1 - Revenue and Capital Budget Monitoring as at 11 November 2022
Renfrewshire Council · 22 February 2023
Back to Leadership Board — 22 February 2023 and its agenda
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To: Leadership Board On: 22 February 2023 Report by: Chief Executive, Director of Finance and Resources, and Chief Finance Officer Renfrewshire HSCP Heading: Revenue and Capital Budget Monitoring as at 11 November 2022 1. Summary of Financial Position 1.1. The projected revenue outturn at 31 March 2023 for those services reporting to the Leadership Board is an underspend position of £0.186m. 1.2. The projected capital outturn at 31 March 2023 for projects reporting to the Leadership Board is a breakeven position against the revised budget for the year. 1.3. This is summarised in the table below and further analysis is provided in the Appendices. Table 1: Revenue Division Revised Annual Budget £000 Projected Annual Outturn £000 Budget Variance (Adv)/Fav £000 Budget Variance % Adult Services 93,607 92,586 1,021 1.1% Chief Executives 20,363 21,198 (835) (4.1%) Total 113,970 113,784 186 0.2% Table 2: Capital Division Revised Annual Budget £000 Projected Annual Outturn £000 Budget Variance (Adv)/Fav £000 Budget Variance % Chief Executives 44,808 44,808 0 0% Leisure Services 2,386 2,386 0 0% Total 47,194 47,194 0 0%
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2. Recommendations 2.1. Members are requested to: (a) Note the projected Revenue outturn position detailed in Table 1 above; (b) Note the projected Capital outturn position detailed in Table 2 above; and (c) Note the budget adjustments detailed at sections 4 and 6. 3. Revenue 3.1. The Revenue Budget Monitoring report at Appendix 1 identifies a projected annual underspend of £0.186m (0.2% of total budget) for all services reporting to this Board. Detailed division reports can be found in Appendix 2, along with an explanation of each significant projected variance. 3.2. The projected outturn is based on information currently available, and assumptions made by service budget holders. 3.3. The main reasons for the projected outturn position are indicated in the appendices showing both the subjective analysis (what the budget is spent on) and the objective analysis (which division is spending the budget). 3.4. The most significant areas to bring to member’s attention are outlined below: • OneRen continues to experience increased cost and reduced revenue generation in the short to medium term as a result of both temporary and more permanent behavioural changes as the recovery from COVID progresses. In addition the level of pay award agreed for 2022/23 is in excess of the level of budgetary provision made, resulting in an increased forecast overspend. OneRen is also facing steeply increasing utilities costs which are currently being managed within existing resources through close financial management. The Board and management team of OneRen continue to put measures in place to mitigate the level of financial support required. • Within Adult Services, managed by Renfrewshire HSCP, the service continues to take significant action in response to the pandemic, including providing substantial levels of support to external care providers in order to ensure their ongoing financial sustainability. At Period 8, the service estimates that costs of £3.12m will be incurred specifically in relation to COVID-19 Adult Social Care services by the end of the financial year; this includes costs related to financial sustainability payments to private adult and elderly care providers. T
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The projected costs are however based on the current position and may change depending on any further impact of COVID on internal and externally provided services. The Scottish Government provided the HSCP with additional COVID- 19 funding in the final quarter of 2021/22, any uncommitted proportion of which will require to be returned to the Scottish Government over the course of 2022/23. This funding has been held as an earmarked reserve and will be utilised to fund COVID-19 costs incurred this financial year. In this context, additional costs specifically relating to the COVID-19 response are not therefore included within this report. The Scottish Government has confirmed additional funding for local government to partly offset the overall financial impact of the pay settlement on local government budgets. This additional funding has been provided to local government as general grant and therefore each individual Council is free to deploy these resources locally to reflect local financial requirements and priorities. In this context, and reflecting the projected year end underspend for Adult Services in 2022/23 as outlined in this report (which takes into account the full year impact of the pay uplift for all Council employees), and the significant in year projected overspend being reported by the Council, the IJB’s financial allocation from the Council is not at this stage expected to be adjusted in 2022/23 and the impact of the settled pay award will be managed within existing resources. 4. Revenue Budget Adjustments 4.1. Members are asked to note from Appendix 1 that minor budget adjustments have been processed since the previous report to board. 5. Capital 5.1. The Capital Investment Programme 2022/23 to 2026/27 was approved by the Council on 3 March 2022. 5.2. For the Chief Executives Service, the approved capital spend for 2022/23 is £44.808m (£44.981m approved Capital Plan). For Leisure Services, the approved capital spend for 2022/23 is £2.386m (£0.754m approved Capital Plan). 5.3. Further detail, including reasons for significant variances, can be found at Appendix 3.
