ILE Revenue and Capital Budget Monitoring 202425 at 8 November 2024
Renfrewshire Council · 22 January 2025
Back to Infrastructure, Land and Environment Policy Board — 22 January 2025 and its agenda
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___________________________________________________________________ To: Infrastructure, Land & Environment Policy Board On: 22 January 2025 ___________________________________________________________________ Report by: Director of Finance and Resources Director of Environment, Housing & Infrastructure ___________________________________________________________________ Heading: Revenue and Capital Budget Monitoring 2024/25 at 8 November 2024 ___________________________________________________________________ 1. Summary 1.1 At the close of reporting Period 8 on 8 September 2024, the projected revenue outturn at 31 March 2025 for those services reporting to the Infrastructure, Land and Environment Policy Board is an overspend position of £1.160m (4.1%) against the revised budget for the year. 1.2 The projected capital outturn at 31 March 2025 for projects reporting to the Infrastructure, Land and Environment Policy Board is a break-even position. 1.3 This is summarised over the relevant services in the table below and further analysis is provided in the report and appendices. Revised Annual Budget £000 Projected Outturn £000 Budget Variance (Adv)/Fav £000 Budget Variance % Revenue Director of Environment, Housing & Infrastructure 32,121 33,281 (1,160) (4.1%) Total 32,121 33,281 (1,160) (4.1%) Capital Environment & Infrastructure 18,684 18,684 0 0.0%
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2. Recommendations 2.1 It is recommended that the Infrastructure, Land and Environment Policy Board: a) Note the projected Revenue outturn overspend position of £1.160m; b) Note the projected Capital outturn break-even position. 3. Revenue Budget Projection – overspend of £1.160m by 31 March 2025 3.1 The tables in Appendix 1 and 2 present the projected year-end position for all services reporting to this board, by both objective analysis (which division is spending the budget – appendix 1) and subjective analysis (what the budget is spent on – appendix 2). Significant variances affecting the projected position are analysed further below. 3.2 It should be noted that the projected outturn position reported here is based on the latest information available, which is subject to change during the financial year. The impact of any change on this projection will be updated at each board cycle until the close of reporting Period 10. Budget holders are obliged to seek mitigating action to minimise significant budget variances. 4. Objective Analysis – Significant Variances 4.1 Environment, Housing and Infrastructure – (£1.160m) projected overspend Waste Services – (£1.112m) overspend by 31 March 2025 This reflects the financial position for Refuse Collection, Refuse Disposal and Household Waste Recycling Centres. The overspend for Refuse Collection in the main relates to an under-recovery of income (£360k), which includes an estimated under-recovery of income relating to trade waste equating to £256k. As previously reported, commercial waste customer volumes have reduced over the last few years due to a number of factors. The service is currently reviewing the opportunities to reduce costs attributable to the collection and disposal of trade waste to better align with customer numbers and tonnages collected.
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It is also anticipated that there will be a projected overspend in employee costs (£0.333m) as a result of agency staff and overtime being required to cover absence and vacancies, in addition to a projected overspend in transport costs (£0.115m) as a result of non-fair wear and tear costs being higher than budgeted. The reported overspend also includes the increased costs related to the purchase of bins resulting in a projected overspend of £0.101m. Similar to other areas within the services, the impact of inflationary increases for goods and services remains a contributing factor to the overspend currently projected for this service area. It should be noted that Refuse Disposal has seen a reduced level of tonnages being disposed of as a result of the reduction in the customer base and this has been reflected in the projected outturn. The associated under recovery was reported to the board in period 6. The reported overspend within Refuse Disposal, in the main reflects the increase in the POPs/WUDs costs. It was estimated that the annual net spend for this area was £495k but recent activity indicates that the projected net spend is expected to be £664k resulting in an overspend of £169k. Neighbourhood Services - £0.091m underspend by 31 March 2025 The current projected underspend for Neighbourhood Services has decreased from £0.299m to £0.091m since the previous board. Seasonal staff extensions have increased employee costs by £0.090m. The remaining movement relates to an increase in cost for weed killer and a reduction in the anticipated income streams. Due to the reactive nature of the service, the income projections will continue to be closely monitored throughout the financial year. Fleet Services – £0.022m over recovery by 31 March 2025 The current anticipated over recovery forecast in Fleet Services reflects an agreed budget adjustment from central finance to mitigate the inflationary pressures on material and contractor costs that the service has faced over the last number of months. However, due to the significant cost increases, the service level agreements require to be reviewed to ensure operational services are charged appropriately to cover costs. In addition, the income projection has been amended to reflect an under-recovery of recharge income as a result of some services returning / disposing of some of their aging fleet. These services will therefore no longer be recharged for fair wear and tear related costs.
