Housing Revenue Account - 1 April to 22 July 22
North Lanarkshire Council · 31 August 2022
Back to Housing Committee — 31 August 2022 and its agenda
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North Lanarkshire Council Report Housing Committee Does this report require to be approved? ☐ Yes ☒ No Ref GT/AN Date 31/08/22 Revenue Monitoring Report – Housing Revenue Account From Derek Brown, Depute Chief Executive E-mail telferg@northlan.gov.uk Telephone Greg Telfer, Business Finance Manager, 07586 010692 1. Background 1.1 The Council approved its Housing Revenue Account Budget of £149m on 17 December 2021. 1.2 The Financial Regulations require Services to remain within their approved budgetary provision, and to report all significant deviations – defined as the higher of £100,000 or 5% - within their budget monitoring reports. Where significant deviations are identified, Services must provide explanatory commentary, outline the action required to rectify such a deviation, and where relevant, must also highlight the impact this has on other budget headings. Executive Summary This report provides a summary of the Housing Revenue Account financial performance for the period 1 April 2022 to 22 July 2022 (Period 4). The report illustrates the projected outturn as at 31 March 2023, with major outturn variances highlighted and explained in accordance with the Council’s approved Financial Regulations. The service is currently projecting a breakeven position for the financial year. It is presently anticipated that £1.849m of savings (100%) will be delivered by the financial year-end. Recommendations It is recommended that Committee: 1) Acknowledges the financial position of the HRA revenue budget 2022/23. The Plan for North Lanarkshire Priority Improve North Lanarkshire's resource base Ambition statement (25) Ensure intelligent use of data and information to support fully evidence based decision making and future planning
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2. Report 2.1 Summary of Financial Position 2.1.1 The service is currently projecting a breakeven position for the financial year. 2.2 Analysis of Significant Variances 2.2.1 There are currently no significant variances projected within the Housing Revenue Account. 2.2.2 The projected outturn is currently being monitored to assess a number of risks associated with the current economic climate surrounding inflation and the cost of living crisis. This is likely to have a particularly significant impact on areas such as the cost of housing repairs and the impact and potential management action is currently being assessed by the Service. 2.3 Earmarked and One-off Resources 2.3.1 An update of the earmarked reserves is detailed in Appendix 2 2.3.2 When account is taken of the £1.470m core reserve, and other previously earmarked reserves totalling £12.871m as detailed in Appendix 2, the remaining unallocated resources total to £5.155m. 2.4 2022/23 Budget Savings 2.4.1 The service uses a variety of information, records and processes to monitor achievement of its approved budget savings of £1.849m. As at Period 4, it anticipates 100% of its approved savings will be delivered by the financial year-end. 3. Measures of success 3.1 Service is currently operating within approved budgeted constraints and meeting required savings targets. 4. Supporting documentation 4.1 Appendix 1 HRA Summary Appendix 2 Earmarked Reserves / Balance Sheet Provisions Derek Brown Depute Chief Executive
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5. Impacts ( http://connect/report-template-guidance ) 5.1 Public Sector Equality Duty and Fairer Scotland Duty Does the report contain information that has an impact as a result of the Public Sector Equality Duty and/or Fairer Scotland Duty? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? If Yes, has an assessment been carried out and published on the council’s website? https://www.northlanarkshire.gov.uk/your-community/equalities/equality-and-fairer- scotland-duty-impact-assessments Yes ☐ No ☐ 5.2 Financial impact Does the report contain any financial impacts? Yes ☒ No ☐ If Yes, have all relevant financial impacts have been discussed and agreed with Financial Solutions? Yes ☒ No ☐ If Yes, please provide a brief summary of the impact? The financial impacts are contained within the report and supporting appendices. 5.3 HR policy impact Does the report contain any HR policy or procedure impacts? Yes ☐ No ☒ If Yes, have all relevant HR impacts have been discussed and agreed with People and Organisational Development? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.4 Legal impact Does the report contain any legal impacts (such as general legal matters, statutory considerations (including employment law considerations), or new legislation)? Yes ☐ No ☒ If Yes, have all relevant legal impacts have been discussed and agreed with Legal and Democratic Solutions? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.5 Data protection impact Does the report / project / practice contain or involve the processing of personal data? Yes ☐ No ☒ If Yes, is the processing of this personal data likely to result in a high risk to the data subject? Yes ☐ No ☐ If Yes, has a Data Protection Impact Assessment (DPIA) been carried out and e- mailed to dataprotection@northlan.gov.uk Yes ☐ No ☐ 5.6 Technology / Digital impact Does the report contain information that has an impact on either technology, digital transformation, service redesign / business change processes, data management, or connectivity / broadband / Wi-Fi? Yes ☐ No ☒
