Policy Committee – 13 November 2012
REVENUE BUDGET MONITORING REPORT QUARTER 2 2012/2013
Report of the Corporate Head of Financial Management
Ward(s) Affected: All
1.
Purpose of Report
1.1. To advise members of the revenue budget position of the Council, based on the half year review of
income and expenditure to the end of September 2012.
2.
Recommendations
2.1. Members to note the revenue budget monitoring position as at 30 September 2012.
3.
Background Information
3.1. On 22 February 2012 the Council approved its Revenue Budget at £6,894k for 2012/13.
3.2. The budget includes:

A compensatory grant of £85k, equivalent to an increase of 2.5%, which is payable for one
year only

Contributions to Earmarked Reserves as follows:
Enabling Efficiencies Fund
£39k
Planning Reserve
£80k
New Homes Bonus Reserve £367k

Overall savings of £316k in the net cost of services

Growth pressures of £219k , of which £51k are ongoing, i.e. will impact on the base budget in
future years

A Corporate Contingency of £70k. (Transfers from / to the Corporate Contingency are made
during the year as service costs / savings are realised.)
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Quarter 2 Financial Performance
4.1
Based on the September budget monitoring exercise, the Council’s performance against budget is
a projected overspend of £7k for the full financial year. This is an overall improvement of £15k on
the Q1 projected outturn. Projected financial performance at the end of Q2 is summarised in Table
1 below.
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TABLE 1 - SUMMARY OF PROJECTED OUTTURN POSITION AS AT 30 SEPTEMBER 2012
Revised Projected
(Under)
OverBudget
Outturn
spend
2012/13
2012/13
2012/13
£
£
£
Chief Executive / Deputy Chief Executive
Resources Department
Community Department
1,886,562
1,798,772
2,155,758
1,838,367
1,922,352
2,194,381
(48,195)
123,580
38,623
Total Service Related Costs
5,841,092
5,955,100
114,008
(20,940)
302,000
320,960
(25,000)
69,620
(58,240)
302,000
320,960
(25,000)
0
(37,300)
0
0
0
(69,620)
6,487,732
6,494,820
7,088
Description
Corporate Costs
Investment Income
Interest Payable
MRP for Capital Financing
Recharges to capital excl from Net costs of Services
Corporate Contingency
Total Revenue Budget 2012/13
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4.2
4.2.1
Service Related Costs
Services are showing a projected adverse variance of £114k. Details of the variances are set out
in Appendices A1 to A3. The main factors giving rise to the variances are:

Chief Executive / Deputy Chief Executive
 Savings in employee costs of £38k across various services.
 Business Support savings in printing & stationery costs of £10k.

Resources Department
 Car Parks are projecting a total adverse variance of £86k. The main reasons for this
are a reduction in anticipated income of £58k and an increase in NNDR costs for the
High Street Car Park of £26k.
 Skipton Market Setts are projecting an adverse variance of £20k. This relates to a
charge payable to Skipton Town Council of £15k, for which no budget was approved.
As well as a projected income shortfall of £5k.
 Democratic Services and Elections are projecting an overspend of £12k, comprising
unrealised Value for Money savings, and additional election costs.
 Belle Vue Square costs are projected to show an adverse variance of £38k at the year
end. Cost pressures relate to the service charge, electricity costs, NNDR, insurance
and trade waste.
 Skipton Town Hall is forecast to deliver additional income of £12k (15% above budget)

