the capital budget can be reprofiled to a different year, i.e. the budget is slipped to a later year or brought forward and no separate request is made to carry the capital budget forward.
3. Budget Monitoring Position – Revenue Services
3.1 The general fund summary (Appendix B) shows the overall high level position at the end of period 10 and is currently showing a year to date variance of (£936,967). Further details on each of the service areas are included within Appendix C.
3.2 The following tables provide details for each of the service areas, the more significant variances along with those which are anticipated to have a full year effect. Some services that are predicting a full year underspend have made a request to carry underspend forward to the new financial year. All requests to carry forward year end underspends will be considered as part of the final accounts process, once the overall financial position for the year is known.

Cabinet
Overview and Scrutiny
12 March 2012
28 March 2012
Community
Development Management – As part of the original base budget additional income was predicted to be generated from a new local fee setting scheme which was anticipated to start during 2011/12. This was in part adjusted for at
Revised budget but now looks unlikely to happen in the near future and represents
£60,000 of the full year effect. This variance has been reflected within the savings table below within section 4 below. The £6,000 balance relates to professional fees for 2 planning appeals that are currently ongoing.
Planning Policy – the current underspend relates to a delay in respect of professional fees
(£10,113) for work on the Community
Infrastructure Levy (CIL) report and viability assessment which will now be commissioned in
April. This is anticipated to result in a full year effect and £15,000 and will be requested as a carry-forward as part of the year end process so full year effect is anticipated.
Landscape – this underspend relates to the
North Norfolk Biodiversity Strategy (£10,000) which has not been undertaken and expenditure to be funded by an Area Based Grant (£15,000) which has not yet been incurred. It is likely that this budget will need to be carried forward to
2012/13 if not spent in this financial year.
Building Control & Access – officer mileage claims are currently lower than anticipated
(£6,484), which is expected to have a full year effect of (£10,000). However this has been offset by an unfavorable year to date variance of
£24,008 in relation to fee income as building activity continues to be slow because of the recession and a full year effect of £30,000 is anticipated at the year end.
Local Land Charges – Income generated from land search fees is currently down and is anticipated to have a full year effect of £10,000.
Sub Total Community
Over/(Under) spending to date
Estimated full year effect
Performance
Indicator at
Period 10 where applicable
£ £
48,674 66,000 1,278 applications have been received to
P10 in the current year compared with
1,218 for the same period in
2010/11
(8,347)
(29,243)
15,490
10,460
37,034
0
(10,000)
20,000
10,000
86,000

Cabinet
Overview and Scrutiny
12 March 2012
28 March 2012
Environment
Licensing – overall there is only a minor variance of (£800) showing against this service but taxi testing costs are currently (£2,548) under budget and this is anticipated to result in a full year effect.
Environmental Protection – this underspend is made up of a number of minor variances, the most significant being (£4,779) income relating to works in default and fixed penalty notices which is expected to result in a full year effect.
Parks & Open Spaces – this service is currently showing an underspend of (£43,714). Of this
(£15,297) relates to lower than anticipated expenditure on grounds maintenance. Tree works and landscaping works are due to be undertaken before the year end. A commuted sum of (£32,500) has been received for maintenance in respect of land at Aylsham
Road, North Walsham which had not previously been budgeted for and this will be transferred to the Grassed Area Deposits reserve at the end of the year.
Sports Centres – the variance to date reflects lower than anticipated income from sports halls compared to the year to date budget, although this is not expected to have any full year effect at present.
Over/(Under) spending to date
Estimated full year effect
Performance
Indicator at
Period 10 where applicable
£ £
(800) (3,000)
(14,413)
(43,714)
2,134
(13,400)
(4,000)
(32,500)
0 Dual use and sports hall usage April to
December
Actual 449,661
Target
415,475
(10,000) Leisure Complexes – the majority of this variance (£14,741) relates to repairs and maintenance savings at the Splash leisure centre. This is anticipated to result in a full year saving of £10,000.
Pier pavilion – the variance showing of (£4,750) relates mainly to savings for repairs and maintenance at the pavilion theatre and an anticipated full year saving of £5,000 is expected.
Foreshore Community – this variance has arisen due to receiving £3,750 less than the anticipated contribution budget for the lifeguards at East Runton. This is expected to have a full year effect of £4,000.
Waste Collection and Disposal – The overall position at the end of period 10 shows an underspend due to lower than anticipated
(5,740)
3,387
(13,348)
(5,000)
4,000
(3,700) Recycling rate for all recyclables up

