Issue - meetings

To consider a report of the Director of Finance and Business Services.

The Committee considered a joint report of the Director of Finance and Business Services and Places and Organisational Capacity summarising the financial and non- financial performance of the Council at the three year review stage of 2011/12.

Annex 1 of the report provided an update on the overall Financial Stability of the Council, including the positions on Grants, Council Tax and Business Rates, Treasury Management, Centrally held budgets, and the Management of the Council’s Reserves.

Annex 2 provided projections of service financial performance for the 2011-12 financial year. It focused on the key financial pressures which the Council’s services were facing, and areas of high financial risk to the Council, and highlighted significant changes to forecasts since the mid year review.

Annex 3 provided a summary of the key performance headlines at the end of Quarter Three.

The Director of Finance and Business Services drew attention to key points that had emerged at the three quarter year stage, which were expanded upon in the report and which centred around:

Service Revenue Outturn

-          The Council was forecasting an £11m overspend against services’ budgets.

-          Around £4m of this could be mitigated by a capital financing under-spend, surplus grants, and capitalisation of VR costs.

-          The Council was seeking to identify further significant remedial actions to address the net £7m budget shortfall.

Reserves 

- Together with the budgeted contribution to balances, and other items including surplus earmarked reserves, it was estimated that the level of general reserves at 31^st March 2012 would be approximately £13.2m, before the impact of any further remedial measures were taken into account. The 2011-14 Reserves Strategy included an original forecast reserves position as at 31^st March 2012 of £15m with a risk assessed minimum level of £14.7m.

Capital Programme

- The forecast variance from budget of £16m in 2011-12 was largely explained by slippage, with costs being re-phased to future years.

Debt

            - Outstanding debt over 6 months old remained at around £2m.

Performance 

-  From the retained former statutory indicators (National Indicators and Best Value Performance Indicators) reported corporately during the first three quarters of the year, 50% of measures were reported as performing below target and agreed tolerances.

Questions

The following responses were given in respect of a number of questions raised by Members:

• The Council cautiously planned for a Council Tax collection rate of 99%. In fact the Council actually collected in excess of 99.5% but always pursued the 100% that was billed. If less than expected was collected, and was a significant figure, the shortfall was collected from the precepting authorities. If there was a significant surplus, it was shared amongst the precepting authorities. The Collection Fund was managed in such a way that the balance was as close to nil as possible.

• Information regarding the current rules with regard to Business Rates or empty business premises would be circulated to Members outside of the meeting

• Actuarial charges of £3.9m referred to in paragraph 33 on page 15 of the  ...  view the full minutes text for item 174