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5.4. It is anticipated that due to both the impact of COVID-19 on the construction industry through constrained supply chain capacity for all major building materials, coupled with heightened demand across the globe as economies emerge from pandemic lockdowns, there will be increasing financial pressures and potential time impacts in several of the Council’s capital building projects. In this context and as previously reported, it is anticipated that consequential cost pressures arising from COVID-19 will require to be addressed from specific earmarked reserve balances. 6. Capital Budget Adjustments 6.1. Since the 2022/23 budget was approved in March, budget adjustments totalling £1.459m have arisen. Within Chief Executives, £6.015m of these adjustments have occurred since the previous board report as a result of: Budget carried forward into 2023/24 from 2022/23 (£6.015m) as result of updated cash flows: o Clyde Waterfront and Renfrew Riverside: (£5.353m); o AMIDS: South (£0.662m). ___________________________________________________________________ Implications of this report 1. Financial – The projected budget outturn position for the revenue budget reported to the Leadership Board is an underspend of £0.186m. Income and expenditure will continue to be monitored closely for the rest of the financial year and, where necessary, steps will be taken to mitigate any overspend. The projected outturn position for capital budgets reported to the Leadership Board is breakeven. The Capital programme will continue to be monitored closely for the rest of the financial year. Any changes to current projections in either Revenue or Capital budgets will be reported to the board as early as possible, along with an explanation for the movement. 2. HR and Organisational Development None directly arising from this report. 3. Community/Council Planning- None directly arising from this report.
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4. Legal None directly arising from this report. 5. Property/Assets Capital projects will result in new assets (City Deal) and refurbishment and improvement to Cultural Infrastructure and Public Realm assets. 6. Information Technology None directly arising from this report. 7. Equality and Human Rights The recommendations contained within this report have been assessed in relation to their impact on equalities and human rights. No negative impacts on equality groups or potential for infringement of individuals’ human rights have been identified arising from the recommendations contained in the report because for example it is for noting only. If required following implementation, the actual impact of the recommendations and the mitigating actions will be reviewed and monitored, and the results of the assessment will be published on the Council’s website. 8. Health and Safety None directly arising from this report. 9. Procurement None directly 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 None directly arising from this report. 12. Cosla Policy Position N/a. 13. Climate Risk None directly arising from this report. __________________________________________________________________ List of Background Papers The Capital Investment Programme 2022/23 to 2026/27 approved by the Council on 3 March 2022 __________________________________________________________________ Authors: Revenue - Valerie Howie, Finance Business Partner
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Capital - Geoff Borland, Finance Manager
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Appendix 1 Objective Summary Approved 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 Adult Services 93,607 0 93,607 92,586 1,021 1.1% 971 50 Chief Executive's Service 20,349 14 20,363 21,198 (835) (4.1%) (278) (557) NET EXPENDITURE 113,956 14 113,970 113,784 186 0.2% 693 (507) Subjective Summary Approved 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 42,065 2,046 44,111 43,429 682 1.5% (9,048) 9,730 Premises Related 815 0 815 868 (53) (6.5%) (112) 59 Transport Related 836 1 837 488 349 41.7% 383 (34) Supplies and Services 15,433 89 15,522 16,269 (747) (4.8%) (219) (528) Third Party Payments 76,307 139 76,446 77,173 (727) (1.0%) 472 (1,199) Transfer Payments 8,344 (1,914) 6,430 6,098 332 5.2% 90 242 Support Services 76 15 91 75 16 17.6% 3 13 Depreciation and Impairment Losses 0 0 0 0 0 0.0% 0 0 GROSS EXPENDITURE 143,876 376 144,252 144,400 (148) (0.1%) (8,431) 8,283 Income (29,920) (362) (30,282) (30,616) 334 1.1% 10,220 (9,886) NET EXPENDITURE 113,956 14 113,970 113,784 186 0.2% 1,789 (1,603) RENFREWSHIRE COUNCIL REVENUE BUDGET MONITORING STATEMENT 2022/23 1 April 2022 to 11 November 2022 Budget Variance (Adverse) or Favourable Budget Variance (Adverse) or Favourable POLICY BOARD : LEADERSHIP BOARD