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Social Transport – (£0.276) overspend by 31 March 2025 The two main areas of this projected overspend relate to employee costs (£0.144m) and external vehicle hire (£0.129m). At present, there has been a requirement to recruit agency staff due to sickness and vacancies and due to the ageing fleet within the Social Transport service, this has resulted in a significant increase in reliance of external vehicle hires to support the service. 5. Subjective Analysis – Significant Variances 5.1 Premises Related – (£0.157) overspend by 31 March 2025 The overspend primarily relates to the anticipated overspend for the purchase of bins (£0.101m), as mentioned above in 4.1. In addition, the costs relating to solid fuel for biomass within the depot at Underwood Road are projecting an overspend of £0.029m. 5.2 Transport Related – (£0.708m) overspend by 31 March 2025 The projected overspend has significantly decreased since the last reporting period as a result of the £1.5m realignment virement, approved at the Period 6 board, being processed. The current projected overspend (9.4%) is due to the significant increase in the cost of replacement parts for vehicles, vehicle hire to cover service requirements due to the use of specialist contractors and also the disposal of some of the aging fleet. 5.3 Supplies and Services – (£1.226m) overspend by 31 March 2025 This projected overspend predominantly sits within Roads (£0.723m) which relates to work by contractor and bitumen costs, which are incurred to undertake capital works. These additional costs are offset by the resulting additional capital income the Service receives for carrying out these works. Any overspend in this area is effectively offset by an over-recovery of income. 5.4 Income – £0.934m over recovery by 31 March 2025 – P6 (£1.992m) As highlighted in paragraph 5.3, following the adoption of the accurate accounting treatment of recharges, the £1.5m realignment virement approved at the last board has now been processed. The current projected over-recovery relates to the following:-
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• recharge income within Roads operations (£0.667m), • increased income within Refuse Disposal for special uplifts (£0.145m) and • increased income within Fleet Services for the charges relating to external vehicle hire and non-fair wear and tear (£0.315m). The income over-recovery highlighted above is predominately offset by an anticipated under-recovery for trade waste income, as mentioned in note 4.1. Revenue Budget Virements 6.1 Under the Council’s financial regulations, Directors and their nominated officers, in consultation with the Director of Finance and Resources, have certain delegated authority to transfer sums between subjective budget headings within a service division to enable budget management throughout the financial year. This is known as ‘budget virement’. 6.2 Transfers between divisions of the same service / department in excess of £100,000, and transfers between services / departments must be authorised by the respective service Director and the Director of Finance and Resources for submission to the relevant policy board for approval. 6.3 Budget holders are obliged to seek mitigating action to minimise significant budget variances. There are no such virements this period. 7. Capital Budget Projection – break-even position by 31 March 2025 7.1 The Capital Investment Programme 2024/25 to 2028/29 was approved by the Council on 29 February 2024. For Infrastructure Land & Environment the revised capital spend for 2024/25 is forecast as £18.684m 7.2 The in-year Capital budget is forecast to break even by 31 March 2025 however, this will be monitored as the projects progress. Further details of the programme can be found in the Capital Monitoring report at Appendix 3.
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7.3 A number of budget adjustments between years have taken place, to reflect revised programming of some capital projects. Details of these adjustments, which amount to £0.167m, are as follows: Capital Budget Adjustments Project Amount (£m) Reason Active Travel 0.028 Budget transferred from Lifecycle Capital Maintenance Fund for a contribution towards Erskine Waterfront Path. Active Travel Transformational Fund (0.293) Budget decrease to reflect grant award for 2024/25. Multi-Purpose Bins 0.025 Budget increase to reflect funding approved by Council on 29 February 2024. Renewal of Play Parks (0.350) Deceleration from 2024/25 into 2025/26 to reflect anticipated cash flows. Recycling Improvement Fund 0.757 Budget increase to reflect grant award from Zero Waste Scotland. Total 0.167 Implications of the Report 1. Financial The projected budget outturn position for the Infrastructure, Land and Environment Revenue budget is an overspend of £1.160m. Income and expenditure will continue to be monitored closely for the rest of the financial year and as far as possible, steps will be taken by budget holders to mitigate any overspend. The projected outturn position for the Infrastructure, Land and Environment Capital budget is a break-even position. 2. HR & Organisational Development While staffing budgets form a significant proportion of the Council’s revenue budgets, there are no direct implications arising from the recommendations in this report.
