Agenda item

The Deputy Chief Executive presented the Finance and Performance Quarter 3 Monitoring Report for the 2023/24 financial year.

Members were advised that the report included:

·             The Council’s forecast outturn revenue and capital monitoring positions for 2023/24 based on data to the end of Quarter 3.

·             The updated Worcestershire Regulatory Services (WRS) fees and charges.

·             The half yearly Treasury Management Report.

·             Procurement pipeline projects.

·             The organisation’s performance against the Council’s strategic priorities outlined in the Council Plan Addendum, including operational measures to demonstrate how the Council was delivering services to customers.

In respect of revenue spending, overall, by the end of Quarter 3, the Council was forecasting a revenue overspend for 2023/24 in the region of £950,000.  However, this figure had been calculated before the application of £557,000 from the Utilities Reserve, as approved at Quarter 1. The forecast overspend was predominantly due to:

·             The implications of the 2023/24 pay award, which was paid in the December payroll and backdated to 1^st April 2023.

·             Temporary and interim staff requirements and their associated cost pressures.

·             The impact of homelessness and the cost of temporary accommodation costs. A review of grants available to offset the cost pressures was taking place by the date of the meeting.

·             Higher than expected ICT costs in Business Transformation and Organisational Development.

·             A higher than expected share of service costs in from Bromsgrove District Council in Environmental Services.

However, this overspend was offset in part by:

·             A forecast underspend against the utilities budget provision due to utilities inflation running at 70 per cent. In the 2023/24 budget, the Council had assumed a 100 per cent increase in this budget would be needed and had therefore set up a reserve for the same amount.

·             Higher than expected grant income in Community and Housing Services.

·             Higher than expected fees and charges in Planning and Leisure Services.

The Capital spend at Quarter 3 was £2.586 million (compared to £1.267 million at Quarter 2) against the overall 2023/24 capital budget totalling £12.651 million. Members were asked to note that, as per the Medium Term Financial Plan, carry forwards of £3.292 million would be added to this figure to take account of slippage from 2022/23.  The capital section set out progress on the Town’s Fund Schemes and also the Community Hub initiative at the Town Hall.

The report detailed proposedupdates to the WRS 2024/25 fees and charges.  These were originally agreed in Tranche 1 of the 2024/25 budget, but updates were needed in areas where fees were statutorily set. 

The Council detailed its Treasury Management Strategy and associated indicators as part of the Medium Term Financial Planning process.  The 2023/24 Strategy and Indicators were agreed at Council in February 2023. There was a requirement for a report to be produced for the consideration of Council to show performance against these strategic indicators at the half yearly position and then at the year end.  The report provided the half yearly performance update.  Members were asked to note that by the date of the meeting, the Council was meeting its prudential indicators and returning 4.7 per cent on its short-term investments.

Information about forthcoming contracts in the procurement pipeline, for both Capital and Revenue expenditure, valued at over £200,000 and which had been delegated for approval to the Executive Committee or Officers over the next year, had been highlighted in exempt appendices.  It was proposed that new items should be added to the Executive Committee’s work programme plan.  There were 16 contracts listed.

A list of all procurement valued between £50,000 and £200,000 had also been included in the Procurement Pipeline.  The Executive Committee could request further detail and these proposed areas of expenditure could be subject to additional scrutiny where Members considered this to be appropriate.  There were 11 contracts listed here.

As the Council maintained many shared services, a number of procurements that impacted on Redditch would be procured through Bromsgrove District Council.  Information about this would continue to be reported for Members’ consideration.

The Housing Revenue Account (HRA) for the period April – December 2023 was also considered.  The major variances in the HRA were:

·             Repairs and Maintenance – Officers reported a favourable variance due to posts being left vacant pending restructures of some parts of the service. However, this was offset by the costs of temporary staff.

·             Supervision and Management – The variance was mainly due to vacancies.  Posts had been left vacant due to the ongoing review of the Housing Services function.

·             Provision for Bad Debts - Increases in insurance premiums and disrepair claims by tenants had increased.   

Based on the data gathered, by the end of Quarter 3, Officers were forecasting a £105,000 underspend in the HRA on the £11.725 million programme.

Consideration was given to the Strategic Priorities and Performance Measures data provided in the report.  For the Council’s nine priorities, data had been provided in relation to the performance measures being used, an update on how that data was being used and, where relevant, contextual information.

Key performance information highlighted for Members’ consideration included:

·             Noting the vacancy rates on commercial units.

·             Housing growth of 108 units (39 affordable) and Homelessness approaches. This included increases in the local housing affordability rate to 8.68.

·             The reasons why people were asking for financial assistance advice.

·             Updated data on Rubicon Leisure Limited.

·             That 412 households had been given Energy Advice in Quarter 3.

·             Staff turnover rates being significantly lower at 8.8 per cent compared to a national vacancy rate of 15.8 per cent.

·             The significant increases in fly-tipping.

·             The 100 per cent Third Party Gas Audit Compliance rate, which compared to a target of 85 per cent compliance, as at Quarter 3.

·             Repairs to standard void units still being delivered in under 20 days.

·             The updated Council Priorities.

Following the presentation of the report, reference was made to the close working that had occurred between the Housing, Procurement and Finance teams and the impact that this had had on services.  Clarification was provided that it was important to ensure that contracts were included on the Council’s contracts register to ensure that there was compliance.  A key factor leading to recent improvements had been the fact that Officers were starting to plan procurement processes further in advance than had been the case in previous years, leading to greater efficiency and transparency.

RESOLVED that

1)          the current overspend position in relation to Revenue and Capital Budgets for the period April to December and the full year overspend position of £383,000 after applying £557,000 from the Utilities Reserve, as approved at Quarter 1, be noted;

2)          the Housing Revenue Account (HRA) position be noted;

3)          the updated procurements position be noted, and those items over £200,000 should be included on the forward plan;

4)          the Quarter 3 Performance data for the Period April to December 2023 be noted;

RECOMMENDED that

5)          the updated Worcestershire Regulatory Services (WRS) 2023/4 fees and charges be approved; and

6)          the half-yearly Treasury Management position be noted.