Agenda item

Colleen Warren, Financial Services Manager, presented Performance Scrutiny Committee the second quarter’s performance (up to 30^th September) on the Council’s:

·         General Fund    

·         Housing Revenue Account

·         Housing Repairs Service

·         Capital Programmes

Highlighted that the General Fund Summary was currently projecting a forecast over spend of £86,698 (Appendix A provided a forecast General Fund Summary). The forecast variance was the result of a number of forecast year-end variations in income and expenditure against the approved budget. Full details of the main variances were provided in Appendix B while the key variances were summarised below:

·         Housing Benefit Overpayment – reduced income: £368,000

·         HIMO – reduced income: £74,260

·         Interest Payable – reduced expenditure: (£200,000)

·         Crematorium additional income: (£125,990)

·         Car Parking Income: (£119,000).

Explained that the most significant of the forecast variances was the reduction in the level of housing benefit overpayment being raised. Whilst this was positive in that the number of overpayments were reducing it in turn created a budgetary pressure. This was a continuation of a trend from 2017/18 and 2018/19 with the transition of benefits customers to Universal Credit and the use of ‘real time’ information, resulting in  the level of overpayments raised being drastically reduced. This reduction in overpayments raised was uncontrollable and would require a budget realignment as part of the 2020-25 MTFS process. In order to inform this a specific piece of work to assess the implications, encompassing the impact of the reduction in overpayments along with the transition to Universal Credit and its impact on historic overpayment debt was being undertaken to inform the MTFS process.

Continued to explain that although the forecast outturn for the General Fund was a shortfall of £86,698, at this stage in the financial year, forecast outturns were difficult to predict and often subject to volatility, e.g. car parking income, and change, the forecast position would continue to be monitored and an update reported at quarter 3.

Highlighted that for 2019/20 the Council’s Housing Revenue Account (HRA) net revenue budget was set at £52,040, resulting in an estimated level of general balances at the year-end of £1,075,141.

Explained that the last quarterly report approved a General Fund Investment Programme for 2019/20 of £14,977,453. Movements in the programme during the second quarter had decreased overall planned expenditure in 2019/20 to £14,755,906.

Explained that the last quarterly report approved a Housing Investment Programme for 19/20 of £19,123,929. Movements in the programme since had increased overall planned expenditure in 2019/20 to £20,629,324.

Highlighted that The Chief Finance Officer had delegated authority to approve financial changes up to an approved limit as set out under Financial Procedure Rules. All changes over the approved limit require approval by the Executive. Changes were approved by the Chief Finance Officer for the second quarter were shown in Appendix K and Ki summarised below:

·         Within the new build programme 15 Property Acquisitions had been agreed under delegated authority utilising 1-4-1 receipts and borrowing totalling £1,849,046.

·         The new build programme for 19/20 had been increased by £1,440,395 in order to finance the 70% match funding required to deliver 1-4-1 eligible spend, funded by borrowing.

Invited members’ comments and questions.

Question: Members asked whether the £10,000 for Michaelgate Structure works was for the Harlequin Building?

Response: Officers were to confirm this.

Question: Members asked what had been done at Birchwood Leisure Centre as there was scaffolding up on the roof?

Response: The roof at Birchwood Leisure Centre had suffered damage due to there being a lot of rainfall and the roof being flat. The Crematorium roof also had the same issue. The roof at Birchwood Leisure Centre was to be replaced with another flat roof and would last 20-25 years.

Question: Members asked how far along the lottery funding for the Boultham Park Lake Restoration was?

Response: A bid had been put in to the National Lottery Heritage Fund and it was a very competitive bidding process. A bid was also in with the ERDF for £300k and a decision was pending the outcome of the lottery bid. Works on the scheme would commence in January/February next year if successful.

Question: Members asked for clarification on the reference within the report to Hartsholme Drainage?

Response: Officers were to find this out and feedback to Performance Scrutiny Committee.

Question: Members asked whether an overview of the fire prevention for our properties could be brought to the next Housing Portfolio Under Scrutiny?

Response: Officers were to feed this back to the Housing Directorate.

Comment: Members commented how money received from collecting Housing Benefit Overpayment was used to being received and now it had to be funded from elsewhere in the future.

Response: Housing Benefit Overpayments were trying to be collected. Less overpayments were being created so less additional subsidy was generated from these. This had now created a budget pressure going forward and effected the general fund. Less overpayments being created was good for customers but it meant a reduction financially.

Question: Members asked whether the Council received 30% of the sale of a former council house and whether this could be used to buy houses?

Response: Council houses were bought back and classed as new builds. Unfortunately this did increase the amount of void properties.

RESOLVED that:

1.    Progress on the financial performance for the period 1^st April to 30^th September 2019 and the projected outturns for 2019/20 be noted.

2.    The changes to the General Investment Programme and Housing Investment Programme as detailed in paragraphs 7.4, 7.5, 7.11 and 7.12 be noted.

3.    The proposed contributions to and from reserves in paragraphs 3.5 be noted.

4.    Officers be requested to confirm to members of Performance Scrutiny Committee whether the £10,000 for Michaelgate related to the Harlequin Building.

5.    Officers be requested to confirm to members of Performance Scrutiny Committee clarification regarding the reference to Hartsholme Drainage works.