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3. Community/Council Planning Community Plan Our Renfrewshire is thriving The Council’s revenue and capital spend ensures that its facilities are fit for purpose and safe for the community, to maximise accessibility. Our Renfrewshire is well Our Renfrewshire is fair Our Renfrewshire is safe Council Plan Reshaping our place, our economy and our future The Council’s revenue and capital spend ensures that its facilities are fit for purpose and safe for the community, to maximise accessibility. Building strong, safe and resilient communities Tackling inequality, ensuring opportunities for all Creating a sustainable Renfrewshire for all to enjoy Ongoing revenue and capital budget monitoring is a tool to enable good financial management so that the Council has resources now and in the future for continued service delivery. Working together to improve outcomes 4. Legal There are no direct implications arising from the recommendations in this report. 5. Property/Assets The capital expenditure noted in this report will result in lifecycle maintenance improvements to existing properties and replacement of ICT assets and infrastructure. 6. Information Technology There are no direct implications arising from the recommendations in this report. 7. Equality & Human Rights There are no direct implications arising from the recommendations in this report. 8. Health & Safety There are no direct implications arising from the recommendations in this report.
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9. Procurement While Procurement is an important consideration prior to the council incurring any revenue or capital spend, there are no direct implications arising from this report. 10. Risk The potential risk that the Council will overspend its approved budgets for the year will be managed at a Council-wide level by the Chief Executive and Directors. 11. Privacy Impact There are no direct implications arising from the recommendations in this report. 12. Cosla Policy Position N/A 13. Childrens Rights There are no direct implications arising from the recommendations in this report. 14. Climate Change The Council aims to reduce its carbon and other emissions to net zero by 2030, however there are no direct implications arising from the recommendations in this report. List of Background Papers • The Capital Investment Programme 2024/25 to 2028/29, Council 28 February 2024 Author: Lisa Dickie, Finance Business Partner, Gordon McNeil, Director of Environment, Housing & Infrastructure and Geoff Borland, Finance Manager (Capital)
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Appendix 1 Objective Summary Annual Budget at Period 6 Budget Adjustments Revised Annual Budget at Period 8 Projected Outturn Previous Projected Outturn Variance Movement £000 £000 £000 £000 £000 % £000 £000 Directorate and Service Development 1,295 0 1,295 1,241 54 4.2% 9 45 Refuse Collection 4,848 310 5,158 6,107 (949) (18.4%) (1,160) 211 Household Waste Recycling Centres 1,018 0 1,018 1,017 1 0.1% 42 (41) Refuse Disposal 7,544 261 7,805 7,969 (164) (2.1%) 50 (214) Neighbourhood Services 6,272 0 6,272 6,181 91 1.5% 299 (208) Fleet Services (258) 230 (28) (50) 22 78.6% (233) 255 Social Transport 1,127 0 1,127 1,403 (276) (24.5%) (293) 17 Roads Operations 3,383 0 3,383 3,346 37 1.1% 39 (2) Infrastructure and Assets 1,580 248 1,828 1,908 (80) (4.4%) (36) (44) Transportation & Active Travel 788 10 798 768 30 3.8% 39 (9) Parking of Vehicles (682) (10) (692) (728) 36 5.2% 59 (23) Street Lighting Maintenance Work 520 0 520 434 86 16.5% 23 63 Energy Management Unit 372 0 372 372 0 0.0% 0 0 Strathclyde Partnership for Transport Requisition 3,265 0 3,265 3,313 (48) (1.5%) (48) 0 NET EXPENDITURE 31,072 1,049 32,121 33,281 (1,160) (3.6%) (1,210) 50 Budget Variance (Adverse) or Favourable RENFREWSHIRE COUNCIL REVENUE BUDGET MONITORING STATEMENT 2024/25 1 April 2024 to 8 November 2024 POLICY BOARD : INFRASTRUCTURE, LAND AND ENVIRONMENT