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If Yes, please provide a brief summary of the impact? Where the impact identifies a requirement for technology, has an assessment been carried out (or scheduled) by the Enterprise Architecture Governance Group (EAGG)? Yes ☐ No ☐ 5.7 Environmental / Carbon impact Does the report / project / practice contain information that has an impact on any environmental or carbon matters? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.8 Communications impact Does the report contain any information that has an impact on the council’s communications activities? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.9 Risk impact Is there a risk impact? Yes ☒ No ☐ If Yes, please provide a brief summary of the key risks and potential impacts, highlighting where the risk(s) are assessed and recorded (e.g. Corporate or Service or Project Risk Registers), and how they are managed? All activities undertaken by the council are subject to risk, and in acknowledging the Council’s approved Risk Management Strategy (September 2012), Services manage these as part of their overall corporate and service planning process. The current economic climate, in particular, has the potential to impact upon the Council’s ability to provide quality services within approved budget levels. Reflecting the risk analysis matrix included within the Risk Management Strategy, the Service considers the impact of inflation on key service contracts and the cost of living crisis presents an ongoing risk to the financial outturn for 2022/23 and this is an ongoing focus of discussion within the Service and with Financial Solutions. To minimise risk, this report has been prepared by service-based Financial Solutions personnel in consultation with budget managers, in accordance with the Financial Regulations
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Appendix 1 FINANCIAL MONITORING REPORT DIVISION : HRA SUMMARY 01 April 2021 to 22 JULY 2021 (Period 4) Cost Centre: HRA [H] COMMITTEE: HOUSING CATEGORY BUDGET ACTUAL YEAR TO DATE ANNUAL PROJECTED ANALYSIS TO DATE TO DATE VARIANCE BUDGET OUTTURN (1) (2) (3) (4) (5) (6) (10) £ £ £ £ £ EMPLOYEE COSTS 7,086,598 7,047,985 38,613 FAV 28,487,350 28,487,350 0 - Balanced Budget PROPERTY COSTS 13,399,111 13,454,139 (55,028) ADV 54,323,690 54,323,690 0 - Balanced Budget SUPPLIES & SERVICES 296,174 249,031 47,143 FAV 1,182,400 1,182,400 0 - Balanced Budget TRANSPORT & PLANT 106,066 83,960 22,106 FAV 367,140 367,140 0 - Balanced Budget ADMINISTRATION COSTS 262,236 236,417 25,819 FAV 5,490,900 5,490,900 0 - Balanced Budget PAYMENTS TO OTHER BODIES 15,106 20,433 (5,327) ADV 231,120 231,120 0 - Balanced Budget APPORTIONED EXPENSES 0 0 0 - 6,229,960 6,229,960 0 - Balanced Budget CAPITAL FINANCING COSTS 0 0 0 - 22,408,280 22,408,280 0 - Balanced Budget C.F.C.R. 0 0 0 - 27,146,260 27,146,260 0 - Balanced budget OTHER COSTS 0 1,650 (1,650) ADV 3,584,160 3,584,160 0 - Balanced budget TOTAL EXPENDITURE 21,165,291 21,093,615 71,676 FAV 149,451,260 149,451,260 0 - OTHER GRANTS 0 0 0 - 0 0 0 - Balanced budget FEES AND CHARGES 151,295 188,006 36,711 FAV 7,692,710 7,692,710 0 - Balanced Budget RENTS 35,132,213 35,155,561 23,348 FAV 141,743,460 141,743,460 0 - Balanced Budget INTEREST 0 0 0 - 15,000 15,000 0 - Balanced Budget DEPARTMENTAL CHARGES 0 0 0 - 90 90 0 - Balanced Budget SURPLUS 0 0 0 - 0 0 0 - Balanced Budget INCOME 35,283,508 35,343,567 60,059 FAV 149,451,260 149,451,260 0 - NET EXPENDITURE (14,118,217) (14,249,952) 131,735 FAV 0 0 0 - FAV = Favourable variation, underspend etc 362,119 ADV = Adverse variation, overspend, income under-recovery etc PROJECTED OUTTURN VARIANCE (7)
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Appendix 2 DESCRIPTION OF EARMARKED RESERVES VALUE OF EARMARKED RESERVE CARRY FORWARD ANALYSIS VALUE % (1) (2) (3) (4) (5) (6) £ £ £ Ambition 5,054,483 0 100.0% 5,054,483 Balance required in future years Welfare Reform 259,869 0 100.0% 259,869 Utilisation of balance to be considered UCAF 572,633 162,191 71.7% 410,442 Utilisation of balance to be considered Hardship Fund 747,660 556,275 25.6% 191,385 Balance required in 2023/24 Enterprise Contract 670,793 670,793 0.0% 0 Budget fully utilised Rent Restructure 565,469 230,883 59.2% 334,586 Balance required in future years Housing Repairs 2,500,000 0 100.0% 2,500,000 To fund future repairs programme HRA Capital Programme 2,500,000 0 100.0% 2,500,000 To fund future programme SUB TOTAL 12,870,907 1,620,142 87.4% 11,250,765 Change Management/Risks & Uncertainty 5,154,712 0 0.0% 5,154,712 Available for future allocation Core Reserve 1,470,000 0 100.0% 1,470,000 No call anticipated in 2021/22 TOTAL 19,495,619 1,620,142 91.7% 17,875,477 PROJECTED OUTTURN North Lanarkshire Council Housing Revenue Account - Earmarked Reserves 01 April 2021 to 22 JULY 2021 (Period 4)