Cabinet
Overview and Scrutiny expenditure relating to collection and disposal costs for clinical and hazardous household waste (£15,270) and reduced postage costs connected to garden waste (£3,651). This is partly offset by reduced recycling credit income due to lower recycling tonnages and overall a full year effect of (£3,700) is forecast.
Cleansing – this underspend relates to staffing costs (£8,625) which are to be retained to undertake additional work before the year end, and additional income from dog and litter bin recharges of (£1,288) which is expected to have a minor full year effect.
Sub Total Environment
(9,913)
12 March 2012
28 March 2012 to the end of
January is
44.75% (based on estimates for disposal).
(1,300)
(95,807) (55,500)
Information
Member Services – the variance relates to savings on Members travel, subsistence and allowances (£7,381) and savings on computer hardware purchases (£3,526). These variances are expected to produce a full year saving.
Legal Services – the current underspend relates to training days (£8,050) and licenses
(£4,930) for the new case management system which have yet to be invoiced.
Media and Communications – there is currently a variance of (£11,091) showing against this budget heading. The main variances relate to savings on paper costs (£1,970) and graphics materials (£5,355). The full year effect is therefore a saving of (£7,000).
Customer Services, Corporate – The reason for the underspend to date is due partly to lower than anticipated mileage allowances (£3,870), and additional postage recharges (£8,222) and other minor variances. At present no full year effects have been anticipated.
Sub Total – Information
Over/(Under) spending to date
Estimated full year effect
Performance
Indicator at
Period 10 where applicable
£ £
(11,476) (10,000)
(16,965)
(11,091)
(18,513)
(58,045)
0
(7,000)
0
(17,000)

Cabinet
Overview and Scrutiny
12 March 2012
28 March 2012
Car Parking – there is a current underspend showing against direct costs of (£51,912), this relates mainly to contract costs of (£70,314) that have not yet been invoiced and this has been offset by additional repairs and maintenance costs £9,446 and additional rental costs
£11,062. The repairs and maintenance and rental budgets are anticipated to have a full year effect of £28,300. However these additional costs have been offset by additional income which is showing a year to date variance of
(£14,414). This relates mainly to additional fee income (£4,876), additional penalty charge notices (£18,812) and an insurance reimbursement of (£3,000). This has been partly offset by a reduction in season ticket income of
£13,209 but overall it is anticipated that there will be a favourable full year effect of (£46,000) in relation to income levels. Once this is offset against the anticipated overspend of £28,300 the net full year effect is (£17,700).
Markets – the underspend relates to reduced overtime costs (£1,078), reduced expenditure on repairs and maintenance spend (£1,250) and reduced contract costs (£16,420) following the internalisation of car parks management. The income is also showing a favourable variance of
(£14,571), and taking all of these variances into account a full year effect of (£22,215) is anticipated. However, a virement of £9,315 is to be made to the CCTV budget to address critical
IT server issues. Although the CCTV service area currently forms part of a wider review, a number of servers need to be replaced to ensure the continuation of the service in the immediate future. Officers have been able to secure second hand units at a much reduced cost. The adjusted full year effect is therefore
£12,900.
Handyman – the main variance of (£22,188) relates to revised hourly rates for the handyman recharges, although no full year effect is expected as there will be additional costs in other services to reverse this recharge.
Personnel and Payroll Support Services – of the underspend showing at present (£8,536) spending to date full year effect
Indicator at
Period 9 where applicable
£ £
(66,326) (17,700)
(35,579)
(25,848)
(40,170)
(12,900)
0
(11,000)

Cabinet
Overview and Scrutiny relates to salaries and oncosts and (£32,372) to the corporate training programme. Some of this budget may be required to cover additional work over the next 2 months in relation to pay and grading and the senior management restructure and so the anticipated full year effect is
(£11,000).
Corporate Finance – the majority of the underspend relates to staffing costs and will be the subject of a carry forward request in order to support the additional work that will be required to implement some of the proposals from the
Finance Bill, such as the localisation of council tax benefit and business rates, due to be implemented from 2013/14.
Policy and Performance Management the majority of the current variance is due to expenditure not yet incurred in relation to North
Norfolk Youth Voice (£9,258) and a number of other minor variances. There has also been a grant repayment received of (£5,000) and overall a full year effect of (£10,000) is anticipated.
Investment Properties – while there is an overall variance currently showing of £7,911, the majority of this relates to service charges for the
Rocket House that are waiting to be invoiced.
Additional chalet income of (£7,500) is expected in this financial year and this has resulted in the full year effect shown.
Coast Protection – the underspend in this area is a result of delays in undertaking sea defence works and a reduction in associated consultancy costs. A full year underspend is anticipated
(£135,000) which will be rolled forward and spent in 2012/13, and relates to the following works programme - ET4301 Sheringham West
Stage 3 - £120k budget anticipate £10k full year spend; ET4301 Mundesley Apron - £40k budget anticipate £20k full year spend; external consultancy £5,000 underspend. There have been delays in commencing the works due to capacity issues as the Assistant Coastal
Engineer post currently remains unfilled.
Interviews for the post were held last week but no appointment was made following this process and the position will now be considered following the next phase of the senior management restructure. These works will now be scheduled for completion during 2012/13, and hence no full year effect is anticipated.
Pathfinder – any underspends in relation to the
Pathfinder grant monies at the end of the year will be subject to carry-forward requests or held
(10,158)
12 March 2012
28 March 2012
0
(29,127) (10,000)
7,911
(107,509)
(313,883)
(7,500)
0
0

