Agenda item

Financial Monitoring Quarter 2 Report

To consider the report of the Cabinet Member for Performance and Resources presenting the year-end forecasts, financial pressures on the Council during the Quarter ended 30th September  2023 and performance against certain financial performance indicators.


67.1    The Cabinet Member for Performance and Resources, Councillor Hannah Norman, introduced the report. She advised that the report sought to outline year-end forecasts and the financial pressures on the Council during Quarter 2 ending in September 2023, as well as the performance of the Council against certain key performance indicators. Councillor Norman highlighted that the forecast year end position was currently a decrease of the Council’s General Fund balance of £1,078k against a budgeted decrease of £104k.


67.2    Councillor Norman referred to 4.3 in the report and highlighted that key pressures facing the Council included temporary accommodation costs which were at an overspend of £456k, however she noted that the position had improved due to Council’s decision to acquire emergency temporary accommodation. Councillor Norman outlined that further pressures included the decline in planning income as a result of development costs increases, and the closure of Longsmith Car Park and costs associated with lost income and repair maintenance work.


67.3    The Chair asked whether Longsmith Car Park was likely to be open before the end of the financial year. Councillor Norman explained that she was awaiting the final report measures, however Financial Monitoring reports and estimates tended to be on the pessimistic side.


67.4    In response to a further query from the Chair as to what was meant by ‘NJC Green Book staff’, the Head of Finance and Resources confirmed that this referred to the National Joint Council.


67.5    The Chair asked whether Councillor Norman was worried about the financial outlook. Councillor Norman replied that currently, local government finance was challenging, with inflationary pressures impacting on every local authority, however she had confidence that Officers and the administration would take the necessary decisions in the Council’s financial interest.


67.6    Councillor Wilson referred to the £500k utility charge for Aspire Trust and asked whether the Council had managed to recover any of this debt. The Head of Finance and Resources confirmed that this £500k was an historic debt from the previous financial year. In response to a further question from Councillor Wilson as to whether there was any possibility of the Council reclaiming any of this money, the Head of Finance and Resources noted that this was a possibility however it was dependent on the Aspire Leisure Trust’s liquidators.


67.7    Councillor Hilton asked whether the administration had any intention to sell Gloucestershire Airport.  Councillor Norman confirmed that no formal discussions had taken place at Cabinet level but invited Members to put forward any questions they had to the Leader of the Council, as the relevant Cabinet portfolio holder, at the next Cabinet Meeting.


67.8    Councillor Hilton reflected on conversations he had had with Cabinet Members at Cheltenham Borough Council regarding a possible sale. Councillor Norman reiterated that no formal discussions had taken place at Cabinet level, however Councillor Hilton could ask the Leader of the Council at the upcoming Cabinet meeting if he so wished.


67.9    Councillor Hilton observed that there was currently no upcoming decision pertaining to Gloucestershire Airport in the Cabinet Forward plan and stated that no discussions had taken place with political Group Leads. He noted that he would hope for full disclosure of the options being considered as the Airport was an important asset in the County. Councillor Norman confirmed that the administration was committed to complying with all consultation and decision procedures, including Forward Plan notice requirements and the option for any report to be brought to the Overview and Scrutiny Committee.


67.10  In response to a query from Councillor A. Chambers regarding the £24k overspend outlined at 5.17 in the report, Councillor Norman explained that this related to Senior Management costs.


67.11  In response to an additional question from Councillor A. Chambers, the Managing Director explained that the Council paid a flat fee of £50k a year for 2.5 days a week for Monitoring Officer resource. He noted that there was no daily rate for this work and that this figure compared favourably to staffing costs previously incurred for interim Monitoring Officers in recent years. The Managing Director further confirmed that he was satisfied that the Council was getting its fair share of Monitoring Officer resource.


67.12  Councillor A. Chambers referred to the £617k overspend in Homelessness and Housing and asked whether the overspend was due to costs associated with housing asylum seekers. Councillor Norman confirmed that housing for asylum seekers was funded by the Home Office. She noted that reasons for this budgetary pressure varied from the cost of accommodation and changes to local housing allowances, and confirmed that this was the reason the Council had opted to acquire more emergency temporary accommodation.


67.13  In response to a further question from Councillor A. Chambers regarding the variance around HR and Communications, Councillor Norman explained that this related to the shared Communications Service with Gloucestershire County Council, including press and social media communications, rather than the Council’s postal arrangements. The Head of Finance noted that this also included recruitment costs, such as advertising.


67.14  Councillor A. Chambers asked for further information around the £125k overspend in Cemeteries and the Crematorium. Councillor Norman explained that this was linked with the substantial rise in energy costs and the fact that cremators use large amounts of energy. She noted that the Council might need to compare its fees and charges in this area with other Councils.


67.15  Councillor A. Chambers asked whether the cremator was being replaced, to which Councillor Norman confirmed that the Council was in the process of replacing the cremator.


67.16  In response to an additional question from Councillor A. Chambers, Councillor Norman confirmed that the administration had ambitions for the city of Gloucester to grow and be attractive for residents and visitors. She expressed her hope that regeneration in the city, through projects such as the Forum development, would attract more investment opportunities which in turn, would generate more footfall for local businesses and feed through to other areas of the city. She expressed that she was proud of the investment the Council had made in the city.


67.17  Councillor Hilton referred to the narrative in the report at 4.4. He asked for further information about the grant submission to Sports England. He also asked in relation to the property purchases to increase the availability of temporary accommodation, how close the Council was to making the properties fit for occupation. Councillor Norman confirmed that offers had been made on various properties, and that the Council had discounted making offers on properties which required lots of work to make them fit for occupation. In relation to the Sports England bid, the Managing Director advised Members that the Council had submitted a bid in August for around £1m in capital funding, and that it was anticipated that successful bids would be announced in January 2024.


          RESOLVED – That the Overview and Scrutiny Committee NOTE the report.

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