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Agenda item

Q2 Finance Report - Nov 23

Purpose:

To detail the Council’s financial performance for Quarter Two 2023-2024.

 

Recommendation:

That the Committee scrutinises the Financial Performance for Quarter Two 2023-2024

 

Invited:

Councillor Alaric Smith, Executive Member for Finance

Madhu Richards, Director of Finance

Georgina Dyer, Chief Accountant

 

Minutes:

Councillor Alaric Smith, the Executive Member for Finance, introduced the Quarter Two Finance Report, which included a forecast outturn position for the first time.

The Director of Finance introduced herself and explained that she had only been in post for just over three weeks. The forecast allowed the Council to review progress against the budget that was set earlier in the year, and that as a forecast it probably will change. The main areas of overspend were in:

  • Waste;
  • Leisure;
  • Investment Properties.

 

These three areas will be a focus of work during the 2024/25 budget setting process.

The Director of Finance then asked if the Committee had any questions on the report.

Councillors asked about the following points within the report:

 

Point 1.1 recycling cost impact.

Bill Oddy the Assistant Director for Commercial Development confirmed it was a national problem where the cost of processing the recycling had increased, and the public was recycling more. The Council’s contracts and neighbouring districts’ contracts were up for renewal, so the option of jointly procuring contracts would be explored.

WODC had increased waste charges this year by £5, but this had not affected the number of licences, they remained broadly the same. After a benchmarking exercise the Council’s fees were found to be lower than average, and the second lowest across Oxfordshire and Gloucestershire.

Point 1.7 GLL payment and future payments.

Recent meetings with GLL had taken place and a number of positive avenues were being explored

Point 1.9 Appeal external legal fees.

Jon Dearing, the Assistant Director for Resident Services, confirmed that appeal legal fees were significant, and that it was dependant on the planning appeals outcomes. Councillor Alaric Smith informed the Committee that at a recent informal Executive meeting Phil Shaw, the Business Manager for Development & Sustainability had attended, and informed the Executive that they were considering a Development Control briefing, that would explain the impact of appeal fees to the members of the planning committees.

The Director of Finance added that there is a Legal Services review going ahead too, as due to resource issues in Legal Services, external Legal Services that were procured also had added to the costs.

 

Point 1.11 Pensions budget, could this be afforded.

The Chief Accountant confirmed that the report was written in advance of the Publica Review. Therefore once the output of the Publica Review was known, these figures would be reviewed. The report to the end of quarter two reflected the secondary (i.e. historic liability) contributions that were made in regards to the Local Pensions Government Scheme. However, the budget was set before the actual levels of secondary contributions were known. A re-evaluation would occur in January. Any outputs from the Publica Review would be built into the 2024/25 budget but the timescales were tight as the Publica Review and Budget setting would all occur at a similar time.

 

Point 1.14 Council Tax and Business Rates income versus arrears.

The Assistant Director for Resident Services explained that a discretionary Council Tax Support Scheme was in place to assist residents who were struggling financially. The Revenues Team were also meeting with a charity next week that works with residents with checking if they were entitled to any benefits that they may not be claiming.

Councillor Levy added that the Council Tax Support Scheme was more generous than in previous years.

 

Councillors queried Annex B and why there was so little capital expenditure against the budgeted amount..

The Chief Accountant explained that the capital programme showed where provision had been made for schemes but that actual expenditure would be subject to an approved business case. There was nothing in the pipeline for the Investment Recovery Strategy, for which there was £5,000,000 available, due to the impact of high interest rates. Some capital projects had timing issues, some had begun but were not completed as yet. Sometimes there was slippage at year end, which is not unusual.

Councillors noted concern that expected expenditure had not occurred.

The Chief Accountant confirmed that the situation was not ideal, however situations change throughout the year and timings sometimes change. Each capital project would need to be individually approved via Executive during the year, and therefore expenditure budgeted may not be spent as expected if timings slip. Some items that were ordered last year had not been delivered as yet, therefore sometimes it was beyond the control of the Council.

The Executive Member for Finance used the Chipping Norton roof replacement as an example, this had now changed to a repair. A capital budget may not always be spent, depending how circumstances changed during the year, some projects may not end up going ahead.

The Chair noted that the project for the Chipping Norton Leisure Centre roof would be underspent now that the roof was being repaired rather than replaced. However, it was not just the roof that was the issue, the ceiling was in disrepair. Councillor Rizvana Poole added that the flooring, the gym and the health implications for the staff needed looking at.

The Chair Councillor Andrew Beaney proposed to recommend to the Executive that the Council draws up proposals for a full refurbishment of Chipping Norton Leisure Centre utilising the underspent capital allocation for roof replacement to address the issues caused by water damage over a number of years. This was seconded by the Vice-Chair, Councillor Rizvana Poole, put to a vote and was carried.

 

The Committee Resolved to recommend to the Executive:

That the Council draws up proposals for a full refurbishment of Chipping Norton Leisure Centre, utilising the underspent capital allocation for roof replacement, to improve the centre and address the issues caused by water damage over a number of years. This project should include, for example, replacing flooring and carpeting, repainting walls and replacing gym equipment.

Councillors enquired about the contract management line in the table on Page 46.

The Chief Accountant explained that this related to GLL income, the full contract income for the year was budgeted, an income contingency was added as at the point of setting the budget the Council was uncertain as to how much contractual income would be achievable in the year.

Councillors were concerned that if GLL read the reports they would see the contingency and use this information. The Chief Accountant confirmed that budget documents were public documents. The contingency represented prudent financial management.

Councillors queried whether GLL would be asked to fully meet their contractual commitments.

The Chief Accountant confirmed that they were already in negotiations with GLL and as soon as they had something to report they would bring that back to the Committee.

 

Councillor Thomas Ashby enquired about monies to be transferred to Witney Town Council. The Chief Accountant explained that no request for payment had been received as yet.

The Assistant Director for Commercial Development confirmed that monthly meetings took place with Witney Town Council and that he would take an action to officers to ask for this to be progressed.

 

The Chair thanked the Director of Finance and Chief Accountant for their contribution to the Committee.

 

Councillor Mathew Parkinson left the meeting during this item at 18:54.

Supporting documents:

 

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