Agenda item
Budget monitoring report 2022-23 Outturn (inc Capital)
Minutes:
The Committee considered a report that presents the provisional outturn compared to the budget report 2022-23 as at 31st of March 2023 for the General Fund, Dedicated Schools Grant (DSG) Budget, Housing Revenue Account (HRA), progress made against savings targets and the council’s capital programme. It also provided projections on General Fund earmarked reserves and the forecast impacts of Covid on the Councils finances in 2022-23. A summary of the discussions is set out below:
The Board:
v Noted that in terms of allocating funds and resources to different directorates, the Council goes through various processes to identify where growth needs to be increased and to align things with the strategic plan at the end of the day,.
v Noted that the Council needs to make sure it is working towards what has been have budgeted and what can be delivered. This an integral part of resource management that ensures services run as smoothly and efficiently as possible.
v Agreed that effectively allocating resources can help service areas accurately choose, delegate, and manage the components of their projects and avoid over or under-utilising staff or materials i.e., it provides a benchmark to work towards. It provides a comprehensive idea of exactly what, and how many, resources they require to complete a given project or task to avoid overspending or underestimating needs. Allocation provides the visibility necessary to ensure resources are always available and keep projects on track in terms of overall spend.
v Noted that the Council cannot finalise its budget until it knows: (i) how much it needs to spend on maintaining its services to an acceptable level; (ii) the additional spending pressures it has for service developments, price increases and pay awards; (iii) the level of savings it can achieve; and (iv) how much it will receive from central government.
v Noted that the Housing Revenue Account has a provisional outturn position with an adverse variance of £6.6m when compared with budget. This represents an adverse movement of £1.4m when compared with the Q3 forecast position.
v Noted that whilst a drawdown from reserves of £6.6m will be made to mitigate the budget pressure. There are a number of favourable and diverse variances that make up the final outturn position e.g., there was a favourable variance of a technical budget of £3.5m against depreciation and interest received interest payable which reduced the actual overspend. However, there are still a number of areas that need to be looked at e.g. The HRA has incurred an unbudgeted energy cost pressure totalling £2.2m for gas and electricity. These costs are partly recoverable from leaseholders where they relate to communal areas.
v Noted that the Council and Tower Hamlets Homes (THH) will be looking at the impacts of adverse variances on the budgets for this year and going forward to make sure that the HRA stays in balance because it has a hefty program to support for the new build projects.
v Noted that the Council and THH will also need to make sure there is sufficient resources available for the current stock and the new inspection regime that is coming online.
In conclusion, the Chair thanks those who had presented the report and those councillors in attendance for their contributions to what had been a constructive discussion on this critical issue.