Financial Reports Monitoring Pack - 31 August 2022
Argyll and Bute Council · 13 October 2022
Back to Policy and Resources Committee — 13 October 2022 and its agenda
Text extracted from the council's PDF. Layout and reading order may differ from the original.
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 13 OCTOBER 2022 FINANCIAL REPORTS MONITORING PACK – 31 AUGUST 2022 1. INTRODUCTION 1.1 This report provides a summary of the financial monitoring reports as at the end of August 2022. There are five detailed reports, setting out the position as at 31 August 2022, which are summarised in this Executive Summary: • Revenue Budget Monitoring Report • Monitoring of Financial Risks • Capital Plan Monitoring Report • Treasury Monitoring Report • Reserves and Balances 2. DETAIL 2.1 Revenue Budget Monitoring Report 2.1.1 This report provides a summary of the current revenue budget monitoring position to ensure net expenditure is contained within budget. It provides corporate and departmental information with comparisons on a forecast outturn and a year to date basis. 2.1.2 There is a forecast overspend of £0.117m as at the end of August 2022. This projection results from the elected members pay award (£0.026m), an under- recovery of income within parks and pest control (£0.070m) and high demand for services within Social Work (£0.021m). Note the elected members pay award is set nationally via Statutory Instrument and the forecast overspend is due to a 5.2% increase which is above the 2% previously built into the budget. 2.1.3 The forecast overspend does not include the potential impact of the 2022-23 pay settlement, where negotiations are at an advanced stage. The Scottish Government has agreed to provide an additional £140m of recurring resource from 2022-23 to support the current proposal of a 5% pay award which includes a £3,000 cap for those earning above £60,000 based on a 37 hour week. In addition, the Scottish Government have agreed to provide a further £120.6m of capital funding in 2022-23 and 2023-24 which will be baselined as General Revenue Grant from 2024-25 onwards to ensure that everyone receives an increase of at least £1,925 or £2,000 (depending on spinal column point). There remains a budget pressure that both the Council and the HSCP will require to fund. As is normal practice, the Health and Social Care Partnership need to absorb any cost pressure in the same way that the Council do and we await the detail on the additional funding as to whether any has to be passported through to the Health and Social Care Partnership and will look to have a conversation with both the Chief Officer and the Chief Financial Officer of the IJB in respect of this. Depending on the treatment of the funding, the gap for the
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Council could be in the region of £1.2m to £2.1m with a gap for the HSCP in the region of £0.5m to £1.4m 2.1.4 There is a year to date underspend of £2.970m. More focus is on the forecast outturn position, hence why sometimes the year to date position is not updated. The year to date variances mainly relate to the timing of income and expenditure and recharging of costs to capital. 2.1.5 With regard to the ongoing financial impact of COVID-19, there are £9.407m of reserves committed to manage the impact of the pandemic. The detail behind these commitments is contained within Appendix 2 of the Reserves and Balances report. 2.1.6 Total policy savings relevant to 2022-23 financial year amount to £1.560m. The table below outlines their progress as at 31 August 2022. Category No. of Options 2022-23 £000 2022- 23 FTE 2023-24 £000 2023- 24 FTE Future Years £000 Future Years FTE Delivered 5 235.0 1.4 243.0 1.4 243.0 1.4 On Track to be Delivered 12 603.5 0.5 606.5 0.5 609.5 0.5 Still to be Implemented 2 294.7 0.0 414.3 0.0 414.3 0.0 Being Developed 0 0.0 0.0 0.0 0.0 0.0 0.0 Potential Shortfall 4 402.5 0.0 402.5 0.0 402.5 0.0 Delayed 1 24.0 0.0 24.0 0.0 24.0 0.0 TOTAL 24 1,559.7 1.9 1,690.3 1.9 1,693.3 1.9 2.1.7 For those savings approved prior to February 2022, there are four savings categorised as having a shortfall and one currently delayed. Health and Social Care Partnership (HSCP) – Financial Update 2.1.8 The forecast outturn position at the end of August is an estimated overspend of £0.521m for 2022-23 (£0.021m for Social Work and £0.500m for Health). The Chief Financial Officer of the IJB is confident that the spend will be brought in line with budget by the end of the financial year. 2.2 Monitoring of Financial Risks 2.2.1 This report outlines the process and approach developed in carrying out a financial risks analysis and provides an update on the current assessment of financial risks. 2.2.2 There are 5 Council wide revenue risks identified for 2022-23 currently amounting to £2.058m.
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2.2.3 There are currently 42 departmental risks totalling £5.745m. Of the 42 departmental risks, one is categorised as almost certain and 7 are categorised as likely. These will continue to be monitored and action taken to mitigate or manage these risks. 2.2.4 The top three risks in terms of the financial impact are noted in the table below. SERVICE TITLE OF RISK DESCRIPTION OF RISK LIKELIHOOD FINANCIAL IMPACT £000 Roads and Infrastructure Services Roads Maintenance - Bridges, Culverts & Sea Defences Extreme localised weather may result in loss of bridge, culvert , road or sea defence 3 750 Roads and Infrastructure Services Residual Waste H&L and Tiree There is a potential increase to tipping fees and haulage costs for H&L residual waste. The Council’s supplier Barr Environmental (contract to end of 2023) lost a tribunal relating to the underpayment of landfill tax, which may have led to the Council having to source alternatives at a higher cost. Barr appealed the decision which was heard in the Spring and they won the case which should have reduced or eliminated this financial risk. However, the Scottish Government laid an Amendment Order on Friday 1 July 2022 which came into force at 1700 on 1 July which indicates that Landfill tax will be due on materials previously not chargeable and we have now received notification of an increase in the cost which officers are currently assessing. 4 655 Financial Services Council Tax Debt Collection Recovery Recovery of debt becomes more difficult to pursue in the current economic climate. This is in relation to historical debt that has accumulated over many years therefore any adverse collection rates will impact on the year end debt provision as opposed to the in- year financial position, hence no forecast variance has been reported within the current year. 5 500
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2.2.5 There have been three changes to the departmental risks since the report as presented to the Policy and Resources Committee on 11 August 2022. These are outlined in paragraph 3.4.1 of the Financial Risks Report. 2.3 Capital Plan Monitoring Report 2.3.1 This report provides a summary of the current capital plan monitoring position. Information is provided in terms of monitoring year to date budget, current full year budget, future years total budget and funding and non-financial in terms of project performance. 2.3.2 2.3.3 At the budget setting meeting on 25 February 2021, the Council agreed to provide a £2.5m provision for the increase in capital contract costs as a result of COVID-19 and following agreement at the Policy and Resources Committee on 14 October 2021, this, plus a further £0.146m, was added to the capital programme. At the budget meeting in February 2022 an additional £3.9m was set aside for further capital contract increases including up to £1.2m for Campbeltown Flood Scheme. There are likely to be further financial pressures facing the capital programme that are not able to be quantified at this stage largely relating to inflationary increases in the construction industry and supply chain issues. 2.3.4 Actual net expenditure to date is £10.954m compared to a budget for the year to date of £10.857m giving rise to an overspend for the year to date of £0.097m (0.9%). The variance results from an accumulation of non-material variances across projects. 2.3.5 The forecast outturn for 2022-23 is a forecast net expenditure of £48.264m compared to an annual budget of £48.260m giving rise to a forecast overspend for the year of £0.004m (0.01%). 2.3.6 The forecast total net projects costs on the capital plan are £178.745m compared to a total budget for all projects of £178.526m giving rise to a forecast overspend for the overall capital plan of £0.219m (0.12%). 2.3.7 In respect of total project performance, there are 160 projects within the capital plan, 148 are complete or on target, 11 are off target and recoverable and 1 project is off track. 2.4 Treasury Monitoring Report 2.4.1 This report provides information on the current levels and recent transactions in relation to the capital financing limit, total borrowing, temporary borrowing and long term borrowing and investments. 2.4.2 The net movement in external borrowing for the period 1 July 2022 to 31 August 2022 was a decrease of £3.496.