Community Department
 Waste Management Services are projecting an overall adverse variance of £44k. This
includes additional net costs in the trade waste operation of £30k. A forecast
overspend on consumable goods of £16k, and a reduction in budgetted income of
£16k.
 Building Control – Fee Earning is projecting a full year shortfall on income of £30k.
 The Planning Service Unit is projecting additional costs of £50k relating to appeals.
The reserve provision of £30k has been released to offset some of these costs.
 The Local Development cost centre is showing projected savings of £20k on Employee
Costs.
 The Homelessness Service is projecting an underspend of £14k on expenditure
following a decision to bring the Housing Advice Service in house (a report to Policy
Committee forecast savings of at least £12k).
 Craven Pool & Fitness Centre is forecast to achieve a bottom line saving of £6.5k at
the year end as a result of income growth.
 The Museum service is projecting savings of £11k from reduced employee costs and
additional sales income.
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 Bereavement Services are projecting additional income of £10k from cremation fees.
4.3
Corporate Costs
4.3.1
At the end of the second quarter Corporate Costs are showing a projected favourable variance of
£107k. This relates to additional investment income of £37k and unused contingency of £70k.
4.3.2
Virements of £32k have been made to / from the Corporate Contingency.
Contingency Fund will reduce the projected underspend.
4.4
Further calls on the
Main Risk Areas
4.4.1 The 2012/13 Revenue Budget report highlighted the main risk areas to the Council as sustaining
income levels in the current economic climate, and implementing the savings that have been built
into the budget.
4.4.2 The Q2 report shows that income streams from Parking and Building Control are projected to fall
short of budget. The projected shortfall in car parking income is £58k (4%) and is made up of
adverse variances on fees and permits. The projected shortfall on building control fees is £30k
(17%).
4.4.3 All income streams are being closely monitored on a monthly basis. A review of fees and
charges will be presented to Policy Committee in January.
4.4.4 Scrutiny of the projected outturn on a cost centre basis was undertaken at the VFM Clinics on
24th and 26th October. Budget holders have been asked to take corrective action where
possible to ensure a balanced budget position at the year end. This will be reflected in the Q3
Budget Monitoring Report. A review of progress against savings targets and the utilisation of
specific growth bids has been undertaken as part of the Q2 budget monitoring cycle. Appendix B
reports progress on the utilisation of growth bids.
4.4.5 Further reports will be presented to Policy Committee based on the end of December and March
information. Budget monitoring clinics are held with budget holders on a quarterly basis.
Statistics showing performance against income and salary budgets are also presented to CLT on
a monthly basis.
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Financial Position
5.4
Following conclusion of the external audit, the Council has a General Fund balance of £1,030k at
31 March 2012.
5.5
The Council’s policy is to increase the General Fund Balance to a prudent level. This is essential
in order to mitigate against the risk of unplanned movements from budgeted net expenditure levels
and to cover for day to day cash flow variances. Moreover, a robust level of reserves will help the
Council mitigate against the risks of ongoing funding cuts, the uncertainty surrounding funding
levels from 2013/14 and the impact of changes to local government funding.
5.6
Table 2 summarises the position of the General Fund Balance for 2011/12.
TABLE 2 - SUMMARY OF GENERAL FUND BALANCE
Opening Balance as at 1 April 2011
Contribution to balances in 2011/12
General Fund Revenue Balance as at 1 April 2012
£k
(598)
(432)
(1,030)
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Summary
6.4
Based on information available at the end of September 2012, a projected overspend of £7k is
forecast for the year.
6.5
The risk of falling income levels from fees and charges is a continuing trend in specific service
areas.
6.6
The General Fund Revenue Balance currently stands at £1,030k. This will assist in mitigating
against the risk of unplanned movements from budgeted net expenditure levels, as well as the
impact of changes in local government funding.
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Implications
7.4
Financial Implications
All financial implications are contained in the body of the report.
7.5
Legal Implications
None relevant.
7.6
Contribution to Corporate Priorities
The delivery of a balanced and managed budget is critical to the well being of the Authority.
7.7
Risk Management
Failure to achieve a balanced budget in the current financial year will have serious consequences
for the Council.
7.8
Equality Impact Assessment
The Council’s Equality Impact Assessment Procedure has not been followed as it is not felt to be
relevant to this report.
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Consultations with Others
CLT, O&S VFM Group
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Author of the Report
Joanna Miller, Corporate Head of Financial Management
Tel: 01756 706302
[email protected]
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Appendices
Appendix A – Analysis of projected outturn by Department / Cost Centre Group.
Appendix B – Progress report on utilisation of growth bids
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