Item 10 Appendix 3 - HRA Budgetary Control Report to 31 March 2024 - Revenue
West Dunbartonshire Council · 28 August 2024
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WEST DUNBARTONSHIRE COUNCIL APPENDIX 3 HRA REVENUE BUDGETARY CONTROL 2023/24 PERIOD END DATE Subjective Summary Total Budget 2023/24 £000 Spend to Date 2023/24 £000 Forecast 2023/24 £000 Annual RAG Status Employee Costs 7,669 8,037 8,037 368 5% Property Costs 2,377 2,518 2,518 141 6% Transport Costs 142 153 153 11 0% Supplies, Services And Admin 389 408 408 19 5% Support Services 2,720 2,766 2,766 46 2% Other Expenditure 534 801 801 267 50% Repairs & Maintenance 16,257 15,063 15,063 (1,194) -7% Bad Debt Provision 1,089 1,094 1,094 5 0% Void Loss (Council Tax/Lost Rents) 1,261 1,518 1,518 257 20% Loan Charges 15,476 19,422 19,422 3,946 25% CFCR 1,729 0 0 (1,729) -100% Total Expenditure 49,643 51,780 51,780 2,137 4% House Rents (47,728) (47,954) (47,954) (226) 0% Lockup Rents (217) (211) (211) 6 -3% Factoring/Insurance Charges (1,434) (1,499) (1,499) (65) 5% Other rents (117) (121) (121) (4) 3% Interest on Revenue Balance (30) (199) (199) (169) 563% Miscellaneous income (117) (130) (130) (13) 11% Transfer from / to Reserves 0 (1,666) (1,666) (1,666) 0% Total Income (49,643) (51,780) (51,780) (2,137) 4% Net Expenditure 0 0 0 0 31 March 2024 Forecast Variance 2023/24 £000 %
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WEST DUNBARTONSHIRE COUNCIL APPENDIX 3 HRA REVENUE BUDGETARY CONTROL 2023/24 ANALYSIS FOR VARIANCES OVER £50,000 MONTH END DATE 31 March 2024 PERIOD 12 Budget Forecast Spend RAG Status £000 £000 £000 % Employee Costs 7,669 8,037 368 5% Main Issues Mitigating Action Anticipated Outcome Budget Forecast Spend RAG Status £000 £000 £000 % Property Costs 2,377 2,518 141 6% Main Issues Mitigating Action Anticipated Outcome Budget Forecast Spend RAG Status £000 £000 £000 % Other Expenditure 534 801 267 50% Main Issues Mitigating Action Anticipated Outcome This budget covers rent abatements, payments to the Womens Aid service, legal expenses and other sundry costs. Variance Narrative The overspend is due to higher rent abatement payments this year due to challenges in Building Services addressing the backlog of voids and repairs alongside complex meter related issues preventing tenants being able to return to their homes. The abatement overspend was partly offset by underspends in legal and banking costs. A year end overspend. Budget Details Variance Analysis Subjective Analysis forecast Variance Subjective Description Property costs overspend mainly due to increased electricity costs advised through the electricity national framework agreement after the budget was set. In addition, insurance costs exceeded budget reflecting the high rate of inflation and cost pressures across the insurance market. A year end overspend. Subjective Analysis forecast Variance Subjective Description This budget covers electricity, gas, rates, rents, cleaning and insurance costs. Variance Narrative This budget covers all employees charged directly to the HRA including caretakers. Variance Narrative The employee cost overspend reflects the impact of the 2023/24 local government pay award that was greater than the budgeted pay increase. A year end overspend. Budget Details Variance Analysis Budget Details Variance Analysis Subjective Analysis forecast Variance Subjective Description
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HRA REVENUE BUDGETARY CONTROL 2023/24 ANALYSIS FOR VARIANCES OVER £50,000 MONTH END DATE 31 March 2024 PERIOD 12 Budget Forecast Spend RAG Status £000 £000 £000 % Repairs & Maintenance 16,257 15,063 (1,194) -7% Main Issues Mitigating Action Anticipated Outcome Budget Forecast Spend RAG Status £000 £000 £000 % Void Loss (Council Tax/Lost Rents) 1,261 1,518 257 20% Main Issues Mitigating Action Anticipated Outcome This budget covers the rents lost on void houses and lockups and the cost of council tax on void properties. Variance Narrative The adverse variance relates to void numbers being higher than expected at time of budget setting. The increased void numbers have an adverse impact on void rent loss and void house council tax payments. Void turnaround times were longer than anticipated as result of the high number of voids at the start of the financial year. We also continue to experience challenges with utility companies resolving debt on meters and meter reconnections which adversely impacts on the length of time properties are void. There was an improving trend with voids, with