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2.4.3 Borrowing is below the Capital Financing Requirement for the period to 31 August 2022. At this stage in the financial year capital expenditure continues to be below target. Due to delays as a result of the COVID-19 pandemic, capital expenditure has been relatively low over the last twelve months. 2.4.4 The levels of investments were £117.4m at 31 August 2022. The average rate of return achieved was 1.802% which compares favourably with the SONIA (Sterling Overnight Index Average) for the same period of 1.641%. 2.5 Reserves and Balances 2.5.1 This report summarises the overall level of reserves and balances and monitors the spending of the earmarked reserves, providing detailed information on the unspent budget earmarked balances. 2.5.2 The Council has a total of £364.558m unusable reserves that are not backed with resources. They are required purely for accounting purposes. 2.5.3 At 31 March 2022, the Council had a total of £103.626m of usable reserves. Of this: • £2.682m relates to the Repairs and Renewals Fund • £4.414m relates to Capital Funds • £96.530m was held in the General Fund, with £89.433m of this balance earmarked for specific purposes. 2.5.4 Of the earmarked balance of £89.433m: • £46.510m is invested or committed for major initiatives/capital projects • £4.094m has already been drawn down • £32.402m is still to be drawn down in 2022-23 • £6.427m is planned to be spent in future years 2.5.5 The table below summarises the estimated Unallocated General Fund Balance as at the end of the financial year: Heading Detail £000 Unallocated General Fund as at 31 March 2022 This is the balance that is unallocated over and above the 2% contingency, which amounts to £5.256m 1,841 Budgeted allocation to General Fund for 2022-23 Budget Per the Budget Motion at Council on 24 February 22 2,482 Current Forecast Outturn for 2022-23 as at 31 August 2022 (157)
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Estimated Unallocated balance as at 31 March 2023 4,166 2.5.6 It can be seen that, after taking into consideration the Budget Motion and the current forecast outturn for 2022-23, the Council is forecast to have a £4.166m surplus over contingency. The balance does not take into account the 2022-23 pay award currently in the final stages of negotiation. 2.6 VIREMENTS OVER £0.200m (Revenue) 2.6.1 Virement is the process of transferring budget between cost centres, services or departments or between capital projects. The Council’s constitution notes that virements over £0.200m require approval by Council. This section of the report will be used to outline revenue virements in the period that require approval. Capital virements are included within the capital monitoring report. 2.6.2 For the periods July and August 2022, there are 5 virements requiring authorisation: - £0.308m harvested within Executive Director Kirsty Flanagan against the vacancy savings target for the period April to July - £0.383m harvested within Social Work against the vacancy savings target for the period April to July - £0.204m between Head of Education and Head of Commercial Services in relation to NPDO charges - £0.250m between Roads and Infrastructure and Other Operating Income and Expenditure in relation to a miscoding on saving RI01 - £0.328m harvested within Social Work against the vacancy savings target for August 3. RECOMMENDATIONS 3.1 It is recommended that the Policy and Resources Committee: a) Consider the revenue budget monitoring report as at 31 August 2022 b) Note the financial risks for 2022-23 c) Note the capital plan monitoring report as at 31 August 2022 and approve the proposed changes to the capital plan outlined in Appendix 4 of that report. d) Note the treasury monitoring report as at 31 August 2022 e) Consider the reserves and balances report as at 31 August 2022 f) Recommend to Council that the revenue virements over £0.200m during July and August 2022 are approved
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4. IMPLICATIONS 4.1 Policy – None. 4.2 Financial - Outlines the revenue and capital monitoring for 2022-23 as at 31 August 2022 4.3 Legal - None. 4.4 HR - None. 4.5 Fairer Scotland Duty - None. 4.5.1 Equalities – protected characteristics - None. 4.5.2 Socio-economic Duty - None. 4.5.3 Islands - None. 4.6 Climate Change - None. 4.7 Risk - Risks are included in financial risks report. 4.8 Customer Service - None. Kirsty Flanagan Section 95 Officer 9 September 2022 Policy Lead for Finance and Commercial Services - Councillor Gary Mulvaney For further information contact Anne Blue, Head of Financial Services anne.blue@argyll-bute.gov.uk
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REVENUE BUDGET MONITORING REPORT AS AT 31 AUGUST 2022 POLICY AND RESOURCES COMMITTEE 13 OCTOBER 2022 2022-23 Overall Position: There is an overall forecast overspend of £0.117m as at the end of August 2022. Within Executive Director Kirsty Flanagan, there is a forecast overspend of £0.070m from a projected under-recovery of income within Parks and Pest Control. Within Central Budgets, there is a £0.026m overspend resulting from the Elected Members pay award being greater than the available budget and Social Work is projecting a £0.021m overspend due to a high demand for services. There is a year to date underspend of £2.970m. The year to date variances within the departments tend to relate to the timing of income and expenditure, the recharging of costs to capital and the over-recovery of vacancy savings. Key Highlights as at August 2022: • The Oracle Fusion system hypercare stage of implementation is complete and training has been rolled out to wider services. • The negotiations relating to the 2022-23 pay award are at an advanced stage with the current offer out to ballot. Key Financial Successes: Performance against budget for 2021-22 was an overall net favourable position of £1.630m underspend after adjusting for year-end earmarking. This breaks down as: • £0.815m net underspend in relation to Council service departmental expenditure • £0.432m net overspend in relation to other central costs • £1.247m over-recovery of Council Tax income. Key Financial Challenges: Proposed Actions to address Financial Challenges: Ongoing consideration of the financial impact of COVID on the Council’s revenue position. Continue to identify additional costs as a consequence of COVID to ensure earmarked COVID funds are applied appropriately. Achieving a favourable year-end position and achieving savings targets in light of council wide risks to expenditure. Robust monitoring of the financial position and delivery of savings to ensure budget issues inform the budget monitoring process. Monitoring Social Work expenditure and more widely the IJB position as any overspend will transfer back to partner bodies in the first instance. Continue to work closely with the CFO of the IJB to ensure that early indication of any potential adverse financial outturn is known and corrective action is agreed as appropriate to reduce the risk to the Council. Identifying further savings and delivering services more efficiently with less resources, as whilst a balanced 2022-23 budget was agreed in February 2022 there are still budget gaps in future years. The Council will continue to progress savings options identified in 2021-22 that require further development and seek to identify further savings through themed reviews and business process reviews.
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Maintaining or improving the level of service income recovered, for example planning, building standards and car parking. Actively monitor income recovery and ensure Council fees and charges policies are regularly reviewed. Managing spend in service areas which are demand led and, to some extent, outwith service control, for example Winter Maintenance. Use risk based approach to budget monitoring to focus additional attention on these areas. Ongoing requirement to fund unavoidable inflationary increases in areas like utility costs, fuel, food etc. This is impacted further by the availability of supply as a result of the COVID-19 pandemic, UK exit from the European Union, Russia’s invasion of Ukraine and sanctions on Russian owned entities to name a few influencing factors. Ensure emerging issues are highlighted as soon as possible so that the financial impact can be reported through the budget monitoring and preparation processes. Cost of living crisis impacting on pay inflation negotiations which could result in pay awards above what is deemed affordable. Ensure emerging issues are highlighted as soon as possible so that the financial impact can be reported through the budget monitoring and preparation processes. Forecast Outturn Position There is a forecast overspend of £0.157m for 2022-23 as at the end of August 2022 Department Annual Budget £'000 Forecast Outturn £'000 Current Forecast Variance £'000 Previous Forecast Variance £000 Change £000 Explanation Chief Executive's Unit 6,353 6,353 0 0 0 Department forecasting in line with budget Executive Director (Douglas Hendry) 125,532 125,532 0 0 0 Department forecasting in line with budget Executive Director (Kirsty Flanagan) 44,942 45,012 (70) 0 (70)Overspend due to under recovery of income in Parks and Pest Control Social Work 72,911 72,932 (21) (75) 54 Overspend is mainly due to high demand for services Central Budgets 23,867 23,893 (26) 0 (26)Overspend due to Elected Members pay award being higher than available budget Financed By (273,605) (273,605) 0 0 0 Total 0 117 (117) (75) (42) Current Forecast Outturn Variance with change from previous month
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(80) (70) (60) (50) (40) (30) (20) (10) 0 10 20 30 40 50 60 70 80 April May June July August September October November December January February £ 000 Movement in the forecast outturn position for each Department from the start of the financial year Chief Executive's Unit Executive Director (Kirsty Flanagan) Executive Director (Douglas Hendry) Social Work Underspend Overspend Further information on the departmental forecast variances is included later on in the report.