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Appendix 2 Subjective Summary Annual Budget at Period 6 Budget Adjustments Revised Annual Budget at Period 8 Projected Outturn Previous Projected Outturn Variance Movement £000 £000 £000 £000 £000 % £000 £000 Employees 22,661 761 23,422 23,455 (33) (0.1%) (70) 37 Premises Related 1,225 0 1,225 1,382 (157) (12.8%) (48) (109) Transport Related 5,999 1,684 7,683 8,241 (558) (7.3%) (2,142) 1,584 Supplies and Services 13,384 (141) 13,243 14,469 (1,226) (9.3%) (859) (367) Third Party Payments 3,298 0 3,298 3,318 (20) (0.6%) (20) 0 Transfer Payments 150 10 160 210 (50) (31.3%) (16) (34) Support Services 714 0 714 764 (50) (7.0%) (47) (3) Depreciation and Impairment Losses 0 0 0 0 0.0% 0 0 GROSS EXPENDITURE 47,431 2,314 49,745 51,839 (2,094) (4.2%) (3,202) 1,108 Income (16,359) (1,265) (17,624) (18,558) 934 5.3% 1,992 (1,058) NET EXPENDITURE 31,072 1,049 32,121 33,281 (1,160) (3.6%) (1,210) 50 POLICY BOARD : INFRASTRUCTURE, LAND AND ENVIRONMENT Budget Variance (Adverse) or Favourable RENFREWSHIRE COUNCIL REVENUE BUDGET MONITORING STATEMENT 2024/25 1 April 2024 to 8 November 2024
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Appendix 3 Prior Years Approved Budget Revised Projected Expenditure Budget Adjustments Budget Outturn Total Approved Projected to 31/03/2024 2024-25 since previous 2024-25 2024-25 Budget Outurn Project Title to 31-Mar-27 to 31-Mar-27 £000 £000 £000 £000 £000 £000 £000 ENVIRONMENT & INFRASTRUCTURE Active Travel Funding Tier 1 0 1,305 28 1,333 1,333 0 0% 4,533 4,533 0 0% LADA 0 49 0 49 49 0 0% 49 49 0 0% Roads/Footways Upgrade Programme 0 7,742 0 7,742 7,742 0 0% 24,142 24,142 0 0% Vehicle Replacement Programme 0 3,482 0 3,482 3,482 0 0% 11,582 11,582 0 0% Bridge Assessment/Strengthening 0 321 0 321 321 0 0% 1,320 1,320 0 0% Lighting Columns Replacement 0 1,410 0 1,410 1,410 0 0% 3,410 3,410 0 0% Traffic Management 0 274 0 274 274 0 0% 274 274 0 0% Parks Improvement Programme 1,173 31 0 31 31 0 0% 1,204 1,204 0 0% Improvements to Outdoor Access and Play Area Programm 353 116 0 116 116 0 0% 470 470 0 0% Active Travel Transformation Fund 319 921 (293) 628 628 0 0% 947 947 0 0% SPT - People in Place Fund 0 72 0 72 72 0 0% 72 72 0 0% Flooding 0 205 0 205 205 0 0% 205 205 0 0% Multi Purpose Bins 60 110 25 135 135 0 0% 195 195 0 0% Road Safety 681 272 0 272 272 0 0% 953 953 0 0% Renewal of Play Parks 238 1,038 (350) 688 688 0 0% 2,093 2,093 0 0% Parks - Multi Use Games Area 104 7 0 7 7 0 0% 112 112 0 0% Nature Restoration Fund 377 391 0 391 391 0 0% 908 908 0 0% Lawn Tennis Association 295 56 0 56 56 0 0% 350 350 0 0% Recycling Improvement Fund 374 250 0 250 250 0 0% 374 374 0 0% Public Realm - Paisley Abbey 0 300 0 300 300 0 0% 300 300 0 0% Recycling Improvement Fund 0 0 757 757 757 0 0% 757 757 0 0% Strathclyde Partnership Transport 0 165 0 165 165 0 0% 165 165 0 0% TOTAL INFRASTRUCTURE, LAND & ENVIRONMENT BOARD 4,137 18,517 167 18,684 18,684 0 0% 54,578 54,578 0 0% *Rolling programmes have a prior year year expenditure of £0 as the expenditure is not directly linked from one year to the next as a singular project. RENFREWSHIRE COUNCIL CAPITAL INVESTMENT STRATEGY - NON-HOUSING SERVICES 1st April to 8th November 2024 POLICY BOARD: INFRASTRUCURE, LAND & ENVIRONMENT Current Year 2024-25 Full Programme - All years Budget Variance (Adverse) or Favourable Budget Variance (Adverse) or Favourable