void numbers reducing during the year. A year end overspend. Budget Details Variance Analysis Subjective Analysis forecast Variance Service Description A year end underspend. Service Description This budget covers all repair and maintenance expenditure to houses and lockups Variance Narrative A higher volume of repair orders, partly due to the clearance of a COVID related backlog, and inflationary pressures with pay and construction materials has driven up both in-house repairs team ( Building Services) and external contractor costs. These costs pressures have led to overspends on responsive repair and void repair budgets. These overspends have been offset by an underspend against the electrical installation inspection reports ( EICR) budget where some of the planned programme has slipped into the next financial year, an underspend against the WDTRO budget and by additional rechargeable repair income. Budget Details Variance Analysis Subjective Analysis forecast Variance
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HRA REVENUE BUDGETARY CONTROL 2023/24 ANALYSIS FOR VARIANCES OVER £50,000 MONTH END DATE 31 March 2024 PERIOD 12 Budget Forecast Spend RAG Status £000 £000 £000 % Loan Charges 15,476 19,422 3,946 25% Main Issues Mitigating Action Anticipated Outcome Budget Forecast Spend RAG Status £000 £000 £000 % CFCR 1,729 0 (1,729) -100% Main Issues Mitigating Action Anticipated Outcome Budget Forecast Spend RAG Status £000 £000 £000 % House Rents (47,728) (47,954) (226) 0% Main Issues Mitigating Action Anticipated Outcome Budget Forecast Spend RAG Status £000 £000 £000 % Factoring/Insurance Charges (1,434) (1,499) (65) 5% Main Issues Mitigating Action Anticipated Outcome A year end income over-recovery. Service Description Income received from insurance and factoring Variance Narrative The increased income reflects a 10% increase in fees in 2023/24 in line with the council's sales fees charges increase approved in March 2023. The budget only assumed a 4% increase Budget Details Variance Analysis Subjective Analysis forecast Variance Service Description This budget covers the rental income due from tenants Variance Narrative Rent income slightly higher than budget relecting a lower than budgeted transfer of sheltered housing rental income to the HSCP A year end income over-recovery. A year end underspend. Budget Details Variance Analysis Subjective Analysis forecast Variance Service Description This budget covers the contribution from revenue to capital Variance Narrative The cost pressures across the HRA revenue budget meant that there was no scope to make a revenue contribution to capital spend in 2023/24. The adverse variance is the due to loan interest payments being higher than anticipated at time of budget setting. Local authority borrowing costs have increased over the last 12 - 18 months and this has driven up our debt financing costs. A year end overspend. Budget Details Variance Analysis Subjective Analysis forecast Variance Subjective Analysis forecast Variance Service Description Loan Charges is made up of the repayments of principal sums and the payment of interest and expenses Variance Narrative Budget Details Variance Analysis
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HRA REVENUE BUDGETARY CONTROL 2023/24 ANALYSIS FOR VARIANCES OVER £50,000 MONTH END DATE 31 March 2024 PERIOD 12 Budget Forecast Spend RAG Status £000 £000 £000 % Interest on Revenue Balance (30) (199) (169) 563% Main Issues Mitigating Action Anticipated Outcome Budget Forecast Spend RAG Status £000 £000 £000 % Transfer from / to Reserves 0 (1,666) (1,666) 0% Main Issues Mitigating Action Anticipated Outcome Reduction in HRA reserves at 31 March 2024 Service Description Transfer of year end under/overspend to HRA reserves. Variance Narrative The recent sharp increase in local government borrowing costs and the inflationary pressures across budgets meant that it was necessary to drawdown £1.666mm from HRA reserves to deliver a break even position. The current reserve balance is £2.634M. The drawdown has reduced HRA reserves to £0.968m at March 24 which is below the 2023/24 prudential target of £0.984M. Budget Details Variance Analysis Subjective Analysis forecast Variance Interest receivable on HRA balances Variance Narrative The favourable variance relates to the recent increase in interest rates. This has resulted in higher interest earned on cash balances. A year end income over-recovery. Budget Details Variance Analysis Subjective Analysis forecast Variance Service Description