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Year to Date Position The year to date position as at the end of August 2022 is an underspend of £2.970m and the main variances are noted below. Department YTD Actual £'000 YTD Budget £'000 YTD Variance £'000 Explanation Chief Executive's Unit 3,571 3,316 (255) The YTD overspend can be attributed to profiling issues. Executive Director (Douglas Hendry) 45,067 45,686 619 The YTD underspend can be attributed to underspends in employee budgets within schools and learning centres Executive Director (Kirsty Flanagan) 17,541 16,326 (1,215) The YTD overspend can be attributed to expenditure in Roads on capital works not recharged yet. Social Work 14,929 15,118 189 The YTD underspend can be attributed to over-recovery of vacancy savings. Central Budgets 2,960 6,592 3,632 The YTD underspend can be attributed to profiling issues. Funding (113,128) (113,128) 0 Total Net Expenditure (29,060) (26,090) 2,970
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0% 25% 50% 75% 100% Chief Executive's Unit Executive Director (Kirsty Flanagan) Executive Director (Douglas Hendry) Social W ork Central Budgets TOTAL Expenditure to date against the remaining budget for each Department YTD Actual Remaining Budget Further information on the departmental year to date variances is included later on in the report.
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OBJECTIVE SUMMARY – OVERALL COUNCIL POSITION AS AT 31 AUGUST 2022 YTD Actual YTD Budget YTD Variance Variance Annual Budget Forecast Outturn Forecast Variance Variance £'000 £'000 £'000 % £'000 £'000 £'000 % Departmental Budgets Chief Executive's Unit 3,571 3,316 (255) (7.7%) 6,353 6,353 0 0.0% Executive Director (Kirsty Flanagan) 17,541 16,326 (1,215) (7.4%) 44,942 45,012 (70) (0.2%) Executive Director (Douglas Hendry) 45,067 45,686 619 1.4% 125,532 125,532 0 0.0% Social Work 14,929 15,118 189 1.3% 72,911 72,932 (21) (0.0%) Total Departmental Budgets 81,108 80,446 (662) (0.8%) 249,738 249,829 (91) (0.0%) Central Budgets Other Operating Income and Expenditure (1,184) 582 1,766 303.4% 2,019 2,045 (26) (1.3%) Joint Boards 626 623 (3) (0.5%) 1,496 1,496 0 0.0% Non-Controllable Costs 3,518 5,387 1,869 34.7% 20,352 20,352 0 0.0% Total Central Budgets 2,960 6,592 3,632 55.1% 23,867 23,893 (26) (0.1%) TOTAL NET EXPENDITURE 84,068 87,038 2,970 3.4% 273,605 273,722 (117) (0.0%) Financed By Aggregate External Finance (87,163) (87,163) 0 0.0% (216,731) (216,731) 0 0.0% Local Tax Requirement (25,965) (25,965) 0 0.0% (55,262) (55,262) 0 0.0% Contributions to General Fund 0 0 0.0% 2,482 2,482 0 0.0% Earmarked Reserves 0 0 0.0% (4,094) (4,094) 0 0.0% Total Funding (113,128) (113,128) 0 0.0% (273,605) (273,605) 0 0.0% (Deficit)/Surplus for Period (29,060) (26,090) 2,970 0 117 (117) CURRENT PROJECTED FINAL OUTTURNYEAR TO DATE POSITION
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SUBJECTIVE SUMMARY – OVERALL COUNCIL POSITION AS AT 31 AUGUST 2022 YTD Actual YTD Budget YTD Variance Variance Annual Budget Forecast Outturn Forecast Variance Variance £'000 £'000 £'000 % £'000 £'000 £'000 % Subjective Category Employee Expenses 63,221 64,126 905 1.4% 170,283 170,512 (229) (0.1%) Premises Related Expenditure 8,159 7,996 (163) (2.0%) 16,716 16,844 (128) (0.8%) Supplies and Services 10,276 9,241 (1,035) (11.2%) 23,269 23,459 (190) (0.8%) Transport Related Expenditure 5,419 4,874 (545) (11.2%) 17,046 17,008 38 0.2% Third Party Payments 62,064 61,493 (571) (0.9%) 165,601 166,391 (790) (0.5%) Capital Financing 1,248 0 (1,248) 14,039 14,039 0 0.0% TOTAL EXPENDITURE 150,387 147,730 (2,657) (1.8%) 406,954 408,253 (1,299) (0.3%) Income (179,448) (173,821) 5,627 (3.2%) (406,954) (408,136) 1,182 (0.3%) (Deficit)/Surplus for Period (29,060) (26,090) 2,970 0 117 (117) YEAR TO DATE POSITION CURRENT PROJECTED FINAL OUTTURN YTD is year to date and represents the actual or budgeted expenditure and income for the financial year so far. Forecast Outturn is the estimate now of what expenditure or income will be for the whole of the financial year. The Variance is the difference between budget and actual or forecast outturn. A positive variance is when actual or forecast expenditure is less than budget or actual or forecast income is more than budget. A negative variance is shown in brackets and is when actual or forecast expenditure is more than budget or actual or forecast income is less than budget.
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CHIEF EXECUTIVE’S UNIT – AS AT 31 AUGUST 2022 The department is currently forecasting spend in line with budget. The department has a year to date overspend of £0.255m (7.7%) which can be attributed to profiling issues. Forecast Outturn Position Service Annual Budget £000 Forecast Outturn £000 Current Forecast Variance £000 Previous Forecast Variance £000 Change £000 Chief Executive 909 909 0 0 0 Head of Financial Services 5,444 5,444 0 0 0 Totals 6,353 6,353 0 0 0 Year to Date Position 0% 25% 50% 75% 100% Chief Executive Head of Financial Services Expenditure to date against the remaining budget for each Service YTD… Remaining Budget… Key Financial Successes: • All savings options have been delivered. • The department’s 2021-22 outturn position was an underspend of £0.018m. This resulted from an overall underspend of £2.013m offset by earmarking of £1.769m due to auto-carry forwards including unspent grants and COVID-19 funding and £0.226m of unspent budget earmarkings. Key Financial Challenges: Proposed Actions to address Financial Challenges: To continue to deliver a high quality support service function during a time of substantial uncertainty and challenge arising from continuing reductions in funding whilst costs are increasing due to high inflation and service demand caused by world events including the COVID-19 pandemic and the conflict in Ukraine. Ensure the team is operating as efficiently and effectively as possible to enable continued support to departments with reduced resources by building resilience through knowledge sharing across the team and maximising the benefits to the service from the implementation of the Oracle Fusion Financial Ledger System.
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Carry out a business process review of the Revenues and Benefits function to determine if there is scope to deliver the service in a more cost effective manner. Work collaboratively with other services of the Council to identify opportunities to improve the operational and financial efficiency of services and to support evidence based decision making.
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CHIEF EXECUTIVE’S UNIT – OBJECTIVE SUMMARY AS AT 31 AUGUST 2022 Service Area YTD Actual £000 YTD Budget £000 YTD Variance £000 % Variance Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation Chief Executive 128 119 (9) (7.6%) 325 325 0 0.0% Outwith Reporting Criteria Community Planning & Development 208 242 34 14.1% 584 584 0 0.0% Profiling - income received ahead of schedule 336 361 25 6.9% 909 909 0 0.0% Accounting & Budgeting 1,017 999 (18) (1.8%) 2,374 2,374 0 0.0% Outwith Reporting Criteria Internal Audit & Fraud 105 105 0 0.0% 231 231 0 0.0% Outwith Reporting Criteria Revenues & Benefits 1,326 1,345 19 1.4% 2,102 2,102 0 0.0% Outwith Reporting Criteria Scottish Welfare Fund 787 506 (281) (55.5%) 737 737 0 0.0% Profile related overspend on third party payments and income accrued but not yet received. 3,235 2,955 (280) (9.5%) 5,444 5,444 0 0.0% 3,571 3,316 (255) (7.7%) 6,353 6,353 0 0.0% YTD is year to date and represents the actual or budgeted expenditure and income for the financial year so far. Forecast Outturn is the estimate now of what expenditure or income will be for the whole of the financial year. The Variance is the difference between budget and actual or forecast outturn. A positive variance is when actual or forecast expenditure is less than budget or actual or forecast income is more than budget. A negative variance is shown in brackets and is when actual or forecast expenditure is more than budget or actual or forecast income is less than budget. An explanation is given for any variance which exceeds £50,000 or 10%.
