To consider the quarterly budget position.  

That the financial performance information for the first quarter of 2019/20 be NOTED.  

28.1           The report of the Head of Finance and Asset Management, circulated at Pages No. 12-20, highlighted a quarter one deficit on the revenue budget and detailed the expenditure to date against both the capital programme and the approved reserves. Members were asked to consider the financial performance information for the first quarter of 2019/20.

28.2           Members were advised that the financial position for the first three months of the year was showing a deficit of £71,190; this was unusual at this stage and the variances were highlighted for Members’ information at Paragraph 2.1. There was a surplus of £67,966 on vacant positions and of £5,839 on transport which was encouraging. However, in terms of the deficit, the depot costs had increased as a consequence of the depot review undertaken in 2017 which had seen Tewkesbury’s usage increase due to the food waste collection service being delivered through separate vehicles; Officers had reviewed that cost apportionment and agreed it reflected the current usage of the site. Transfer payments for the benefit service were in deficit by £29,557 due to two significant overpayments which the Council was in the process of recouping; around 40% could be claimed in government subsidy but the Council was also able to recover 100% from the claimant so it was actually possible to recoup 140%. Finally, income was showing a small deficit at the end of quarter one with planning income being below target by £80,000 – although the Development Team had predicted it would recover and achieve the budgeted level of income by the end of the financial year. It was important to note that the way the financial position was reported meant that, whilst some expenditure was outside of the budget, there would be some income to recoup e.g. the European elections would be paid for by the government and, whilst Ubico was currently showing a £24,000 deficit which was largely in relation to grounds maintenance, there was a contingency to cover that spending should it remain in deficit at year-end. In terms of corporate codes, there was a significant budget deficit being shown on investment properties due to the Council not being able to secure another commercial property; this had meant income expected to be received in rent had not been achieved. The Council’s advisors continued to search for suitable quality acquisitions.

28.3           The Head of Finance and Asset Management indicated that the reported deficit at this stage was disappointing; however, with service areas still expecting to deliver full year income levels, there was no corrective action suggested at this stage. The position would be kept under review by the management team and it may need to consider some action in the future. He felt that, having just benefited from a year of significant surplus, the revenue budget for the current year could not be allowed to return a deficit which would necessitate having to utilise the reserves set aside for specific projects and future financial sustainability. The reserves position was attached to  ...  view the full minutes text for item 28