Cabinet
Overview and Scrutiny
12 March 2012
28 March 2012 within a reserve where scheme costs are expected to continue beyond 2012/13.
Community Safety – the Council was due to provide a contribution to Victory Housing Trust towards the cost of the Anti Social Behavior coordinators post. The appointment was however made later than expected and has resulted in an underspend of (£9,301). There are further variances in relation to professional fees
(£5,850) and computer licenses (£2,920), and a full year saving of (£10,200) is anticipated.
(20,976) (10,200)
Corporate and Democratic Core – there is an underspend currently showing for this service area but the council is still due to receive an invoice for £7,107 in relation to external audit fees for 2010/11. A full year effect is also expected due to additional work that was required for the benefits grant certification work.
Corporate Leadership Team – following the restructure of the former Corporate Management
Team a full year saving is anticipated due to the changes relating to the post of the Chief
Executive officer. The costs for these changes will be met from the Restructuring Proposals reserve.
Sub Total Resources
Planning and Building Control
(10,907)
(5,523)
10,000
(25,000)
(658,095) (84,300)
4. Budget Monitoring Position – Savings and additional income 2011/12
4.1 As part of the budget setting process for 2011/12 a number of savings and additional income streams were identified and recommended for approval within the report presented to Cabinet on 14 February 2011. The following table provides details of the amounts included within the 2011/12 base budget along with an updated forecast for the current year. Where a variance is shown comments have been provided within section 3 above.
Table 1 – 2011/12 Savings and Additional Income
Service Area 2011/12
Base
Budget
£
35,707
2011/12
Revised
Budget
£
35,707
2011/12
Updated
Forecast
£
35,707
Variance against
Revised
£
0
Conservation and Design
Land Charges
Regeneration Management
Housing Service
Environmental Health
Sports Centre
Media and Communications
Legal Services
10,000
8,587
4,000
21,337
8,400
10,115
47,240
55,000
10,000
8,587
4,000
21,337
8,400
10,115
47,240
55,000
10,000
8,587
4,000
21,337
8,400
10,115
47,240
55,000
0
0
0
0
0
0
0
0
Customer Services
Car Parking Management
10,544
40,000
10,544
40,000
10,544
40,000
0
0

Cabinet
Overview and Scrutiny
12 March 2012
28 March 2012
Service Area
Revenues and Benefits
Organisational Development
Financial Services and Internal Audit
2011/12
Base
Budget
£
77,254
56,284
68,800
2011/12
Revised
Budget
£
77,254
56,284
68,800
2011/12
Updated
Forecast
£
77,254
56,284
68,800
Variance against
Revised
£
0
0
0
Partnership and Community
Engagement
Sub Total Savings
Additional Income/Grant:
Planning Fee Increase
New Homes Bonus
Homelessness Prevention Grant
Leisure Facilities Income
Car Parking
Sub Total Additional Income/Grant
Total Savings/ Income
105,000
37,718
20,000
578,188
105,000 105,000
558,268 558,268 558,268
50,000
350,000
0
350,000
7,718
20,000
0
350,000
120,470 120,470 120,470
7,718
20,000
498,188 498,188
1,136,456 1,056,456 1,056,456
0
0
0
0
0
0
0
0
0
(Note – All savings are shown gross. Any one off redundancy or severance costs associated with delivering these savings will be met as one off costs from the
Restructuring Proposals reserve).
4.2 The majority of the planned savings are still on target for the current year, as detailed within section 3 above.
5.1 The revised budget for 2011/12 anticipated that a net total of £462,000 would be earned in interest. This assumed an average balance of £26.2m at a rate of 1.77%.
5.2 There is a favourable variance of £96,223 at period 10 following the sale of £4m of
European Investment Bank bonds. Current investment rates are lower than the rate which would have been earned on these bonds, consequently by the year end the variance is anticipated to be £68,000. Overall, the total interest figure for the year is currently forecast to be £530,000 from an average balance of £25.8m at 2.06%.
5.3 This is an improvement on the position at period by 9 when a total of £521,800 was anticipated by the year end. The additional interest is mainly a result of achieving better than anticipated investment rates on money market fund investments.