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CHIEF EXECUTIVE’S UNIT – SUBJECTIVE SUMMARY AS AT 31 AUGUST 2022 Subjective Category YTD Actual £000 YTD Budget £000 YTD Variance £000 % Variance Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation Employee 1,921 1,890 (31) (1.6%) 5,173 5,173 0 0.0% Outwith reporting criteria. Premises 0 0 0 0.0% 0 0 0 0.0% Outwith reporting criteria. Supplies and Services 239 258 19 7.4% 695 695 0 0.0% Outwith reporting criteria. Transport 5 14 9 64.3% 32 32 0 0.0% Underspends on staff travel budgets. Third Party 8,793 9,248 455 4.9% 25,195 25,195 0 0.0% An underspend of £0.531m on Housing Benefits (offset against income) offset by an overspend against the Scottish Welfare Fund. Income (7,387) (8,094) (707) 8.7% (24,742) (24,742) 0 0.0% An overspend of £0.531m on Housing Benefits (offset against third party payments) and an overspend against the Scottish Welfare Fund. Totals 3,571 3,316 (255) (7.7%) 6,353 6,353 0 0.0% YTD is year to date and represents the actual or budgeted expenditure and income for the financial year so far. Forecast Outturn is the estimate now of what expenditure or income will be for the whole of the financial year. The Variance is the difference between budget and actual or forecast outturn. A positive variance is when actual or forecast expenditure is less than budget or actual or forecast income is more than budget. A negative variance is shown in brackets and is when actual or forecast expenditure is more than budget or actual or forecast income is less than budget.
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An explanation is given for any variance which exceeds £50,000 or 10%.
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CHIEF EXECUTIVE’S UNIT – RED VARIANCES AS AT 31 AUGUST 2022 Service Area Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation 0 0.0% A red variance is a forecast variance which is greater than +/- £50,000.
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EXECUTIVE DIRECTOR (DOUGLAS HENDRY) – AS AT 31 AUGUST 2022 The department is currently forecasting spend in line with budget. The department has a year to date (YTD) underspend of £0.619m (1.4%). The year to date underspend position is mainly due to underspends in employee budgets within schools and learning centres. Under the Scheme of Devolved School Management schools are permitted flexibility at the end of the year so no forecast variance is required. The remaining variances are profile related and will be refined through September. Forecast Outturn Position Service Annual Budget £000 Forecast Outturn £000 Current Forecast Variance £000 Previous Forecast Variance £000 Change £000 Executive Director (Douglas Hendry) 105 105 0 0 0 Head of Commercial Services 9,703 9,703 0 0 0 Head of Education 96,614 96,614 0 0 0 Head of Legal and Regulatory Support 19,110 19,110 0 0 0 Totals 125,532 125,532 0 0 0 Year to Date Position Key Financial Successes: The 2021-22 year-end consolidated outturn position was an under spend of £0.223m after adjusting for earmarkings. This was due to the effective contract management of NPDO and Hub School contracts, including a lower than expected insurance premium as a result of the annual renegotiation of insurance costs. The costs of COVID were contained and minimised where possible across departments, with staff 0% 25% 50% 75% 100% Executive Director (Douglas Hendry) Head of Commercial Services Head of Education Head of Legal and Regulatory Support Expenditure to date against the remaining budget for each Service YTD… Remaining Budget…
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from all areas of the service assisting in planning, implementing and delivering a wide range of additional services in schools and communities and helping businesses through the return from lockdown. Key Financial Challenges: Proposed Actions to address Financial Challenges: The ongoing impact of COVID-19 Costs are being contained where possible. Impact of numbers/uptake in demand led service areas like catering, design services and licensing. Continually refine/develop systems to accurately calculate forecast outturns and the impact on the future financial outlook. Manage the impact of the Statutory Guidance supporting Nutritional Requirements for Food and Drink in Schools (Scotland) Regulations 2020, on the cost of producing school meals and also the uptake. Monitor and report on the impact on costs and on income as the year progresses. Support longer term service re-design project for Catering and Cleaning services to ensure efficiencies and financial savings are secured for the Council as well as delivery of free school meals for 1140 hours of Early Learning and Childcare and the phased universal free school meals expansion in Primary Schools. Effective working with partners and support with implementation of service delivery method. Continual monitoring and review of budgets. Legislative/policy requirements not fully funded by Scottish Government which may put additional burdens on the Council. For example, the introduction of free school meal payments for holidays. Analysis of new obligations and whether they incur additional costs not met through increased grant. The Council has a requirement to deliver 1140 hours of Early Learning and Childcare. The initial funding from Scottish Government was based on individual implementation plans with funding confirmed up to March 2022. The ring fenced grant has been reduced in 2022-23 and an exercise is required to ensure that the service can be delivered efficiently and effectively within this reduced funding allocation. Robust service costings, financial monitoring and timely reporting to ensure the service can continue to deliver the service within the financial resources available. Impact of high inflationary uplifts within the NPDO/HUB School contracts. Ensuring continued effective contract management of NPDO/HUB Schools to minimise the impact of high inflationary uplifts.
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EXECUTIVE DIRECTOR (DOUGLAS HENDRY) – OBJECTIVE SUMMARY AS AT 31 AUGUST 2022 Service Service Area YTD Actual £000 YTD Budget £000 YTD Variance £000 % Variance Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation Executive Director (Douglas Hendry) Central/Management Costs 131 146 15 10.3% 105 105 0 0.0% The YTD underspend of £15k is due to budget profiling which will be refined through September. 131 146 15 10.3% 105 105 0 0.0% Head of Commercial Services Catering (67) (88) (21) 23.9% 965 965 0 0.0% The YTD overspend of £21k is due to £11k of expenditure that has been miscoded and will be rectified in September and a number of small profiling variances that will be refined through September. Head of Commercial Services Central/Management Costs 446 385 (61) (15.8%) 1,018 1,018 0 0.0% The YTD overspend of £61k is due to £30k of earmarked expenditure that will be drawn down in September to rectify and a number of profiling issues that will be refined through September. Head of Commercial Services CHORD 27 25 (2) (8.0%) 20 20 0 0.0% Outwith Reporting Criteria Head of Commercial Services Cleaning (25) 15 40 266.7% 417 417 0 0.0% The YTD underspend of £40k is mainly due to the profiling of income budgets which will be refined through September. Head of Commercial Services Culture, Heritage, Recreation & Sport 2,423 2,432 9 0.4% 5,812 5,812 0 0.0% Outwith Reporting Criteria Head of Commercial Services Events & Commercial Catering 84 23 (61) (265.2%) 113 113 0 0.0% The YTD overspend of £61k is due to an under recovery of income caused by the closure of the Civic Centre Café and reduced footfall within Kilmory
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Canteen. There is also an under recovery of income within Events as a result of the slow recovery from the pandemic. Head of Commercial Services Property Portfolio (152) (114) 38 (33.3%) (194) (194) 0 0.0% The YTD underspend of £38k is due to the profiling of rental income and will be rectified in September. Head of Commercial Services Property Services 505 309 (196) (63.4%) 500 500 0 0.0% The YTD overspend of £196k is due to a £124K variance within Renewable Energy due to profiling and the profiling of property Services charges. Profiling will be refined through September. Head of Commercial Services Shared Offices 356 372 16 4.3% 1,052 1,052 0 0.0% Outwith Reporting Criteria 3,597 3,359 (238) (7.1%) 9,703 9,703 0 0.0% Head of Education Additional Support for Learning 3,711 3,795 84 2.2% 9,900 9,900 0 0.0% The YTD underspend of £84k is due to an accrual for ASN adaptions, with invoices still to be received; delays in recruitment of ASN Assistants and vacancies within Pupil Support Teachers. Head of Education Central/Management Costs 729 715 (14) (2.0%) 1,898 1,898 0 0.0% Outwith Reporting Criteria Head of Education Community Learning & Development 2 2 0 0.0% 10 10 0 0.0% Outwith Reporting Criteria Head of Education COVID 407 415 8 1.9% 1,206 1,206 0 0.0% Outwith Reporting Criteria Head of Education Early Learning & Childcare (2,301) (2,191) 110 (5.0%) 8,328 8,328 0 0.0% The YTD underspend of £110k is due to the profiling of teacher input time in ELC settings. The profile will be refined in September. Head of Education Primary Education 14,580 14,852 272 1.8% 35,394 35,394 0 0.0% The YTD underspend of £272k within Primary Education is mainly due to underspends within school staffing budgets. Under the Scheme of Devolved School Management (DSM) schools are permitted flexibility at yearend,
