Agenda item
Finance Monitoring Quarter 1 Report
Minutes:
The Executive Director for Finance and Corporate Resources presented the Finance Monitoring Report for the period 1st April – 30th June 2014. The following points were raised during presentation of the report:
· Officers were anticipating that there would be an underspend of £124,000 by the end of 2014/15.
· Estimates for both revenue and capital expenditure were provided to the Finance teams by Heads of Service.
· There had been a decline in revenue from Civil Parking Enforcement as there appeared to be decreasing use of car parking facilities in Bromsgrove town centre.
· There was a projected overspend on refuse and recycling due to major vehicle repairs. The Head of Environmental Services had been asked to determine whether more savings could be achieved in the long-term if the fleets were to be replaced.
· Additional staff had been recruited to work in the Planning Department. Some of the posts were supported by funding that had been obtained from a portion of Council reserves, valued at approximately £180,000 – £200,000, which had been allocated a few years previously to Planning Transformation and shared services costs.
· This reserve had also been used to fund other areas, including additional staff in the Benefits Service and redundancy costs.
Members discussed residents’ preferences when parking in Bromsgrove district. It was noted that residents appeared to prefer to park in car parks where a pay on foot arrangement was in place. This arrangement had not been introduced at every car park in the district, though the Cabinet had agreed the Recreation Road South Car Park Task Group’s recommendation for more pay on foot charging arrangements to be made available in local car parks in the future. Further analysis was needed of parking charges to enable Officers to assess whether certain parking arrangements were appealing more to residents than others. It was suggested that more information could be recorded in future financial monitoring reports. To ensure that car parking arrangements remained fit for purpose Members agreed that the contents of the Task Group’s final report should be revisited as part of a Short Sharp Inquiry exercise.
The Board discussed the style in which the report was presented for Members’ consideration. It was noted that the way in which net figures were presented in the report could be confusing for people who were not trained accountants. In order to clarify the content of the reports it was suggested that a similar practice could be adopted to other public sector organisations, including the NHS, which presented both income and expenditure figures in these types of reports. Furthermore, Members suggested that the data provided in the reports would be more meaningful if comparative figures were also provided for the same quarter in previous years.
The report monitored service budgets in relation to predicted expenditure. These predictions were provided by Heads of Services in their profiles for their services for the year ahead. However, their predictions were not always accurate and in some cases significant underspends could arise. A consequence of these inaccurate predictions could include the Council not allocating funding to services or activities that might otherwise have been delivered during the year. There was a risk that there could be consistent underspends for some services within the remit of the same Head of Service year on year. Members agreed that where applicable Heads of Service in future should be invited to attend future meetings of the Board to investigate any reasons for and patterns in underspending on budgets.
The impact of an underspend on the future budget allocated to a service was also discussed. Officers advised that in previous years an underspend would not necessarily result in a reduction in the budget allocated to that service in the following year. However, Finance Officers were in the process of undertaking a line by line review of each budget and it was possible that in future this could lead to a reduction in the budget allocated to a service where underspends had previously been reported.
Members noted that they were considering the report after both Cabinet and Council had already discussed the matter in detail. It was suggested that by that stage the potential for the Board to make a constructive contribution by scrutinising the report was limited. To ensure that Overview and Scrutiny could make a useful contribution to management of the Council’s budget in future Members concurred that financial monitoring reports should be presented for the Board’s consideration prior to Cabinet.
RECOMMENDED that
1. income and expenditure figures should be provided in future Financial Monitoring Reports to provide greater clarity about the Council’s budget position in each quarter; and
2. comparative budget data should be provided in the Financial Monitoring Reports for previous years.
RESOLVED that
1. the Overview and Scrutiny board receive Finance Monitoring Reports in advance e of the Cabinet in future;
2. Heads of Service with services that have consistently reported an underspend over consecutive years should be invited to attend future meetings of the Overview and Scrutiny Board;
3. a Short Sharp Review of car parking arrangements in the district, made up of Members of and taking into account the findings of the Recreation Road South Car Park Task Group; and
4. that the report be noted.
Supporting documents:
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