Agenda item

Revenue and Capital Monitoring

Report of the Director of Finance.


The Sub-Committee received a report of the Director of Finance on the revenue and capital monitoring for quarter 2 as at 30 September 2015, which was due to be considered by Cabinet on 10 December 2015.


Following a brief overview of the report by the Director of Finance, Members asked the following questions and received responses from the officer:


Q –      Why was the RAG (red, amber, green) tracker key used in the report different to that used elsewhere in the Council? Could consideration be given to the inclusion of low red, high red and direction of travel to enable more detailed consideration?


A –      The blue rating indicated that the saving had been achieved and banked and therefore further review was not required.  It was noted that direction of travel was discussed in relation to  performance analysis and was not used in quarterly budget monitoring.  The information provided by Finance was in the form of a commentary rather than ‘ups and downs’.


Q –      Why was it necessary to draw from contingency monies, why were there so many contingency funds and how did separate funds help in managing finances?


A –      Contingency funds were created for specific reasons because the use of one general fund could not identify that expenditure complied with the intended use.   Any combination of such funds would defeat this purpose.  The provision of greater detail on the contingency funds aimed to prevent complications at the year end.  The system improved accountability for Corporate Directors.


Q –      As two months had elapsed since the production of the second quarter information, could updates be circulated at the meeting in order to update the information?  Could consideration be given to the circulation of the monthly monitoring reports considered by CSB and viewed by Portfolio Holders, therefore ensuring that the Sub-Committee received up to date information to enable timely scrutiny of problem areas?  The November report would be relevant for this meeting.


A –      The quarterly monitoring process monitored various budgets at various frequencies based on risk.  It was a forecast for the year and had been smoother than previous years.  The comments raised would be discussed.


Q –      What percentage determined whether a saving would be unachievable and therefore flagged as red?  For example, garden waste remained amber despite a reduction of £850,000 in the saving envisaged.


A –      The garden waste saving could have remained amber because mitigating action had been identified.  Delays on the achievement of savings had resulted in one-off in year mitigation.


Q –      What was the timeframe for no draw down until monies were returned to the general fund?


A –      Depending on the type of expenditure, some contingency funds remained until year end at which point it was decided whether transfer to the general contingency fund was appropriate.  Contingency funds could not be transferred to the following financial year.  An annual review was undertaken as to whether a contingency fund was required for the following financial year.  The creation of a number of contingency funds enabled more efficient tracking and aided transparency on their use at year end.


Q –      With regard to CHW03 and BSS01, the report indicated that the review of Business Support Services was not on target but did not indicate the shortfall.  What was the effect on the Adults Transformation budget?


A –      The tracker would be updated for the next monitoring report.  Paragraph 68 to the report referred to staff savings not being on track and stated that the central scanning project had been delayed pending IT supplier support.  Officers continued to explore the reduction of the projected overspend in the Business Support service for transformation.


Q –      Would delays to savings and IT failures relating to the Capita contract be fed back as part of the negotiations at the closing of accounts?  The savings for the PRISM project amounted to less than 7% of the intended saving.


A –      The departments concerned were required to identify alternative savings.  The Chair suggested that the Scrutiny Leads consider the effect of unachieved savings on the Transformation Programme Plan programme and determine whether a scrutiny review would be helpful.


Q –      What was the worse case scenario for the School Expansion Programme budget?


A –      The worse case scenario was just over £4million and the best case just over £2.5 million, the latter could be covered by the contingency fund.  Discussions were taking place with Keepmoat regarding liabilities.


Q –      What was the impact on services to residents of the forecast Housing Revenue Account underspend of £11.233m as the cost element was not captured?


A –      An examination of the key areas for quarter 3 would provide further information.


Q –      Why did paragraph 91 of the report state that the capital programme forecast at quarter 2 was 76% of the total capital whilst paragraph 169 stated that the current projection was 92%?


A –      The officer undertook to confirm whether the variation was due to slippage.


The Chair thanked the Director of Finance for her presentation.


RESOLVED:  That the report be noted.

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