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therefore no forecast variance has been processed in relation to this. There are also underspends within Pupil Equity Funding which are profile related and will be refined through September. Both above underspends are partially offset by a profile related overspend within Commercial Refuse which will also be refined through September. Head of Education Pupil Support 921 863 (58) (6.7%) 2,412 2,412 0 0.0% There is a YTD overspend of £58k in Schools Residential Placements. It is likely that this will continue to be a pressure in 2022/23 and a forecast projection is currently being developed. Head of Education Schools - Central Services 913 894 (19) (2.1%) 2,711 2,711 0 0.0% Outwith Reporting Criteria Head of Education Secondary Education 14,570 14,883 313 2.1% 34,755 34,755 0 0.0% The YTD underspend of £313k in Secondary Education is mainly due to underspends within school staffing budgets. Under the Scheme of Devolved School Management (DSM) schools are permitted flexibility at yearend, therefore no forecast variance has been processed in relation to this. 33,532 34,228 696 2.0% 96,614 96,614 0 0.0% Head of Legal & Regulatory Support Central/Management Costs 87 95 8 8.4% 256 256 0 0.0% Outwith Reporting Criteria Head of Legal & Regulatory Support Community Safety 67 78 11 14.1% 173 173 0 0.0% The YTD underspend of £11k is profile related and will be rectified through September. Head of Legal & Regulatory Support Elections 201 212 11 5.2% 386 386 0 0.0% Outwith Reporting Criteria Head of Legal & Regulatory Support Governance 222 225 3 1.3% 777 777 0 0.0% Outwith Reporting Criteria
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Head of Legal & Regulatory Support Governance, Risk & Safety 194 199 5 2.5% 540 540 0 0.0% Outwith Reporting Criteria Head of Legal & Regulatory Support Legal Services 211 249 38 15.3% 650 650 0 0.0% The YTD underspend of £38k is due to a number of small variances that are profile related and will be refined through September. Head of Legal & Regulatory Support NPDO and Hub Schools 6,087 6,131 44 0.7% 14,474 14,474 0 0.0% Outwith Reporting Criteria Head of Legal & Regulatory Support Procurement, Commisioning and Contracts 373 420 47 11.2% 1,132 1,132 0 0.0% The YTD underspend of £47k is due to staff vacancies which will be advertised shortly following departmental restructure. Head of Legal & Regulatory Support Trading Standards & Advice Services 365 344 (21) (6.1%) 722 722 0 0.0% Outwith Reporting Criteria 7,807 7,953 146 1.8% 19,110 19,110 0 0.0% 45,067 45,686 619 1.4% 125,532 125,532 0 0.0% YTD is year to date and represents the actual or budgeted expenditure and income for the financial year so far. Forecast Outturn is the estimate now of what expenditure or income will be for the whole of the financial year. The Variance is the difference between budget and actual or forecast outturn. A positive variance is when actual or forecast expenditure is less than budget or actual or forecast income is more than budget. A negative variance is shown in brackets and is when actual or forecast expenditure is more than budget or actual or forecast income is less than budget. An explanation is given for any variance which exceeds £50,000 or 10%.
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EXECUTIVE DIRECTOR (DOUGLAS HENDRY) – SUBJECTIVE SUMMARY AS AT 31 AUGUST 2022 Subjective Category YTD Actual £000 YTD Budget £000 YTD Variance £000 % Variance Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation Employee 35,851 36,875 1,024 2.8% 95,713 95,713 0 0.0% Non-Education: The YTD underspend of £20k is due to delays in recruitment. Education: The YTD underspend of £1.004m is due to employee budgets within schools and learning centres. Under the Scheme of Devolved School Management schools are permitted flexibility at the end of the year so no forecast variance is required. Premises 2,548 2,370 (178) (7.5%) 7,232 7,232 0 0.0% Non-Education: There is no variance to report. Education: The YTD overspend of £178k is mainly due to the profiling of the Commercial Waste Recharge which will be rectified in September. Supplies and Services 4,389 4,548 159 3.5% 12,068 12,068 0 0.0% Non-Education: The YTD overspend of £49k is due to the profiling of catering purchases which will be refined through September and a small overspend within tools and equipment. Education: The YTD underspend of £208k is mainly due to the profiling of Pupil Equity Funding Budget Allocations from Scottish Government which will be refined through September. This underspend is offset slightly by overspends in subscriptions and licensing budgets. Transport 128 118 (10) (8.5%) 296 296 0 0.0% Outwith Reporting Criteria Third Party 18,117 18,116 (1) (0.0%) 40,308 40,308 0 0.0% Outwith Reporting Criteria Income (15,966) (16,341) (375) 2.3% (30,085) (30,085) 0 0.0% Non-Education: The £57k YTD under recovery of income is mainly due to the profiling of renewable energy feed in tariffs which will be refined through September. Education: The £318k YTD under recovery of income is due to profiling within School Meals, Education Maintenance Allowance and ASN Assistant budgets which are all profile related and will be refined through September. Totals 45,067 45,686 619 1.4% 125,532 125,532 0 0.0% YTD is year to date and represents the actual or budgeted expenditure and income for the financial year so far. Forecast Outturn is the estimate now of what expenditure or income will be for the whole of the financial year. The Variance is the difference between budget and actual or forecast outturn. A positive variance is when actual or forecast expenditure is less than budget or actual or forecast income is more than budget. A negative variance is shown in brackets and is when actual or forecast expenditure is more than budget or actual or forecast income is less than budget. An explanation is given for any variance which exceeds £50,000 or 10%.
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EXECUTIVE DIRECTOR (DOUGLAS HENDRY) – RED VARIANCES AS AT 31 AUGUST 2022 Service Area Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation A Red variance is a forecast variance which is greater than +/- £50,000.
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EXECUTIVE DIRECTOR (KIRSTY FLANAGAN) – AS AT 31 AUGUST 2022 The department is currently forecasting an overspend of £0.070m for the year. This is due to the under-recovery of income in Parks and Pest Control in Roads and Infrastructure Services. The department has a year to date overspend of £1.215m (7.4%). This is mainly due to additional expenditure in Roads due to capital works not yet recharged, this will be rectified as the recharges are processed to capital throughout the year. Forecast Outturn Position Service Annual Budget £000 Forecast Outturn £000 Current Forecast Variance £000 Previous Forecast Variance £000 Change £000 Executive Director (Kirsty Flanagan) 125 125 0 0 0 Head of Customer Support Services 7,913 7,913 0 0 0 Head of Development and Economic Growth 8,204 8,204 0 0 0 Head of Roads and Infrastructure Services 28,700 28,770 (70) 0 (70) Totals 44,942 45,012 (70) 0 (70) Year to Date Position Key Financial Successes: At the end of financial year 2021-22 the department showed an overall underspend of £0.574m after taking into account all earmarkings. The main underspends were due to the over-recovery of vacancy savings, additional income in Environmental Health from Private Water Supply Appraisals and additional Planning Fee income which was partially offset by the under-recovery of Building Warrant income. Overall there was a favourable net position. -95% -70% -45% -20% 5% 30% 55% 80% 105% Executive Director (Kirsty Flanagan) Head of Customer Support Services Head of Development and Economic Growth Head of Roads and Infrastructure Services Expenditure to date against the remaining budget for each Service YTD Actual… Remaining Budget £000
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Key Financial Challenges: Proposed Actions to address Financial Challenges: The impact of COVID-19 Costs are being monitored and contained where possible. Department / Service ongoing ability to meet future savings / efficiency requirements. Monitoring of trends / expenditure levels / service configuration and the Service Packages Policy Options savings process. Dangerous buildings costs as there is no budget for this expenditure and the council has no control over the demand for the service. Building Standards, Legal Services and Financial Services are working closely to manage debt recovery and to consider other options to minimise corporate risk exposure. Due to the nature of the various components of Waste Management there are ongoing challenges with: • The introduction of the Deposit Return Scheme • Uncertainty with recycling income/ gate fee costs due to the volatility of the market • Challenges in the legislative changes around the disposal of Biodegradable Municipal Waste To closely monitor all service components of Waste Management and review the Waste Strategy in conjunction with our contractual partner Renewi (previously Shanks). Winter Maintenance costs are difficult to estimate as they are very much dependant on the weather. Close monitoring of Winter Maintenance and reporting of the financial implications through the budget monitoring process. The Council agreed the winter policy, setting out the intervention level and locations to be treated. The number of treatments is determined by weather conditions. The current budget provision provides for 58 full equivalent runs. There is a sophisticated weather monitoring system in place consisting of several weather stations, this is supported by a forecasting and metrological service which is collaboratively procured by West of Scotland local authorities. Rising cost of materials across the service will result in a reduction in activity or overspends. Specifically there have been significant increases in the price of salt and bitumen in recent months. Costs are monitored regularly and contained as much as possible, with any unavoidable overspends highlighted as soon as known.
