Agenda item

This report is due to be/was considered at Mayor and Cabinet on 21 June 2023

That the report be noted.

5.1    Nick Penny (Head of Service Finance) introduced the report – setting out key areas of overspending and pressures at the end of the 2022-23 financial year in the general fund, housing revenue account and dedicated schools grant.

5.2    Nick Penny, Kathy Freeman (Executive Director for Corporate Resources) and Katherine Nidd (Director of Finance) responded to questions from the Committee – the following key points were noted:

·         Adult social care still needed to deliver some savings in this financial year – which, when delivered, would complete the Newton savings programme. Improvements to ways of working adult social care should also result in further savings in future financial years. The programme had changed the culture within the directorate.

·         All of the refunds required from Thames Water had been processed – which had reduced the levels of debt owed.

·         There was a challenge in legal services as a result of workloads – which required some work to be commissioned from external providers (and created a cost pressure)

·         The Council was actively pursuing Council tax debts – but this had to be balanced with sensitivity regarding individual cases.

·         There were changes being made to the arrears process for Council tax in response to the cost of living crisis. This would communicate and highlight the support available earlier in the collections process.

·         Further information would be provided on the level of debt that triggered enforcement activity.

·         Most of the debt collection work was carried out by the in-house enforcement team – although some difficult to recover debts were contracted out for external enforcement.

·         Consideration was given to debtors’ ability to pay – which was used to inform the process for enforcing debts.

·         More information could be provided on the numbers of people who were unable to pay as opposed to the numbers of people who it was believed were unwilling to pay.

·         Work had taken place to align revenues and benefits teams at the Council but the levels of staffing in these teams had remained broadly similar.

·         Further information would be provided on the relationship between spending to collect debts through enforcement activity and the value of the funds that could reasonably be recovered from this activity.

·         The debtors team were proactive in chasing debts from adult social care. However, this was an area in which debts were increasing.

·         The finance team were confident that adult social care was giving consideration to the recovery of debt – but it was a challenging area to enforce.

·         A number of funds made up the £39m of ‘corporate items’ held by the Council (including: corporate risks and pressures, capital financing items to cover interest payments for external borrowing, interest earned on cash balances, capital financing charges, inflation budgets, growth budgets for service pressures held centrally, levies, pension and redundancy costs) these were reasonably static (with the exception of recent changes in income from interest payments)

·         Funding moved both in and out of the reserves each financial year.

·         The anticipated net movement in the Council’s usable reserves in 2022-23 was expected to be £5m. The Council was in the process of closing the accounts – after which a clearer total could be provided.

·         More work was required to estimate the level of likely overspending in the dedicated school grant in the coming years.

·         Work had been commissioned by the Department for Education with Newton to work with councils to manage dedicated school grant deficits.

5.3  In Committee discussions – the following key point was also noted:

·         Members would welcome a further breakdown of funds held in the ‘corporate items’ budget in future reports.