To consider progress in the Council’s performance for the fourth quarter 2020/21 including KPIs and Provisional Budget Outturn Report Q4 2020/21, and to make any observations to the Executive.
The Committee received reports giving an overview of the Council’s performance for Quarter 4 2020/21, including Key Performance Indicator (KPI) reporting, as well as revenue and capital budget monitoring. The reports were due to go to Executive on 24 June.
Cllr V. Lewanski, Portfolio Holder for Corporate Policy and Resources, outlined the report to Members and reported that of the 12 KPIs that are reported on in Quarter 4, all were on target or within the agreed tolerance.
Members made comments and observations on the following areas and noted that there were five Amber ratings:
Homelessness – KPI 5 – the % of positive homelessness prevention and relief outcomes – showed a decrease compared to Quarter 3. However, overall, the Borough expected to see an increase in the number of positive outcomes in this area by the end of the year as those that approached the Council in Quarter 4 were supported by the Council’s Housing team. The Committee asked for an update from the new Portfolio Holder for Housing & Support outside the meeting including what the Council was doing differently in the future to improve performance.
Fraud – Members were surprised by the high number of referrals from the National Fraud Initiative because of data matching of various government systems throwing up possible anomalies for investigation, rather than whistle-blowing notifications from the public. These figures were set out in the annual contextual target. This showed the number of fraudulent claims (148) for Single Person households claiming a discount on their Council Tax even though they were sharing a property. The Acting Head of Paid Service confirmed that robust action is taken against individuals making fraudulent claims.
Affordable housing completions – Members asked for a written answer giving a breakdown of the different types of definition included in affordable housing.
Cllr T. Schofield, Deputy Leader and Portfolio Holder for Finance and Governance, gave an overview of the financial reports for Quarter 4 2020/21. Due to COVID-19 it has been a challenging year with significant additional financial impacts that had been faced on Service income and expenditure budgets and on Collection Fund income forecasts for council tax and business rates. As at 31 March, the full year outturn was £17.852m against a management budget of £16.010m resulting in an overspend of £1.841m (11.5%). The primary reason for this overspend was that it included income losses as a result of the COVID-19 pandemic. The Central budget outturn at 31 March was £6.935m against a management budget of £9.702m resulting in an underspend of £2.767m (28.52%). This underspend was due to an underspend in Treasury Management and a forecast underspend in Budget Contingencies.
It was noted that the impacts of the pandemic on the budget had been monitored closely with every possible source of funding pursued, resulting in a position of relative strength. The unplanned expenditure on the Covid pandemic was £3.782m, offset by Covid funding of £7.735m, producing a Covid-related balance of £3.953m, which included government funding to offset the income losses in the Service budgets. There was capacity to carry funds forward for a new earmarked reserve for Covid costs and reserves remained strong. It was noted that written responses to Advance Questions put forward by Members had been circulated.
Members made comments and observations on the following areas:
Fees and charges review – Members asked if there was consideration of increasing fees for dealing with planning applications as these had risen during the year and the fees did not always compensate the work that officers have had to do. It was confirmed that a thorough review of fees and charges across the Council would be part of the budget-setting process for 2022/23.
Feasibility studies – the details and outcomes of the spending on Feasibility Studies (Commercial Ventures) Reserve such as PV Solar Feasibility and CIPFA consultancy set out in the report were questioned. The Interim Head of Finance said that the Community Benefit Society feasibility study costs was part of the commercial work carried out to develop the Council’s company structures. The CIPFA consultancy was to give advice on the criteria around rules on local government borrowing. Members asked for more detail on what improvements came out of some of the feasibility studies such as solar panels and housing developments. Further details would be provided outside the meeting.
Refuse and recycling – the spend on older vehicles was discussed. It was noted that the new replacement vehicles were purchased to help cut emissions and fumes, however, one impact of COVID-19 was the significant increase in the tons of waste and recycling due to residents working from home in the past year; this has meant that some of the older vehicles have had to be retained for longer than originally planned.
Budget outturn variances – the detail on the budget variances reported included the variances in the Place delivery budget. Further details would be supplied in a written response from the Interim Head of Finance. The differences between the management budget and the original budget were discussed.
Collection Fund – Members noted the written response to an advance question on the Collection Fund and asked about the impact of revenue losses and how this could impact revenue budgets over the next three years. It was confirmed that this was set out in the response with deficit recovery being spread over three years.
COVID-19 grants – it was identified that there were unspent COVID-19 grants at 31 March. Following the announcement that lockdown is to be extended, the deadline for paying grants has been put back a month and a communications campaign was ongoing to reach those businesses who had not yet claimed these grants.
ICT – it was noted that there had been substantial savings in ICT due to changed priorities because of the COVID-19 response. Several budgeted projects such as new Contact Centre Telephony and Harlequin ICT upgrade had to be delayed. However, other new projects were given a high priority such as introduction of remote access for staff and supporting remote Councillor meetings, but these were lower cost projects. Members asked if the move to more hybrid working would necessitate more expenditure at the same time as catching up with the delayed projects, resulting in extra costs in the current financial year. The Interim Head of Paid Service said a programme of work was looking at the Council’s hybrid working capability as well as projects such as cybersecurity and disaster recovery. This work will be shared with Members when it became available.
Implications for 2021/22 – it was noted that no significant areas of concern had been identified so far with budget monitoring this year. The first quarterly budget monitoring report for 2021/22 will be presented to the Committee in September.
Reserves – Members queried the number of Reserve funds that had been set up, but Executive Members confirmed this was a conscious decision to create specific reserves for particular areas of risk. This was considered good practice rather than holding funds in a single general reserve.
Commercial investment – it was noted that this budget included the cost of buying land at the Reading Arch Road, Redhill site. Members requested, for the future, greater clarity in the layout of the reporting of commercial investments in Annex 2, section 2.
Loss of income from charges – Members welcomed the summary giving the income losses and revenue lost or recovered as set out in the Advance Questions responses.
RESOLVED that the Committee:
1) Notes the Key Performance Indicator performance for Q4 2020/21 as detailed in the report and Annex 1 and makes observations to the Executive as set out in the Minutes;
2) Notes the Revenue Budget outturn for 2020/21 and recommended budget carry-forwards as detailed in the report and at Annex 2 and makes observations to the Executive as set out in the Minutes;
3) Notes the Capital Programme outturn for 2020/21 as detailed in the report and at Annex 3 and makes observations to the Executive as set out in the Minutes;
4) Notes the forecast year-end Revenue Reserves position; including the new Reserves that have been established to manage COVID-19 funds.