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EXECUTIVE DIRECTOR (KIRSTY FLANAGAN) – OBJECTIVE SUMMARY AS AT 31 AUGUST 2022 Service Service Area YTD Actual £000 YTD Budget £000 YTD Variance £000 % Variance Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation Executive Director (Kirsty Flanagan) Central/Management Costs 94 94 0 0.0% 125 125 0 0.0% Outwith Reporting Criteria. 94 94 0 0.0% 125 125 0 0.0% Head of Customer Support Services Central/Management Costs 52 55 3 5.5% 165 165 0 0.0% Outwith Reporting Criteria. Head of Customer Support Services Communications 92 93 1 1.1% 285 285 0 0.0% Outwith Reporting Criteria. Head of Customer Support Services Customer Service Centres 479 466 (13) (2.8%) 1,314 1,314 0 0.0% Outwith Reporting Criteria. Head of Customer Support Services HR 756 761 5 0.7% 2,153 2,153 0 0.0% Outwith Reporting Criteria. Head of Customer Support Services ICT 1,500 1,609 109 6.8% 3,950 3,950 0 0.0% One-off income in ICT that will be used to offset a saving later in the year. Head of Customer Support Services Registrars (51) (6) 45 (750.0%) 46 46 0 0.0% Income received ahead of profiled budget, this will be monitored closely in the coming months. 2,828 2,978 150 5.0% 7,913 7,913 0 0.0% Head of Development & Economic Growth Airports 544 503 (41) (8.2%) 1,162 1,162 0 0.0% Outwith Reporting Criteria. Head of Development & Economic Growth Building Control (160) (60) 100 (166.7%) (135) (135) 0 0.0% Building warrant income received ahead of profiled budget, this will be monitored closely in the coming months.
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Head of Development & Economic Growth Central/Management Costs 169 196 27 13.8% 574 574 0 0.0% Budget needs to be profiled in line with anticipated expenditure. Head of Development & Economic Growth Culture & Heritage 90 44 (46) (104.6%) 216 216 0 0.0% Expenditure ahead of budget profile for Events and Festivals. Any overspend will be covered by an earmarked reserve. Head of Development & Economic Growth Development Management (433) 18 451 2505.6% 227 227 0 0.0% Planning Fee income received ahead of profiled budget, this will be monitored closely in the coming months. Head of Development & Economic Growth Development Policy 148 136 (12) (8.8%) 373 373 0 0.0% Outwith Reporting Criteria. Head of Development & Economic Growth Economic Development (201) 691 892 129.1% 1,250 1,250 0 0.0% Income for Islands Infrastructure Fund and Place Based Investment received in advance of payments. Head of Development & Economic Growth Environmental Health 385 436 51 11.7% 1,214 1,214 0 0.0% Appraisal of Water Supplies income ahead of profiled budget, this will be monitored closely in the coming months. Head of Development & Economic Growth Environmental Initiatives 63 42 (21) (50.0%) 114 114 0 0.0% Profile of third party payment. Head of Development & Economic Growth Housing 2,133 1,926 (207) (10.8%) 2,990 2,990 0 0.0% Expenditure payments for HEEPS incurred prior to grant income being received which is partially offset with an underspend in Private Sector Housing Grant payments. Head of Development & Economic Growth Transportation Policy 77 83 6 7.2% 219 219 0 0.0% Outwith Reporting Criteria. 2,815 4,015 1,200 29.9% 8,204 8,204 0 0.0% Head of Roads & Infrastructure Services Amenity 1,629 1,424 (205) (14.4%) 2,800 2,870 (70) (2.5%) Under recovery of income forecasted for both Parks for Hire of Facilities income (£30k) and Pest Control for external income (£40k). The year to date variance includes both of these
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issues alongside a reduction in turnstile income in Public Conveniences which is being closely monitored and update regularly. Head of Roads & Infrastructure Services Car Parking (97) (280) (183) 65.4% (622) (622) 0 0.0% Income received behind profiled budget, this will be monitored closely in the coming months. Head of Roads & Infrastructure Services Central/Management Costs 1,193 1,191 (2) (0.2%) 2,874 2,874 0 0.0% Outwith Reporting Criteria. Head of Roads & Infrastructure Services Depots 128 110 (18) (16.4%) (469) (469) 0 0.0% Rental income slightly behind profiled budget, this should be rectified as we progress through the year. Head of Roads & Infrastructure Services Fleet & Transport 3,388 3,246 (142) (4.4%) 8,510 8,510 0 0.0% Delay in fuel recharge, this will be rectified in the next monitoring period. Head of Roads & Infrastructure Services Infrastructure 198 256 58 22.7% 708 708 0 0.0% Coastal and Flood budget requires to be profiled in line with the anticipated expenditure. Head of Roads & Infrastructure Services Marine (1,504) (2,233) (729) 32.7% (4,371) (4,371) 0 0.0% Grant income budgeted for but not yet received in Ferries and income in Piers & Harbours behind profiled budget, this will be monitored closely in the coming months. Head of Roads & Infrastructure Services Network & Traffic Management 103 25 (78) (312.0%) 141 141 0 0.0% Income currently behind profiled budget, this will be monitored closely in the coming months. Head of Roads & Infrastructure Services Road Safety 35 42 7 16.7% 154 154 0 0.0% Small supplies and Services budget has not yet been spent. Head of Roads & Infrastructure Services Roads & Lighting 3,374 2,057 (1,317) (64.0%) 6,153 6,153 0 0.0% Expenditure for materials and private contractors in the Roads Operational Holding Account higher current profiled budget due to high level of capital expenditure, this will be offset with an increase in income once recharges are processed against capital throughout the year. Head of Roads & Infrastructure Services Waste 3,357 3,401 44 1.3% 12,822 12,822 0 0.0% Outwith Reporting Criteria.
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11,804 9,239 (2,565) (27.8%) 28,700 28,770 (70) (0.2%) 17,541 16,326 (1,215) (7.4%) 44,942 45,012 (70) (0.16%) YTD is year to date and represents the actual or budgeted expenditure and income for the financial year so far. Forecast Outturn is the estimate now of what expenditure or income will be for the whole of the financial year. The Variance is the difference between budget and actual or forecast outturn. A positive variance is when actual or forecast expenditure is less than budget or actual or forecast income is more than budget. A negative variance is shown in brackets and is when actual or forecast expenditure is more than budget or actual or forecast income is less than budget. An explanation is given for any variance which exceeds £50,000 or 10%.
