CALDERDALE MBC
WARDS AFFECTED: ALL
REGENERATION AND DEVELOPMENT SCRUTINY PANEL
5th September 2007
REVENUE BUDGET MONITORING 2007/08 and Future Years
Report of Group Director Regeneration and Development
1.
Issue
To report:
-the first overall revenue budget monitoring position for 2007/08;
-the forecast Service Controlled budget variances of the Directorate
2.
Need for a Decision
This report is primarily for information. No decisions are required.
3.
Recommendations
It is recommended that this report be noted.
4.
Overview of Report
This report represents the results of the first overall review of net revenue
expenditure compared to budget in 2007/2008.
5.
Background and Details
5.1
The Directorate total revenue budget for 2007/2008 is currently £16.835m.
Some of this relates to centrally controlled items including for example capital
charges and recharge of budgets managed by other services. This report
covers the direct service controlled budget totaling £13.184m
5.2
This first review for 2007/2008 compared to the current approved budget is
summarised below:
Current
Approved
Budget
Forecast
for Year
Variance
(f-e)
£000
£000
£000
£000
(d)
(e)
(f)
11477
13184
13663
(g)
479
overspend
Net Expenditure to Remaining
June
Budget
(a)
Overall
Directorate
Position
%
of
£000
Budget
(b)
(c)
13
1707
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5.3
The Summary shows the net expenditure on the Councils financial ledger at
the end of June. However the forecast for the year is based on the position on
the financial ledger at that time, together with known/planned commitments
and expected income.
5.4
The forecast identifies risks and budget pressures. Action is to be taken by
the Directorate Management Team to ensure an overall balanced budget in
accordance with the Councils Constitution and budget framework.
6.
Financial Summary.
6.1
The total Directorate service controlled revenue budget is allocated out to a
number of Business Planning Units and Support Services.
6.2
Each Business Planning Unit comprises a number of Cost Centres. Each
Cost Centre has a dedicated budget for expenditure and income and a cost
centre manager responsible for monitoring and managing the budget in
accordance with service requirements and for providing a forecast outturn for
the year.
6.3
Support Services represent the cost of
-
Business Support Service (in house Personnel, Payroll, Finance and ICT
functions),
the Director and PA
the GIS/Gazetteer service.
Each of the above has a cost centre manager with the same responsibilities
as for the Business Planning Units. The costs of Support Services are
allocated out to the Business Planning Units and other services at the
financial year-end.
6.4
Cost centre managers and Heads of Service receive monthly statements
showing the budget, income and expenditure, commitments and remaining
budget and are required to review/update the forecast for the year each
month. This process enables Managers to rapidly identify relevant budget
control issues and to reallocate budgets to offset forecast
under/overspendings.
6.5
Many items of income and expenditure do not follow a straight-line pattern or
even spend/receipt during the year. For example some grants, particularly in
the Planning and Regeneration service, may only be received at year end,
winter service costs are mainly incurred during the winter season, property
rates are normally charged at the beginning of the year, rent income may be
charged quarterly in advance or arrears, etc.
6.6
The forecast compared to current approved budget for each Business
Planning Unit and Support Services is shown in the following table, which
includes a subjective analysis:
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Current
Approved
Budget
Forecast
for Year
Variance
(f-e)
£000
£000
£000
£000
(d)
(e)
(f)
(g)
Business Planning Net Expenditure to Remaining
Units
June
Budget
(a)
Building
Consultancy
Highways,
Car
Parking
and
Footpaths
Markets
Planning Policy and
Development
Control
Regeneration
Support Services
Total
Subjective
Analysis
Expenditure:
Employees
Other Costs
Internal Recharges
Income:
Grants
Other
Total
%
of
£000
Budget
(b)
(c)
29
747
1855
2602
2602
0
7
523
6819
7342
7542
200
13
-73
-510
-583
-583
0
15
147
824
971
1150
179
3
24
13
48
315
1707
1482
1007
11477
1530
1322
13184
1630
1322
13663
100
0
479
25
12
5
3140
2167
-287
9483
16296
-5745
12623
18463
-6032
12783
18681
-5918
160
218
114
43
23
13
-1237
-2076
1707
-1643
-6914
11477
-2880
-8990
13184
-2874
-9009
13663
6
-19
479
6.7
The percentages shown of net expenditure to June are based on the current
approved budget. This shows that the Directorate has spent, net of income
received at end of June, 13% of its current approved budget. If the budget
was spent evenly throughout the year in a straight line, the expected net
spend would have been 25% and this is similar to the profile of actual spend
shown for Employees.
