To consider and scrutinise the Council’s financial performance information for the first quarter of 2017/18.

That the financial performance information for the first quarter of 2017/18 be NOTED.  

33.1           The report of the Head of Finance and Asset Management, circulated at Pages No. 14-22, highlighted the Council’s financial performance for the first quarter of 2017/18 and asked Members to consider that information.

33.2           The Head of Finance and Asset Management explained that the report before the Committee was the first monitoring report of 2017/18 and provided details to the end of June 2017. Members were advised that the table at Paragraph 2.2 set out a summary of the expenditure position for the Council split between the main expenditure types. Currently there was a £225,836 surplus against the profiled budget which was a good position to be in. The budget position in relation to the Heads of Service responsibility showed an underspend of £157,537 as at the end of June and Paragraph 2.3 provided an explanation of the three main areas of savings which were employee costs £67,150; payments to contractors of £17,809; and income of £47,582. The employee cost savings were generated mainly through staff vacancies and maternity leave where services had managed vacancies in the short term with limited use of agency staff and help from current staff to cover work. The underspend on payments to contractors was generated from small savings across all services, with the most significant saving being on the current Materials Recovery Facility (MRF) recycling contract as a result of a lower than anticipated gate fee per tonne. This was a new contract from April 2017 and would be monitored closely over the next quarter to see if the underspend was carried forward as the market price of recyclable materials fluctuated. In terms of planning income, this continued to be significant. Car parking and licensing were performing well so far this year, however, garden waste was struggling to hit budget which appeared to be as a result of the changes to the charging structure whereby customers were making pro rata payments for this financial year. There was not an indication that the number of users had dipped but would need monitoring over the next quarter to confirm if the lower income was as a result of the one-off move to a single renewal date.

33.3           Attention was drawn to Appendix A to the report, which showed the summary position for each Head of Service and the current variance against their budget – a short explanation was provided for variances over £10,000. Detailed under the corporate budgets was the retained income from the business rates scheme which showed a surplus of £97,000; this was a prudent prediction of the year-end position although it should be noted that so far there had been very little activity with regard to processing appeals either from past appeal listings or those against the new 2017 list. The Council had set aside a significant provision to cover additional appeals and it was hoped this would be sufficient in meeting successful appeals thereby allowing the Council to benefit from wider increases in business rates income. Appendix B to the report set out the capital budget position which was currently showing a significant underspend against the profiled budget as a result of projects such as the purchase of new waste vehicles – which had not been completed within the expected timescales - and disabled facilities grants being underspent against what had been expected. In terms of the waste vehicles all had now been delivered and this would be shown in the figures for the next quarter. Appendix C showed the reserves position but did not take account of reserves which had been committed but not yet paid. The quarter one position showed a significant balance on the reserves but it was the expectation that those balances would be spent in the future. The Head of Finance and Asset Management drew particular attention to Note 4 on Appendix C and indicated that it should read “£837,000 of the reserve is being used to support the base budget in 2017/18 with £330,000 available for future years”.

33.4           During the discussion which ensued, a Member questioned whether the elections reserve of £63,000 would be sufficient if another general election was called. In response, the Head of Finance and Asset Management explained that, if a general election was called, the government would pay the costs of that election. The Council’s reserve was specifically for its own Borough and Parish elections which were due in 2019. In response to a further query regarding Neighbourhood Development Plan Referendums, the Head of Finance and Asset Management confirmed that funding was drawn down from the government to finance part of those expenditure requirements. In terms of car parking fees, Members were advised that they had been reviewed in 2014. During 2015/16 income had exceeded expectations and had continued to grow due to increased usage and dwell times but there had been no increase in fees and charges. Referring to the amount of time that business rates appeals took, the Head of Finance and Asset Management explained that it could take a couple of years before they were finalised but the Valuation Agency was working slightly quicker now than in previous years. There was nothing registered on the appeals list for this year as yet but Officers were expecting some so had set aside substantial provisions which it was hoped would be sufficient. In response to a Member’s query regarding ICT, the Head of Finance and Asset Management confirmed that there were further monies available for ICT through the New Homes Bonus funding if it was needed. The finance team worked closely with the ICT Manager and his team to ensure the correct amount of resources were available.

33.5           Accordingly, it was