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Appendix 2 Objective Summary Approved 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 Older People 60,563 (416) 60,147 60,993 (846) (1.4%) (521) (325) Physical or Sensory Difficulties 7,500 36 7,536 7,338 198 2.6% 87 111 Learning Difficulties 20,969 282 21,251 20,011 1,240 5.8% 1,149 91 Mental Health Needs 3,825 45 3,870 3,433 437 11.3% 255 182 Addiction Services 750 53 803 811 (8) (1.0%) 1 (9) NET EXPENDITURE 93,607 0 93,607 92,586 1,021 1.1% 971 50 Objective Heading Older People Physical or Sensory Difficulties Learning Difficulties Mental Health Needs Key Reasons for Projected Variance POLICY BOARD : LEADERSHIP BOARD - ADULT SERVICES Underspends in employee costs reflecting national recruitment issues facing all Health & Social Care. Underspends in employee costs reflecting national recruitment issues facing all Health & Social Care. Spend within care at home continues to increase as the service continues to support delayed discharges and demand. Underspends in employee costs reflecting national recruitment issues facing all Health & Social Care offset with the RENFREWSHIRE COUNCIL REVENUE BUDGET MONITORING STATEMENT 2022/23 1 April 2022 to 11 November 2022 Budget Variance (Adverse) or Favourable
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Appendix 2 Subjective Summary Approved 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 36,987 1,965 38,952 38,291 661 1.7% (1,016) 1,677 Premises Related 442 0 442 493 (51) (11.5%) (51) 0 Transport Related 835 1 836 487 349 41.7% 371 (22) Supplies and Services 2,131 89 2,220 2,100 120 5.4% 73 47 Third Party Payments 76,181 139 76,320 77,047 (727) (1.0%) (1,082) 355 Transfer Payments 6,112 (1,847) 4,265 3,933 332 7.8% 1,258 (926) Support Services 72 15 87 71 16 18.4% 3 13 Depreciation and Impairment Losses 0 0 0 0 0 0.0% 0 0 GROSS EXPENDITURE 122,760 362 123,122 122,422 700 0.6% (444) 1,144 Income (29,153) (362) (29,515) (29,836) 321 1.1% 1,415 (1,094) NET EXPENDITURE 93,607 0 93,607 92,586 1,021 1.1% 971 50 Budget Variance (Adverse) or Favourable 1 April 2022 to 11 November 2022 RENFREWSHIRE COUNCIL REVENUE BUDGET MONITORING STATEMENT 2022/23 POLICY BOARD : LEADERSHIP BOARD - ADULT SERVICES
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Appendix 2 Objective Summary Approved 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 Chief Executive and Management 268 31 299 296 3 1.0% 1 2 Policy and Commissioning 4,576 51 4,627 4,616 11 0.2% 42 (31) Marketing and Communications 3,771 (68) 3,703 3,694 9 0.2% 21 (12) City Deal & Infrastructure 0 0 0 0 0 0.0% 0 0 Leisure Services (incl Renfrewshire Leisure) 11,734 0 11,734 12,592 (858) (7.3%) (342) (516) NET EXPENDITURE 20,349 14 20,363 21,198 (835) (4.1%) (278) (557) Objective Heading Chief Executive and Management Policy and Commissioning Marketing and Communications City Deal & Infrastructure Leisure Services (incl Renfrewshire Leisure) Key Reasons for Projected Variance No significant projected year end variances to report. REVENUE BUDGET MONITORING STATEMENT 2022/23 Budget Variance (Adverse) or Favourable 1 April 2022 to 11 November 2022 RENFREWSHIRE COUNCIL POLICY BOARD : LEADERSHIP BOARD - CHIEF EXECUTIVE'S SERVICE No significant projected year end variances to report. The projected overspend position reflects the significant challenges OneRen continues to face following the pandemic and its impact on commercial income, in addition to the higher level of pay award now agreed for 2022/23. No significant projected year end variances to report. No significant projected year end variances to report.