6.8
The current year forecast is to overspend the budget by £479k. There are
three key components to the forecast overspend
ISCAL- the service budget deficit in 2006/07 was £110k and a deficit of £100k
is expected for 2007/08. An in depth review and development of possible
options for this service are planned to be reported to Cabinet in October.

Local Development Framework-there has been a significant increase in the
forecast level of costs needed to comply with the requirements to develop the
Framework. The service forecast is to exceed budget by £179k in the current
year. A detailed report on the requirements and the latest forecast of costs for
the current and future years will be submitted to Cabinet in due course.
Parking Services-following expansion of the service to implement
Decriminalisation of Parking Enforcement, and other recent changes to on
and off street for Pay and Display regimes, forecasts based on first quarter

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trends suggest that the service will overspend its budget by £200k. It should
be borne in mind however that full year forecasts based on such relatively
short-term information are inherently unreliable and must be treated with a
degree of caution. A final outturn shortfall of anything between £100k and
£300k could therefore reasonably be expected, depending on trends
throughout the remainder of the year. A detailed report on the current forecast
overspend will be submitted to Cabinet in due course. In addition, a strategic
review of Parking Strategy, including financial implications, is planned and a
report will be submitted to Cabinet in due course.
6.9
In addition to these budget problems, there are a number of other potential
budget pressures within the Directorate that have been identified by
managers forecasts including the Piece Hall Market, the level of fee income
and other costs.
6.10
The Directorate Management Team continues to monitor the servicecontrolled budget on a monthly basis and is actively seeking to control
costs/generate income to offset these pressures.
7.
Future Years
7.1
In addition to taking action to maintain current year spend within budget, the
Directorate reviews and monitors the future years budgets in line with the
Councils Medium Term Financial Framework and agreed longer- term
savings and growth.
7.2
This report and forecast therefore considers both the impact of current year
trends and progress on agreed longer-term developments. This does not
include assessments of new requirements or growth, which will be covered
separately with the normal Council budget setting process.
7.3
Action is being taken within the Directorate to implement the agreed budget
savings and growth decisions for 2007/08 and later years and at this stage
there is no expectation of any slippage or shortfall in the achievement of
these initiatives.
7.4
The reports for the three service forecast overspends for 2007/08 outlined in
paragraph 6.8 above will identify any ongoing forecast overspends expected
for future years
7.5
However, within the Regeneration Service, there is some dependency on
grant income to fund services. The current grant regimes will be coming to an
end in 2008/09 and 2009/10 and the Directorate is to develop exit
strategies/identify replacement grant sources. Progress on this issue will be
included in the second monitoring report to Panel scheduled for November.
8.
Corporate and Financial Implications
Under the Councils financial regulations there is a clear responsibility placed
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on Heads of Service to take action to ensure that the net cost of services
remain within the allocated approved service-controlled budget.
Reference:
BSS/AK
Date:
14/8/07
I Thompson
Group Director
Regeneration
Development
&
For further information regarding this report please contact:
A Kent
Telephone: 01422 392108
Documents used in the preparation of this report:
Reports of the Financial Services Manager to Directorate Management Team
13/7/07 and 24/7/07.
Analysis and information provided by the Chief Finance Officer and Heads of
Service
Documents can be inspected at:
Business Support Services, Regeneration and Development, Northgate House,
Northgate, Halifax
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