Cabinet
Overview and Scrutiny
12 March 2012
28 March 2012
6. Budget Monitoring Position – Summary
6.1 The following table provides a summary of the full year projections for the four service areas along with an updated use of reserves figure where applicable.
Service Area Estimated Full Year
Effect
£
Community 86,000
Environment (55,500)
Information (17,000)
Resources (84,300)
Service Variance Total
Contributions to/(from) Reserves:
General Fund Reserve
EIB Reserve
Other Reserves
Non Service Expenditure and Income
(70,800)
0
84,493
32,500
(68,000)
Total Impact (21,807)
6.2 Overall the revenue position shows a projected underspend of £21,807. All requests to carry forward year end underspends will be considered as part of the final accounts process, once the overall financial position for the year is known. Following the allocation of carry forwards any unallocated underspend would be transferred to the restructuring reserve at the year end, to be used to fund one-off restructuring costs from 2012/13. The overall position will continue to be monitored over the coming weeks leading up to the year-end.
7. Budget Monitoring Position – Capital
7.1 An update of the capital programme was presented to Members on the 6 th
February
2012, as part of the base budget report.
7.2 Appendix A shows the latest position against the current 2011/12 approved programme, and provides details of the expenditure up to the end of period 10. This appendix has been updated to include the additional budget of £15,000 for the emergency works to be undertaken on the roof of the Mundesley public conveniences, which was approved by
Cabinet in February 2012 as part of the Period 9 Budget Monitoring report.
7.3 In addition to this a further virement of £42,000 has been incorporated into the appendix, from the BPR EDM scheme. This is to cover the additional costs identified as part of the tendering process for the Sheringham East Prom Public Convenience scheme and was approved as part of the 2012/13 budget recommendations by Full Council on 22
February 2012. A revenue contribution to capital outlay (RCCO) of £11,915 was also agreed as part of the Full Council report in relation to the Red Lion toilets, and this has also now been reflected within appendix A.
7.4 Expenditure on the Provision of Electricity at Holt Country Park is £1,562 in excess of the agreed budget. The revised budget for this scheme is £21,522, of which £13,000 is to be financed from capital receipts with the balance from an RCCO. The excess of £1,562 will be financed through an additional transfer from revenue at the year end.

Cabinet
Overview and Scrutiny
12 March 2012
28 March 2012
7.5 Slippage has been identified for the Housing Associations budget, in total it is anticipated that £2,011,582 will need to be slipped from the 2011/12 revised budget, into the new financial year. This has arisen due to funding requirement delays in relation to several schemes covered by the budget. Slippage of capital budgets into 2012/13 is shown within the appendix for information, but will be reported for approval as part of the outturn report which will be presented to Members in June.
8. Implications to the Council
8.1 The detail within section 3 of the report outlines the significant variances against the profiled budget to the end of period 10 and also those anticipated to have a variance at the year end. Overall the total of the projected service variances at the year end highlights an underspend of £21,807. Therefore the current forecast for the year assumes that the revised budget remains achievable.
8.3 The overall budget will continue to be monitored by officers and reported to Members on a regular basis.
8.4 As part of the savings report presented to Cabinet on 28 November 2011 for the 2012/13 budget there were two new income streams recommended within the Development
Management area (savings bid C5 – introduction of fee charging for pre-application advice and C6 - introduction of fee charging for the Certificate of Proposed Lawful
Development). These were subsequently included within the 2012/13 budget which was approved by Full Council on 22 February 2012. It is therefore requested that Delegated
Authority be given to the Chief Executive and the Strategic Director Community in consultation with the relevant Cabinet Portfolio Members to set the new planning fees covering pre-application and ‘Do I need planning permission’ enquiries.
9. Recommendations
9.1 It is recommended that:
1) Cabinet note the contents of the report and the revenue account forecast for the current financial year;
2) That Cabinet note the current position in relation to the 2011/12 capital programme;
3) Delegated Authority is given to the Chief Executive and the Strategic Director
Community in consultation with the relevant Cabinet Portfolio Members to set the new planning fees covering pre-application and ‘Do I need planning permission’ enquiries.