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Appendix 2 Subjective Summary Approved 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 5,078 81 5,159 5,138 21 0.4% 72 (51) Premises Related 373 0 373 375 (2) (0.5%) (2) 0 Transport Related 1 0 1 1 0 0.0% 0 0 Supplies and Services 13,302 0 13,302 14,169 (867) (6.5%) (359) (508) Third Party Payments 126 0 126 126 0 0.0% 0 0 Transfer Payments 2,232 (67) 2,165 2,165 0 0.0% (2) 2 Support Services 4 0 4 4 0 0.0% 0 0 Depreciation and Impairment Losses 0 0 0 0 0 0.0% 0 0 GROSS EXPENDITURE 21,116 14 21,130 21,978 (848) (4.0%) (291) (557) Income (767) 0 (767) (780) 13 1.7% 13 0 NET EXPENDITURE 20,349 14 20,363 21,198 (835) (4.1%) (278) (557) Budget Variance (Adverse) or Favourable 1 April 2022 to 11 November 2022 POLICY BOARD : LEADERSHIP BOARD - CHIEF EXECUTIVE'S SERVICE RENFREWSHIRE COUNCIL REVENUE BUDGET MONITORING STATEMENT 2022/23
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Appendix 3 Prior Years Approved Budget Revised Projected Expenditure Budget Adjustments Budget Outturn Total Approved Projected Include prior Project to 31/03/2022* 2022-23 in 2022-23 2022-23 2022-23 Budget Outurn Project Title Code to 31-Mar-27 to 31-Mar-27 £000 £000 £000 £000 £000 £000 £000 LEISURE SERVICES Leisure Investment Programme y LGL01 52,279 0 321 321 321 0 0% 52,600 52,600 0 0% Grass Pitches & Changing Facilities y LU000GPTHCF 3,872 0 369 369 369 0 0% 4,241 4,241 0 0% Community Halls Refurbishment y LGL02CMMRFB 1,710 754 942 1,696 1,696 0 0% 3,433 3,433 0 0% Lagoon Internal Play Centre y LIPC 0 0 0 0 0 0 0% 1,000 1,000 0 0% Total Leisure Services 57,861 754 1,632 2,386 2,386 0 0% 61,274 61,274 0 0% CHIEF EXECUTIVES City Deal Projects Glasgow Airport Investment Area y DGD01GLARIA 38,662 2,314 1,934 4,248 4,248 0 0% 43,053 43,053 0 0% Clyde Waterfront & Renfrew Riverside y DGD01CWRERV 21,821 37,714 -8,908 28,806 28,806 0 0% 117,748 117,748 0 0% Airport Access y DGD01AIRACC 2,934 0 0 0 0 0 0% 141,991 141,991 0 0% Economic Development GAIA Regeneration y GAIA Regeneration 2,109 0 1,891 1,891 1,891 0 0% 5,500 5,500 0 0% AMIDS: Public Realm Phase 1 Netheron Square y DGD11AMID01 246 2,726 962 3,688 3,688 0 0% 3,933 3,933 0 0% AMIDS: District Heating Network y DGD11DISTHN 3,882 2,007 1,204 3,211 3,211 0 0% 7,093 7,093 0 0% AMIDS: South y AMIDSSouth 415 220 2,744 2,964 2,964 0 0% 42,328 42,328 0 0% Total Chief Executives 70,069 44,981 (173) 44,808 44,808 0 0% 361,646 361,646 0 0% TOTAL LEADERSHIP BOARD 127,930 45,735 1,459 47,194 47,194 0 0% 422,920 422,920 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 11th November 2022 POLICY BOARD: LEADERSHIP Current Year 2022-23 Full Programme - All years Budget Variance (Adverse) or Favourable Budget Variance (Adverse) or Favourable