Agenda item

Consider report by Acting Chief Financial Officer. (Copy attached.)

3.1       There had been circulated copies of a report by the Acting Chief Financial Officer which provided budgetary control statements for the Council’s General Fund based on actual expenditure and income to 31 December 2022 along with explanations of the major variances identified between projected outturn expenditure/ income and the approved budget.  The report explained that the Council continued to be impacted by the current operating environment.  Those impacts included continuing effects of the Covid-19 recovery period and unprecedented inflation levels in the wider economy, which had caused internal Council pressures and pressures on critical service delivery partners.  Due to the very challenging operating environment it remained essential that the Council continued to operate as efficiently as possible to ensure that any financial implications not yet clear could be managed as the financial year progressed.  Forecasts had been completed at the third quarter of 2022/23, as at 31 December, which projected the Council to be in a balanced position at the financial year rend.  That forecasted position included the deployment of £1.528m of the Recovery Fund in order to balance the 2022/23 budget, which resulted in a balance of £1.844m which remained to address future pressures. 

3.2       The Recovery Fund would be drawn down as required to meet identified financial pressures.  Confirmed funding was in place for 2022/23 and was categorised as follows: funding provided by Scottish Government, £0.156m; funding carried forward from 2021/22 through Covid-19 reserve, £9.465m; funding included in the 2022/23 Financial Plan for Covid-19 response, £0.069m; and Assumed Local Mobilisation Plan (LMP) funding, £1.987m. Recovery funding was split between funding which had been ring-fenced to be used for a specific purpose (£3.595m), for example education recovery, LMP  and admin funding, and that which could be used more generally by the Council to address Covid-19 pressures (£8.082m).  All residual Covid-19 funding carried forward from 2021/22 and full details of funding available was shown in Appendix 2 to the report.  Financial plan savings of £12.027m were required to be delivered in 2022/23.  An analysis of deliverability was shown in Appendix 3 to the report.  Following the December month end £8.276m savings had been delivered permanently, £0.504m were profiled to be delivered by 31 March 2023 and £3.247m had been delivered on a temporary basis through alternative savings.  The Acting Chief Financial Officer, Ms Suzanne Douglas, presented the report and responded to Members questions.  Regarding increased spending on Children’s Panel; Appeal and Reporters expenses; Local Election costs; and Councillor travel, Ms Douglas confirmed that those items had been budgeted for but had incurred more costs than had initially been expected.  It was highlighted that Elected Members could use Council e-vehicles to attend community council meetings to cut travel costs.   In response to a question regarding £700k of pressures related to sickness and maternity pay within Education and Lifelong Learning, Ms Douglas confirmed that there was a budget set aside, however the pressures related to spend above what had been anticipated in the budget.  The effects of Covid-19 and other long-term sickness continued to impact upon staff, however the issue was being monitored closely.   Regarding the increased spend of £39k on pay awards and increased client specific care package within Joint Learning Disability, Ms Douglas confirmed that the figures represented the overall net position.  In response to a question regarding further increases to the budget for Learning Disability services, and whether savings were still planned for the service, Ms Douglas explained that management were still focused on delivering savings where possible, and highlighted that changes to care package provision had delivered £40k of savings on a permanent basis, with £160k delivered on a temporary basis.  The Chief Executive explained that considerable resources were required within the Children’s and Young People Service for specialist care packages.  Members highlighted that the packages could often be highly complex, and that the Council had a duty to provide them.   In relation to undeliverable savings being offset by unallocated additional government funding on a temporary basis, Ms Douglas explained that this related to funding which was provided to Scottish Borders Council (SBC) as part of the settlement from Scottish Government which was required to be spent on services delegated to the Integrated Joint Board by SBC.  The additional funding allocated recognised that there was a saving to be made by Strategic Commissioning and Partnerships which would not be possible in 2022/23, and that the in house spend by SBC on what was delegated to the IJB would be higher than expected.  Members unanimously agreed to approve the recommendations.  

            DECISION

            AGREED to:-

(a)        note the projected corporate monitoring position reported at 31 December 2022, the remaining pressures identified, the underlying cost drivers of that position and the identified areas of financial risk as reflected in Appendix 1 to the report;

(b)       note the pressures of £1.528m as detailed in Appendix 1 to the report being funded from the Recovery Fund in 2022/23 in order to balance the budget;

(c)        note the Recovery Fund resources detailed in Appendix 2 to the report;

(d)       note the progress made in achieving Financial Plan savings in Appendix 3 the report; and

(e)        approve the virements attached as Appendices 4 and 5 to the report.