Issue - meetings

To receive the third budget monitoring report for the current financial year which reflects the forecast financial position as at 31 March 2020.   

Cabinet considered the third monitoring report outlining the Authority’s 2019/20 financial position which provided an update on the expected revenue and capital financial position of the Authority as at 31 March 2020.

Thereport covered the forecast outturn of the Authority’s General Fund and Housing Revenue Account (HRA) revenue budget including management mitigations where issues had been identified; the delivery of2019/20approved budget savingsplans; and an update on the Capital Investment Plan, includingdetails of variations and reprogramming, that were recommendedforapproval.

The forecast overall pressure on the General Fund was estimated at £4.809m against the approved net budget of £155.730m.  This was driven mainly by Health, Education, Care and Safeguarding reflecting the continued pressures in Children’s Services of £4.615m and Adult Services of £1.384m, partly mitigated by the contingency balances that had been created by Cabinet as part of the 2018/19 budget setting process and continued to be held centrally to reflect the on-going pressures in social care being felt locally and nationally. Included in this projection was £3.656m of pressures in Corporate Parenting and Placements and £2.178m in Wellbeing and Assessment.  The drivers for these pressures continued from 2018/19, as outlined in the report.

The other main areas of pressure existed within the Resources section, primarily due to additional costs within ICT Retained Services.  It was anticipated that the overall outturn forecast would improve over the course of the financial year as planned remedial actions began to impact on both expenditure and income.  

The HRA was forecast to have year-end balances at 31 March 2020 of £7.585m, which was £3.714m higher than budget which was set at £3.871m.  The higher than forecast balances were mainly as a result of higher opening balances due to the impact of the previous year’s financial performance (£1.101m) but there was also an in-year estimated overall underspend of £2.613m, against an in-year budget of £2.331m, due to additional income of £0.496m combined with reduction to expenditure of £2.117m, which was linked to savings identified following the end of the Kier JV from April 2019.

Universal Credit had been fully implemented across North Tyneside on 2 May 2018. As of the end of September 2019, 2,850 North Tyneside Homes tenants had moved on to Universal Credit and a team was working proactively with tenants to minimise arrears.  This position would be closely monitored as the year progressed to identify any adverse impacts on the budget position.  

The total planned schools’ deficit for 2019/2020 was £5.045m. The trend for reducing school balances continued, and some individual schools continued to face significant financial challenges. There were nine schools with approved deficits in 2018/19, five of which continued to be in deficit for 2019/20.  Six schools were also new to deficit in 2019/20.   

The High Needs Block had ended 2018/19 with a pressure of £0.920m.  Initial forecasting of the budget position for 2019/20 indicated a similar level of pressure within the year of £0.952m.  In line with the national picture, there had been  ...  view the full minutes text for item 69