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EXECUTIVE DIRECTOR (KIRSTY FLANAGAN) – SUBJECTIVE SUMMARY AS AT 31 AUGUST 2022 Subjective Category YTD Actual £000 YTD Budget £000 YTD Variance £000 % Variance Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation Employee 12,914 12,945 31 0.2% 35,385 35,385 0 0.0% Outwith Reporting Criteria. Premises 838 812 (26) (3.2%) 2,990 2,990 0 0.0% Outwith Reporting Criteria. Supplies and Services 4,506 3,224 (1,282) (39.8%) 8,046 8,046 0 0.0% Material expenditure in the Roads Operational Holding Account higher than the profiled budget due to high level of capital expenditure, this will be offset with an increase in income as recharges are processed against capital throughout the year. Transport 5,067 4,459 (608) (13.6%) 15,837 15,837 0 0.0% Overspend in Fleet for vehicle repairs and additional external leases which are offset with additional income for recharges to the individual departments and a delay in fuel recharge, this will be rectified in the next monitoring period. Third Party 14,796 13,863 (933) (6.7%) 36,346 36,346 0 0.0% Various grant payments made in Economic Development which are offset against actual income received (£456k). Private contractor expenditure in the Roads Operational Holding Account higher than the profiled budget due to high level of capital expenditure, this will be offset with an increase in income as recharges are processed against capital throughout the year (£531k). HEEPS expenditure against a zero budget which will be offset with additonal income once grant is received (£487k). Capital Financing 0 0 0 0.0% 1,592 1,592 0 0.0% Outwith Reporting Criteria. Income (20,580) (18,977) 1,603 (8.5%) (55,254) (55,184) (70) 0.1% Under recovery of income forecast for both Parks for Hire of Facilities income (£30k) and Pest Control for external income (£40k). The year to date variance mainly due to income for Islands Infrastructure Fund (£740k) and Place Based Investment (£712k) against a zero budget as well as additional Planning Fee income received. Totals 17,541 16,326 (1,215) (7.4%) 44,942 45,012 (70) (0.2%)
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YTD is year to date and represents the actual or budgeted expenditure and income for the financial year so far. Forecast Outturn is the estimate now of what expenditure or income will be for the whole of the financial year. The Variance is the difference between budget and actual or forecast outturn. A positive variance is when actual or forecast expenditure is less than budget or actual or forecast income is more than budget. A negative variance is shown in brackets and is when actual or forecast expenditure is more than budget or actual or forecast income is less than budget. An explanation is given for any variance which exceeds £50,000 or 10%.
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EXECUTIVE DIRECTOR (KIRSTY FLANAGAN) – RED VARIANCES AS AT 31 AUGUST 2022 Service Area Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation A red variance is a forecast variance which is greater than +/- £50,000.
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SOCIAL WORK – AS AT 31 AUGUST 2022 The department is currently forecasting an overspend of £0.021m (0.0%) which is mainly due to high demand for services. The department has a year to date underspend of £0.189m (1.3%). This is mainly due to an over-recovery of vacancy savings. Forecast Outturn Position Service Annual Budget £000 Forecast Outturn £000 Current Forecast Variance £000 Previous Forecast Variance £000 Change £000 Chief Officer Integration 2,510 1,216 1,294 1,061 233 Head of Adult Services 54,780 56,547 (1,767) (1,551) (216) Head of Children and Families 15,178 14,734 444 407 37 Head of Strategic Planning and Performance 443 435 8 8 0 Totals 72,911 72,932 (21) (75) 54 Year to Date Position -25% 0% 25% 50% 75% 100% Chief Officer Integration Head of Adult Services Head of Children and Families Head of Strategic Planning and Performance Expenditure to date against the remaining budget for each Service YTD… Remaining Budget… Key Financial Successes: Delivered an underspend at the end of 2021/22 after automatic earmarkings and full repayment of £2.759m of debt owed to the Council for prior year deficits. This should allow for future investment and transformation across Social Work with prior year deficits now fully repaid.
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Key Financial Challenges: Proposed Actions to address Financial Challenges: Deliver the outstanding savings total for 2022/23 of £1.436m (as at August 2022). Maintain a close working relationship with the HSCP Service Improvement Team in order to quickly and efficiently identify and assess options for delivering the outstanding savings. Development and delivery of future service redesigns which will be necessary to contain service expenditure within the allocated resource in the medium to long term. Support from finance to assist strategic managers to look beyond the short term to identify and plan the changes which will be needed to address the expected ongoing budget challenge over the next 3 to 5 years. Support the HSCP through the recovery from the COVID-19 pandemic. There have been additional costs and pressures across the HSCP as a direct result of the partnership’s response to COVID-19. These costs are captured and reported to the Scottish Government via Mobilisation Plans. Support from finance to assist the service in capturing details of all additional costs associated with the response to COVID-19 to ensure these are included in Scottish Government funding returns. Use of agency staff to support service delivery across Older People services due to recruitment and retention challenges within the service. Year to date spend £0.663m at August 2022. Close working relationship to support costing of a recovery route to stabilise service.
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SOCIAL WORK – OBJECTIVE SUMMARY AS AT 31 AUGUST 2022 Service Service Area YTD Actual £000 YTD Budget £000 YTD Variance £000 % Variance Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation Chief Officer Integration Integration Headquarters 202 216 14 6.5% 446 442 4 0.9% Outwith reporting criteria Chief Officer Integration Social Work Central Support (231) 462 693 150.0% 2,064 774 1,290 62.5% The YTD variance is due to underspends on centrally held funds (£340k) and YTD over-recovery on vacancy savings (£261k) combined with YTD underspends on central repairs and Covid-19 funding (£54k). In addition, there are YTD underspends on Audit Fees as a result of timing of invoices. The forecast underspend reflects forecast underspends on centrally held funds (£800k) combined with forecast over-recovery on vacancy savings (£459k) and additional Covid-19 funding to adjust for lost income from clients (£33k). (29) 678 707 156.5% 2,510 1,216 1,294 63.4% Head of Strategic Planning & Performance Management & Central Costs 154 149 (5) (3.4%) 414 407 7 1.7% Outwith reporting criteria Head of Strategic Planning & Performance Service Development 19 19 0 0.0% 29 28 1 3.4% Outwith reporting criteria 173 168 (5) (3.4%) 443 435 8 5.1% Head of Health and Community Care Management & Central Costs 139 143 4 2.8% 258 241 17 6.6% Outwith reporting criteria Head of Health and Community Care Older People 7,812 7,778 (34) (0.4%) 37,102 37,228 (126) (0.3%) Outwith reporting criteria. The forecast overspend reflects demand for Care Home Placements (£449k) and Respite (£194k). This is partially offset by a forecast underspend across Homecare (£519k) based on
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current known commitments for the service. However, the Homecare underspend of £519k includes a significant forecast overspend on staff costs, including a forecast overspend on Agency Staff costs (£631k). 7,951 7,921 (30) (0.4%) 37,360 37,469 (109) (0.3%) Head of Acute and Complex Care Learning Disabilities 784 134 (650) (485.1%) 12,249 13,660 (1,411) (11.5%) The YTD overspend is due to demand for services within Supported Living. This is partially offset by underspends on staff payroll costs in Day Services and YTD spend on Respite and Residential Placement due to a combination of the impact of rates increases on invoice timing and timing of demand for placements. The forecast overspend reflects higher than budgeted demand for services in Supported Living (£841k) and Joint Residential (£559k). Head of Acute and Complex Care Management & Central Costs 38 48 10 20.8% 125 120 5 4.0% The YTD underspend is as a result of budget profiling on Staff Training costs. Head of Acute and Complex Care Mental Health 130 84 (46) (54.8%) 2,404 2,493 (89) (3.7%) Outwith reporting criteria. The forecast overspend reflects higher than budgeted demand for services in Supported Living (£32k) and Residential Placements (£57k). Head of Acute and Complex Care Physical Disability 720 633 (87) (13.7%) 2,642 2,805 (163) (6.2%) The YTD overspend is due to demand for services within Supported Living partially offset by YTD underspends on Residential Placements due to the impact of rates increases on invoice timing. The forecast overspend reflects higher than budgeted demand for services in Supported Living (£68k), Residential Placements (£78k) and Respite (£19k). 1,672 899 (773) (532.7%) 17,420 19,078 (1,658) (17.4%)
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Head of Children & Families Child Protection 1,035 1,055 20 1.9% 3,307 3,280 27 0.8% Outwith reporting criteria Head of Children & Families Children with a Disability 302 313 11 3.5% 905 894 11 1.2% Outwith reporting criteria Head of Children & Families Criminal Justice 60 108 48 44.4% 88 79 9 10.2% The YTD underspend is as a result of staff turnover and vacancies combined with additional income received for provision of Structured Deferred Sentences and Bail Supervision in 2021/22 (not accrued). The forecast underspend is on payroll costs as a result of staff turnover and vacancies. Head of Children & Families Looked After Children 2,697 2,852 155 5.4% 7,637 7,212 425 5.6% The YTD underspend is due to underspends in Adoption and Fostering due to demand for these services combined with underspends on residential placements and additional income in the Hostels for provision of meals. The forecast underspend reflects demand for Fostering and Adoption services combined with demand for Residential Placements as well as over-recovery of income across Supporting Young People Leaving Care for UASC activity from the Home Office. This is partially offset by overspends in the Children's Houses on payroll costs. Head of Children & Families Management & Central Costs 1,068 1,124 56 5.0% 3,241 3,269 (28) (0.9%) The YTD variance is as a result of staff vacancies which have yet to be transferred to vacancy savings combined with YTD underspends on staff travel. The forecast variance is outwith reporting criteria. 5,162 5,452 290 5.3% 15,178 14,734 444 2.9% GRAND TOTAL 14,929 15,118 189 1.3% 72,911 72,932 (21) (0.0%)
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YTD is year to date and represents the actual or budgeted expenditure and income for the financial year so far. Forecast Outturn is the estimate now of what expenditure or income will be for the whole of the financial year. The Variance is the difference between budget and actual or forecast outturn. A positive variance is when actual or forecast expenditure is less than budget or actual or forecast income is more than budget. A negative variance is shown in brackets and is when actual or forecast expenditure is more than budget or actual or forecast income is less than budget. An explanation is given for any variance which exceeds £50,000 or 10%.
