To consider the quarterly budget position.  

That the financial performance information for the third quarter of 2018/19 be NOTED.  

71.1           The report of the Head of Finance and Asset Management, circulated at Pages No. 12-21, provided the financial performance information for the third quarter of 2018/19 which Members were asked to consider.

71.2           The Head of Finance and Asset Management explained that the report highlighted a quarter three surplus of £664,478 on the revenue budget as well as detailing the expenditure to date against both the capital programme and approved reserves. The summary of the expenditure position for the Council, split out between the main expenditure types, was shown at Paragraph 2.2 of the report. The budget position in relation to the Heads of Service responsibility showed a budget surplus of £311,964 as at the end of December. The majority of the savings (£337,960) related to employee costs, mainly through staff vacancies. In addition, there were a range of smaller savings being made across the headings of ‘premises’ and ‘transport and supplies’ which were also contributing to the overall surplus reported. The surplus on income was £127,444 much of which was from Community Services, mainly in relation to the garden waste service which had seen income above target due to the changes made in respect of the new sticker system and the fixed renewal date of 1 April. There was also additional income shown in Corporate Services which related to grant income for the Benefits Team from central government which had not been budgeted for. The positive income position was being offset by planning application income which was below the expected target and, although a surplus had been returned in quarter three, there remained a deficit against the target. In terms of the corporate codes, these were generally doing well apart from the deficit noted on the ‘corporate savings target’ heading which related to the expected savings in employee costs throughout the year; however, given the surplus on the employees line, that had more than been met.

71.3           In respect of the deficits being reported, the most significant related to the Ubico contract which had a projected overspend of £230,887 – this was a significant increase from the £141,622 position which had been reported in quarter two. It was hoped the projected deficit would be smaller when the final position was reported. The reasons for the overspend were reported by Ubico as being increased employee costs of £89,818, mostly for the use of agency staff to cover increasing numbers of long-term sickness; and transport costs of £99,620 of which the majority related to the maintenance of the recycling and grounds maintenance equipment and vehicles with increased fuel costs across all service areas; and an overspend on tyres of £59,000. In addition, there was an increased cost associated with the grounds maintenance service as a result of the difficulties encountered at the start of the grass cutting season in 2018. The projected full-year overspend of £230,887 was being met by the surplus generated in other service areas and corporate activities, and Officers were working with Ubico to understand its accounting  ...  view the full minutes text for item 71