Agenda item

The Commission considered a report of the Director of Corporate Resources which provided an update on the 2013/14 revenue budget and capital programme. The report also set out:-

 

i)       recommendations to be made to the Cabinet on 13^th September regarding the use of projected revenue underspends to fund ‘invest to save initiatives;

ii)     the outcome of a review of the deliverability of the capital programme and a revised capital programme for approval.

 

A copy of the report marked ‘1’ is filed with these minutes.

 

Revenue Budget

 

In introducing the report the Director of Corporate Resources drew attention to Appendix 1 which set out the difference between the projected outturn and original budget. In particular he drew attention to a projected overspend of £3,000,000 in the Adults and Communities Department which was offset by underspends elsewhere the most significant of which were the following:-

 

Centrally Managed Schools Budget                    -£530,000

Children and Young People’s Services              -£580,000

Corporate Resources                                              -£610,000

Contingency for Efficiency Savings                    -£4,460,000

Contingency for Inflation                                       -£1,500,000

Revenue Funding of Capital Spend                    -£2,500,000

Business Rates Additional Income                      -£370,000

 

The effect was a net underspend of £7,700,000. A report was due to be submitted to the next Cabinet meeting which would suggest that part of the underspend be utilised for the following purposes:-

 

·         A potential contribution to the City of Culture if the bid was successful;

·         A £60,000 contribution to the Bradgate trust to enable the purchase of some land adjacent to Swithland Wood;

·         Funding for two highway projects namely bridge strengthening at Zouch and for further development of the Leicester and Leicestershire Integrated Transport Model (LLITM);

·         Utilisation of outstanding underspends towards either the repayment of pension liabilities or to repay debt. 

 

With regard to the proposed suggestions for utilising the underspends a number of members were of the view that this should be considered in the context of the responses to the consultation on the MTFS and the significant budgetary pressures faced in Adult Social Care. In this regard the following points were made:-

 

·         Whilst recognising that the City of Culture bid would bring benefits to County the Cabinet needed to demonstrate the economic  benefits to the County of any such investment;

 

·         Some concern was expressed about further investment in the LLITM and members were of the view that a clear business case needed to be made before additional resources were made available.

 

On the issue of localisation of council tax collection, the Commission welcomed the additional investment of £50,000 to engage an external company to undertake checks on single person discounts. Whilst noting that risks to the collection fund balances were being monitored there remained some concern regarding future years when existing government support for the scheme was phased out.

 

The consultation currently underway regarding the New Homes Bonus was a concern as it could have a significant adverse effect on the County Council particularly if the Government were to opt for a 100% top slice from County Council.

 

The Commission was reassured that the underspends in the Early Years and Childcare, Short breaks for disabled children were as a result of lower demand and not a reduction in service. Similarly, the demand for Community Care and Crises Loans had been lower than anticipated and the £200,000 contingency that had been set aside would not be required.

 

The overspend in Adults Social Care was primarily as a result of significantly lower than expected savings being achieved in the ‘Effective Support Efficiency Programme’. That programme had anticipated savings in the order of £6,500,000 resulting from a reassessment of client needs and investment in less expensive preventative services. To date savings of £1,500,000 had been achieved and it was now expected that the full year effect would be of the order of £2,500,000. Part of the overspend had been offset by utilising health transfer monies and the Department was looking at greater use of Assistive Technology to reduce spending pressures. It was acknowledged that the social care budget faced significant challenges and posed a risk particularly with likely changes as a result of the Dilnot proposals and the new Care Bill. It was noted that this was a national issue and that unless action was taken on improving joint working with the Health Service and greater integration there was a significant risk to the current social care arrangements and other parts of the Council’s budget. The Government had made some funding available and to date there had been good engagement with local health service partners.

 

Capital Programme

 

The Commission was advised that following a review of the current programme and its deliverability a revised capital programme was being put forward for approval to the Cabinet.

 

In response to questions the Commission was advised as follows:-

 

·         the lower than expected level of funding from the Education Funding Agency affected a number of Authorities. It would appear that funding had been diverted to areas of the Country where there were particular pressures on primary school places. Whilst this was less of a problem in Leicestershire there were nevertheless some pressures in the Hinckley and Blaby areas. The Commission noted that the Children and Families Scrutiny Committee would be looking at the issue of school place planning at its next meeting;

·         the County Council had a good track record of opportunity purchases of agricultural land which not only generated a revenue stream but had contributed significantly to the generation a capital receipts.

 

Members noted that the proposed development of a 25 place school for children with autism had proved financially unviable and were concerned about the impact that this may have on pupils and their families and also on the revenue budget if this were to result in increased number of out-county placements.

 

RESOLVED:

 

(a)     That update on the 2013/14 revenue budget and recommendations to be made regarding the use of projected revenue underspends to fund ‘invest to save’ initiatives, be noted and the views of the Commission be drawn to the attention of the Cabinet;

(b)     That the recommended revised Capital Programme, be noted;

(c)      That the Adults and Communities Scrutiny Committee be asked to look in detail at the reasons for the overspend in the budget and the risks posed for future years given the additional pressures that are likely to be faced by the Department from changes resulting from the Dilnot report and the Care Bill.