Contact your Parish Council

Appendix 1

 

Second Quarter Budget Monitoring 2019/20
Economic Regeneration & Leisure Committee
29th October 2019
Lead Officer:  Mark Green
Report Authors: Chris Hartgrove/Paul Holland

 

 

Contents 

 

 


Executive Summary                                                                            Page         2

 

Part A: Second Quarter Revenue Budget 2019/20        

A1)    Revenue Budget: Council                                                        Page         4

A2)    Revenue Budget: Economic Regeneration & Leisure        Page     5

A3)    Revenue Budget: Significant Variances (>£30,000)         Page     6

 

Part B: Second Quarter Capital Budget 2019/20       

B1)    Capital Budget: Council                                                           Page         8

B2)    Capital Budget: Economic Regeneration & Leisure           Page     8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Executive SummaryThis report provides Members with an overview of progress against the 2019/20 revenue and capital budgets as at 30th September 2019 (i.e. the Quarter 2 cumulative position) for the services falling within the remit of the Economic Regeneration and Leisure Committee (ERL). The analysis also includes both revenue and capital year-end projections (to 31st March 2020) for ERL services, as well as some important context, with consideration given to the Council’s overall position. 

The headlines for Quarter 2 are as follows:

Part A:  Second Quarter Revenue Budget 2019/20

·         Overall net expenditure for the services reporting to ERL is £1.262 million, compared to the profiled budget of £1.311 million, representing an under spend of £49,000. ERL is also expected to remain within its overall net revenue expenditure budget for the year, recording a small under spend of £5,000 against its budget of £2.175 million.

 

·         Overall net expenditure for the Council overall is £6.813 million, compared to the profiled budget of £7.553 million, representing an under spend of £0.74 million. The Council is also expected to remain within its overall net revenue expenditure budget of £21.138 million for the year.

Part B:  Second Quarter Capital Budget 2019/20

·         Capital expenditure for the services reporting to ERL of £420,000 has been incurred against the annual budget of £2.775 million. At this stage, it is anticipated that there will be slippage of £2.29 million.

 

·         Capital expenditure for the Council overall of £4.608 million has been incurred against the annual budget of £51.754 million.

 


 

 

 

 

 

 

 

Part A
Second Quarter Revenue Budget 2019/20
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


A1)   Revenue Budget: Council

A1.1  At the Quarter 2 stage, overall net expenditure for the Council is £6.813 million, compared to the profiled budget of £7.553 million, representing an under spend of £0.74 million. Based on forward projections, the Council is expected to remain within its overall net revenue expenditure budget of £21.138 million for the year.

A1.2  The two charts below show the income and expenditure position for each service committee.

               Chart 1:    MBC Revenue Budget: INCOME BY SERVICE COMMITTEE

Chart 2:    MBC Revenue Budget: EXPENDITURE BY SERVICE COMMITTEE

 

 

A2)   Revenue Budget: Economic Regeneration & Leisure (ERL)

A2.1  Table 1 below provides a detailed summary on the budgeted net expenditure position for ERL services at the end of Quarter 2. The financial figures are presented on an ‘accruals’ basis (e.g. expenditure for goods and services received, but not yet paid for, is included). 

Table 1:     ERL Revenue Budget: NET EXPENDITURE

A2.2  The table shows that, at the Quarter 2 stage, overall net expenditure for the services reporting to ERL is £1.262 million, compared to the profiled budget of £1.311 million, representing an under spend of £49,000. Based on forward projections, ERL is expected to remain within its overall net revenue expenditure budget for the year, recording a small under spend of £5,000 against its budget of £2.175 million.

A3)   ERL Revenue Budget: Significant Variances (>£30,000)

A3.1  Within the headline figures, there are a number of both adverse and favourable net expenditure variances for individual cost centres. It is important that the implications of variances are considered at an early stage, so that contingency plans can be put in place and, if necessary, be used to inform future financial planning.

A3.2  Table 2 below highlights and provides further detail on the most significant variances i.e. those meeting or exceeding £30,000, either at the end of Quarter 2, or expected to do so by year-end.


 

Table 2:     ERL Variances >£30,000 (@ Quarter 2)

 

Positive Variance

Q2

Adverse

Variance

Q2

Year End Forecast Variance

Economic Regeneration & Leisure Committee

 

£000s

Mote Park Adventure Zone - the facility is now open. However, the contract awarded allows for an initial rent free period for the first three months and the final contract value was less than forecast.

 

 

-28

-55

 

Parks and Open Spaces - residual undelivered savings of £63,000 in respect of a previous re-structure is the most significant factor in the overspend.

 

 

-35

-61

 

Crematorium – higher than budgeted maintenance costs, partly driven by un-accrued (maintenance) expenditure from 2018/19 (of £18,000) is the reason for the budget pressure at the Quarter 2 stage, although the budget is expected to be met by year end. 

 

 

-60

+21

Community Environmental Engagement – the variance is caused by a timing difference; the appointment of a temporary Community Engagement Officer (as part of a Business Rates Retention funded initiative) was later than assumed within the budget provision.

 

+31

 

+31

Economic Development Section - the variance predominantly relates to salary savings due to two vacant posts.

 

+40

 

+54

Salary Slippage – There is a credit budget to allow for the fact that services usually underspend on salaries, owing to temporary vacancies arising from staff turnover.  This is currently an adverse variance from the salary slippage budget, but the actual service underspends (such as that for Economic Development above) will be offset against the salary slippage budget at year end and are expected to eliminate the adverse variance.

 

 

-27

-54

 


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Part B 

 

 

 

 

 

 

Second Quarter Capital Budget 2019/20 

 

 

 

 


 


B1)   Capital Budget: Council

B1.1  The overall five-year Capital Programme for 2019/20 to 2023/24 was approved by the Council on 27th February 2019. Most capital funding will now come from prudential borrowing as other sources of funding are not sufficient to cover the costs of the Programme, although funding does continue to be available from the New Homes Bonus (NHB). At the time of preparing this report there has been no need to borrow, but it is anticipated that borrowing will be needed during the latter half of 2019/20.

B1.2  The 2019/20 element of the Capital Programme has a total budget of £51.754 million. At the Quarter 2 stage, capital expenditure of £4.608 million has been incurred.

B2)   Capital Budget: Economic Regeneration & Leisure Committee (ERL)

B2.1  Progress towards the delivery of the 2019/20 ERL element of the Capital Programme at the Quarter 2 stage is presented in Table 3 below. The budget for 2019/20 includes resources brought forward from 2018/19.

B2.2  At the Quarter 2 stage, expenditure of £420,000 has been incurred against a budget of £2.775 million. At this stage, it is anticipated that there will be slippage of £2.29 million (the Committee will be asked to approve/note the carry forward of resources into the next financial year).

Table 3:     ERL Capital Programme 2019/20 (@ Quarter 2)

B2.3  There are two significant items to highlight in the table above:

§  Mote Park Adventure Zone – the over spend relates to the additional costs incurred as a result of the sewage leak in the Park that significantly delayed project completion. The costs are the subject of an ongoing legal claim, so the overspend is being temporarily funded until the outcome of the claim is known; and

 


 

§  Mote Park & Estates Services Building – The budgets have now been combined as the construction of this facility will be let as a single contract. At this stage, the timing of the building works has not been determined; the forecast assumes they will not begin until April 2020.