Agenda item - Targeted Budget Management (TBM) 2019/20: Month 2

Report of the Executive Director Finance & Resources (copy attached)

RESOLVED: That the Committee -

1.    Noted the forecast risk position for the General Fund, which indicates a budget pressure of £3.427m. This includes an overspend of £0.099m on the council’s share of the NHS managed Section 75 services.

2.    Noted that the one-off financial risk safety net of £1.065m is available to mitigate the forecast risk if the risks cannot be completely eliminated by year-end.

3.    Noted the forecast for the Housing Revenue Account (HRA), which is currently an underspend of £0.320m.

4.    Noted the forecast risk position for the Dedicated Schools Grant which is an overspend of £0.102m.

5.    Noted the forecast outturn position on the capital programme and approve the variations and slippage in Appendix 5 and the new schemes as set out in Appendix 6.

6.    Agreed the proposed funding of Non-Schools Term Time Only back pay as set out in paragraphs 6.3 to 6.5.

7.    Noted the proposed funding of Schools Term Time Only back pay as set out in paragraphs 6.3 to 6.5.

8.    Agreed to explore further options for the proposed funding of Schools back pay and asks for it to be considered by the Schools Forum.

27.1    The Committee considered the report of the Executive Director Finance & Resources which set out early indication forecast risks as at Month 2 on the Council’s revenue and capital budgets for the financial year 2019/20.

27.2    The Chair noted that two amendments had been submitted by the Green and the Conservative Group, and asked Councillor Shanks to present the Green Group amendment.

27.3    Councillor Shanks said there was currently considerable cuts to school funding and the Green Group wanted to ensure that there wasn’t an extra burden put on schools, and whilst the half payment was welcomed it would be useful to look again to see if there were other options to find the money from somewhere else and to consult with Head Teachers to do that. Councillor Shanks formally proposed the following amendment (changes in bold):

2.1       That the Committee note the forecast risk position for the General Fund, which indicates a budget pressure of £3.427m. This includes an overspend of £0.099m on the council’s share of the NHS managed Section 75 services.

2.2      That the Committee note that the one-off financial risk safety net of £1.065m is available to mitigate the forecast risk if the risks cannot be completely eliminated by year-end.

2.3      That the Committee note the forecast for the Housing Revenue Account (HRA), which is currently an underspend of £0.320m.

2.4      That the Committee note the forecast risk position for the Dedicated Schools Grant which is an overspend of £0.102m.

2.5      That the Committee note the forecast outturn position on the capital programme and approve the variations and slippage in Appendix 5 and the new schemes as set out in Appendix 6.

2.6       That the Committee agrees the proposed funding of Schools and Non-Schools Term Time Only back pay as set out in paragraphs 6.3 to 6.5.

2.7      That the Committee notes the proposed funding of Schools Term Time Only back pay as set out in paragraphs 6.3 to 6.5.

2.8      That the Committee agrees to explore further options for the proposed funding of Schools and Non-Schools Term Time Only back pay and asks for it to be considered by the Schools Forum.

27.4    Councillor Osborne seconded the amendment.

27.5    The Chair asked Councillor Bell to present the Conservative Group amendment.

27.6    Councillor Bell said that his group had met with Head Teachers in the city and they were concerned that they should not be burdened with a potential extra cost against them of £1.7m, as that money would impact on the education of children in the city and offering them 50% and expecting them to fund the rest of it was unacceptable. The Council should be looking to offset some of the money from the Waste PFI reserve. Councillor Bell formally proposed the following amendment (changes in bold):

2.1       That the Committee note the forecast risk position for the General Fund, whichindicates a budget pressure of £3.427m. This includes an overspend of£0.099m on the council’s share of the NHS managed Section 75 services.

2.2      That the Committee note that the one-off financial risk safety net of £1.065m is available to mitigate the forecast risk if the risks cannot be completely eliminated by year-end.

2.3      That the Committee note the forecast for the Housing Revenue Account (HRA), which is currently an underspend of £0.320m.

2.4      That the Committee note the forecast risk position for the Dedicated Schools Grant which is an overspend of £0.102m.

2.5      That the Committee note the forecast outturn position on the capital programme and approve the variations and slippage in Appendix 5 and the new schemes as set out in Appendix 6.

2.6      That the Committee agree the estimatedproposed funding of Schools and Non-Schools Term Time Only back pay liability of £4.154m as set out in paragraphs 6.3 to 6.5.  be funded from the council’s General Fund utilising cash balances relating to the earmarked Waste PFI reserve.

2.7       That the Committee agree to increase the contribution from the General Fund revenue budget (set out in paragraph 6.4) from £296,800 to £485,400 per annum for 10 years.

27.7    Councillor Janio seconded the amendment.

27.8    Councillor Childs said that all Councillors were concerned with the situation schools found themselves in, and the Council had sought to alleviate the immediate costs to schools and recognised the severe funding crisis schools were in. He said that the money had to come from somewhere and thought that the recommendations in the report were correct. He suggested that a joint letter from all parties be sent to the Secretary of State to ask if there could be a possible one-off grant funding.

27.9    Councillor Mac Cafferty asked for confirmation that one-off resources were not being used to inflate the base budget. The Deputy Chief Finance Officer said that in this case the intention was to use Waste PFI reserves, which were one off resources committed against the PFI contract. Those reserves were not needed right now, and so they could be used to help schools and the General Fund to spread the cost over ten years but would need to be replenished.

27.10  The Chair said that at a recent Leaders Group meeting (attended by the leaders of the three political parties), she understood that there had been an agreement to look at a 50/50 split between the Council and Schools and that they would ask the Government for funding and was therefore surprised at the comments made today. 

27.11 The Monitoring Officer noted the Green Group amendment and said that if it were agreed and the matter referred to the Schools Forum, if any changes were suggested by them it would need to come back to this committee.

27.12 The Committee voted on the Green Group amendment and it was agreed. The Committee then voted on the Conservative Group amendment and it was not agreed. The Committee then voted on the recommendations as amended and they were agreed.

27.13  RESOLVED: That the Committee -

1.    Noted the forecast risk position for the General Fund, which indicates a budget pressure of £3.427m. This includes an overspend of £0.099m on the council’s share of the NHS managed Section 75 services.

2.    Noted that the one-off financial risk safety net of £1.065m is available to mitigate the forecast risk if the risks cannot be completely eliminated by year-end.

3.    Noted the forecast for the Housing Revenue Account (HRA), which is currently an underspend of £0.320m.

4.    Noted the forecast risk position for the Dedicated Schools Grant which is an overspend of £0.102m.

5.    Noted the forecast outturn position on the capital programme and approve the variations and slippage in Appendix 5 and the new schemes as set out in Appendix 6.

6.    Agreed the proposed funding of Non-Schools Term Time Only back pay as set out in paragraphs 6.3 to 6.5.

7.    Noted the proposed funding of Schools Term Time Only back pay as set out in paragraphs 6.3 to 6.5.

8.    Agreed to explore further options for the proposed funding of Schools back pay and asks for it to be considered by the Schools Forum.