Agenda item

The report summaries both the performance and financial outturn position across the Authority as at 31 March 2024.  It also deals with a number of procedural matters as the Authority moves into the new financial year.

Cabinet received a report which summarised both the performance and financial outturn position across the Authority as at 31 March 2024.  It also dealt with a number of procedural matters as the Authority moved into the new financial year.

For performance, the report set out the key areas of service delivery for Cabinet to note, including where this impacted on the Authority’s budget.  In terms of the budget, it set out the outturn position at 31 March 2024 for both revenue and capital.  Cabinet noted that following the changes in the structure of the Senior Leadership Team, the budget monitoring report had been restated compared to earlier in the year.

The Authority’s draft Statement of Accounts (the Accounts) for 2023/24 was due to be presented to the Audit Committee for approval on 29 May 2024.  However, as reported to the Audit Committee, there had been a number of national accounting matters that had delayed the audit of the 2022/23 Statement of Accounts and consequently, would delay the auditing of the 2023/24 Statement of Accounts.  Therefore, the outturn figures contained in this report were provisional until the completion of the 2022/23 and 2023/24 accounts.

The Accounts were a statutory document that set out the Authority’s financial position and performance for the year in a series of formal statements prepared according to a specific statutory and regulatory framework, which made it a very technical document.  As in previous years, this report sets out the Authority’s financial performance in an outturn report which reflected the Authority’s structure and the reports presented to Cabinet throughout the year.

From a performance point of view, service delivery overall across the Authority remained strong.  The Authority continued to manage high levels of demand in a number of areas including Education, Health and Care Plans (EHCPs), children in care, children in need, home care provision, residential and nursing care placements all of which had financial implications. Key areas of strength were delivery of the Our North Tyneside Plan 2021-2025 priorities such as the affordable homes programme and carbon net zero.  The Ambition for North Tyneside Programme was progressing well with regeneration projects across the four areas of the borough.  Capital investment continued to deliver planned improvement works helping maintain council homes at the decent homes standard.  Council Tax and Business Rates collection also remained on track.  

The Authority continued to see areas of pressure across Adult and Children’s Social Care, but there were also significant impacts on income particularly across Home to School Transport and Catering Services.

Since the last report, the number of children in the Authority’s care had decreased by 15.  There were 352 Children in the Authority’s care at the end of March, including 15 unaccompanied asylum-seeking children. This was a reduction from 367 in January 2024.  However, this remained higher than the 330 children budgeted for.  Although the number of children in the Authority’s care had decreased as stated above, there had been a further increase in the number of external residential placements which, together with the additional costs already incurred to date, had contributed to the overall overspend position.  The result of the number of children in the Authority’s care combined with the current mix of placements had driven a total outturn overspend of £12.804m. There were 1,736 ‘children in need’ at the end of March 2024. The number of Children in Need fluctuated each month but remained consistently higher than the 1,600 children budgeted for.

From a budget perspective, the overall unadjusted outturn for 2023/24 General Fund was an overspend of £7.229m. Despite the operational pressures on Adults and Children’s Social Care, Home to School Transport and Catering resulting in a combined overspend of £22.076m, other service areas had managed to mitigate the overall impact on the Authority’s position to give an improvement of £1.130m since the January 2024 report.

As previously communicated, any overspend would need to be funded through the use of reserves. Senior Officers, in conjunction with Cabinet, had undertaken a thorough review of the reserves held and the report set out the proposed release of £6.842m from earmarked reserves to support the position. The remaining balance of £0.387m was proposed to be taken from the Strategic Reserve. After these transfers, the General Fund would be in balance for 2023/24.

School balances had continued to decrease from a deficit of £0.382m at the start of the financial year to a deficit of £2.930m as at 31 March 2024. This was after the allocation of £1.868m Department for Education (DfE) funding given as “Financial Support for local authorities supporting maintained schools in financial difficulty (2023 to 2024)” had been applied to school balances. 

Within this, 19 schools were in a deficit position at 31 March 2024. Whilst most of these were marginal deficits, 4 schools had a deficit totalling £12.955m.  This continued to be monitored closely and schools in a deficit position during the year had support via continued peer-to-peer advice through the Department for Education’s School Resource Management Advisers (SRMA) or deficit clinics with officers.  Further details were contained in Section 2 of the Annex.

The Housing Revenue Account (HRA) had year-end balances of £3.064m.  The HRA showed an underspend of £0.133m against the in-year 2023/24 Budget, together with a £0.095m improvement in the budgeted brought forward balances, which cumulatively brought the HRA to £0.228m better than the budgeted position for 2023/24.  Further details were given in Section 3 of the Annex.

The initial approved Investment Plan for 2023/24 was £95.762m.  Net variations and reprogramming of £4.162m were approved by Cabinet during 2023/24 to give a revised Investment Plan of £91.600m.  Capital expenditure for the year was £85.953m (93.84% of the revised plan).  This outturn included further reprogramming of £11.166m and variations relating to gateway approvals and grant determinations of £5.519m for the 2023-2028 investment plan as shown in Section 4 of Annex 2.

Cabinet considered the following decision options: To approve the recommendations set out in paragraph 1.2 of the report, or alternatively, to not agree the recommendations.

Resolved that (1) the provisional 2023/24 performance and finance outturn

for the General Fund, Schools Finance and Housing Revenue Account

(Annex 1, Annex 2, Sections 1, 2 and 3) together with a financial overview of

the year, be noted;

(2) the decisions made under the Reserves and Balances Policy (Paragraph 1.5.8, and Appendix A), be noted;

(3) the Authority’s Investment Plan spend during 2023/24, and the associated capital financing (Annex 2, Section 4), be noted;

(4) the receipt of £0.992m new revenue grants, be approved;

(5) the receipt of £2.945m new capital grants, be approved;

(6) the reprogramming of £11.193m within the 2023/24 Investment Plan (Annex 2, Section 4, Paragraph 4.22 and Appendix C), be approved;

(7) variations of £5.546m to the Investment Plan (Annex 2, Section 4, Paragraph 4.22), be approved;

(8) the Authority’s Treasury Management performance (Annex 2, Section 5), be noted;

(9) the Authority’s performance against the Capital and Treasury prudential indicators (Annex 2, Section 5 and Appendix D, be noted);

(10) the write-offs of business rates identified (Table 30, Annex 2, section 7), be approved; and

(11) the North Tyneside Productivity Plan to submit to the Department for Levelling Up, Housing & Communities and publication on the Council’s website, be approved.

(Reason for decision:  It is recommended that Cabinet agree the proposals set out in section 1.2 of this report as it forms part of the 2023/24 Final Accounts process. Reprogramming of the Investment Plan will ensure successful delivery of projects included within the Investment Plan.)