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SOCIAL WORK – SUBJECTIVE SUMMARY AS AT 31 AUGUST 2022 Subjective Category YTD Actual £000 YTD Budget £000 YTD Variance £000 % Variance Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation Employee 11,360 11,394 34 0.3% 30,790 31,007 (217) (0.7%) The YTD underspend is outwith reporting criteria. The forecast overspend is due to overspends in Residential Units (both children and adults) as a result of use of bank staff and Homecare due to use of agency staff. This is partially offset by the forecast over-recovery on vacancy savings (£459k). Premises 361 313 (48) (15.3%) 1,149 1,278 (129) (11.2%) The YTD overspend arises mainly due to overspends on rental charges and refuse collections (due to budget profiling) partially offset by YTD underspends on central repairs costs. The forecast overspend is as a result of Supported Living rental costs in Learning Disability and utility costs at the Hostels. Supplies & Services 813 742 (71) (9.6%) 1,256 1,431 (175) (13.9%) The YTD overspend reflects slippage on the achievement of budget savings. The forecast overspend is mainly due to forecast slippage on budget savings (£119k) combined with overspends on catering purchases, staff subsistence at Tigh a Rudha and cost of prepared meals at Ardfenaig. Transport 204 266 62 23.3% 630 593 37 5.9% The YTD underspend is due to various travel underspends across the service which is to be expected due to the changes to travel habits as a result of Covid-19 and the current level of staffing vacancies across the service. The forecast year end outturn reflects the continued reduction in travel costs across the service and an expectation that different ways of working will continue to reduce future spending on travel. Third Party 19,546 19,398 (148) (0.8%) 61,672 62,461 (789) (1.3%) Both the YTD and forecast full year overspend reflects the higher than budgeted demand for purchased care services in Older People and Learning Disability. Income (17,355) (16,995) 360 (2.1%) (22,586) (23,838) 1,252 (5.5%) Both the YTD and forecast over recovery of income is mainly due to increased income from fees, charges and recharges. Totals 14,929 15,118 189 1.3% 72,911 72,932 (21) (0.0%)
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YTD is year to date and represents the actual or budgeted expenditure and income for the financial year so far. Forecast Outturn is the estimate now of what expenditure or income will be for the whole of the financial year. The Variance is the difference between budget and actual or forecast outturn. A positive variance is when actual or forecast expenditure is less than budget or actual or forecast income is more than budget. A negative variance is shown in brackets and is when actual or forecast expenditure is more than budget or actual or forecast income is less than budget. An explanation is given for any variance which exceeds £50,000 or 10%.
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SOCIAL WORK – RED VARIANCES AS AT 31 AUGUST 2022 Service Area Annual Budget £000 Forecast Outturn £000 Forecast Variance £000 % Variance Explanation Social Work Central Support 2,064 774 1,290 62.5% The forecast underspend reflects forecast underspends on centrally held funds (£800k) combined with forecast over-recovery on vacancy savings (£459k) and additional Covid- 19 funding to adjust for lost income from clients (£33k). Looked After Children 7,637 7,212 425 5.6% The forecast underspend reflects demand for Fostering and Adoption services combined with demand for Residential Placements as well as over-recovery of income across Supporting Young People Leaving Care for UASC activity from the Home Office. This is partially offset by overspends in the Children's Houses on payroll costs Older People 37,102 37,228 (126) (0.3%) The forecast overspend reflects demand for Care Home Placements (£449k) and Respite (£194k). This is partially offset by a forecast underspend across Homecare (£519k) based on current known commitments for the service. However, the Homecare underspend of £519k includes a significant forecast overspend on staff costs, including a forecast overspend on Agency Staff costs (£631k). Physical Disability 2,642 2,805 (163) (6.2%) The forecast overspend reflects higher than budgeted demand for services in Supported Living (£68k), Residential Placements (£78k) and Respite (£19k). Learning Disability 12,249 13,660 (1,411) (11.5%) The forecast overspend reflects higher than budgeted demand for services in Supported Living (£841k) and Joint Residential (£559k). Mental Health 2,404 2,493 (89) (3.7%) The forecast overspend reflects higher than budgeted demand for services in Supported Living (£32k) and Residential Placements (£57k). A red variance is a forecast variance which is greater than +/- £50,000.
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MONITORING OF SAVINGS – AS AT 31 AUGUST 2022 New policy savings were identified for the three year period 2022-23 to 2024-25 and these were agreed by Council in February 2022. Council agreed to policy savings of £0.280m in 2022-23 rising to £0.286m by 2024-25. The position of historical policy saving options is as follows: - 2021/22 – those not delivered or that have further increase in value in 2022-23 onwards total £0.732m - 2020/21 – those not delivered total £0.050m - 2019/20 – all delivered - 2018/19 - those not delivered total £0.498m The 2022-23 savings have been removed from departmental budgets, however, it is important to monitor whether the saving has actually been delivered to ensure that costs are not continuing resulting in an overspend by the end of the year. It is also important to ensure that any preparatory work required to deliver savings in future years is on track. There are four savings categorised as having a potential shortfall and one currently delayed as summarised below: Saving Saving Agreed Status Detail Shortfall/ Delayed Value TB07 – Depots Feb-18 Potential Shortfall - there is a risk that the original saving will not be achieved in full. Create one main depot in key areas to reduce costs – it has become apparent that the operating costs of the single redeveloped site in each town will increase, reducing the anticipated saving. Work ongoing on a depot consolidation scheme in Lochgilphead and work is progressing to outline various funding options for discussion. A project is also underway for Bowmore £107,500 TB13b Roads and Amenity Services charging (non- statutory services) Feb-18 Potential Shortfall - there is a risk that the original saving will not be achieved in full. The original proposal was to introduce charges for providing lighting design and increase charges by 20% for road construction consents, skips, scaffolds, hoarding, permits and licences. Whilst some additional income has been generated through third party works, opportunities are expected to be limited over the foreseeable future due to staff shortages and other competing demands £100,000 TB12b Stadiums Feb-18 Potential Shortfall - there is a risk that the original saving will not be achieved in full. Discussions had stalled with partners in the Oban and Lorn area with regard to Mossfield stadium to create a sports Hub, attract external funding to improve facilities and therefore attract additional events to the arena. The users group has now reconvened and will be reporting to the steering group. It should be noted there is generally a downturn in usage of pitches partly due to more clubs booking all weather pitches at high schools and the loss of a well established club disbanding which will result in the loss of income. £20,000
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DEG05 – Building Standards Feb-20 Potential Shortfall - there is a risk that the original saving will not be achieved in full. Building market has slowed due to the increase in cost and availability of some materials. Reservations that the type of applications we receive may not realise sufficient additional income using the BCIS guide. £50,000 TB09 – Public Conveniences Feb-18 Delayed - The full saving will not be achieved in line with the original estimated timescale. Tender returns have been received significantly over the available budget and work is underway to profile different options to take this scheme forward in whole or in part. £24,000 All policy saving options previously agreed are noted in the table below for information.
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2022-23 2022-23 £000 FTE Chief Executive's Unit FS02 Feb-22 Financial Services Reduction of vacant 0.4FTE Local Tax Assistant role 10.0 0.40 Delivered Executive Director Douglas Hendry PROP01 Feb-21 Commercial Services Rationalisation of the Council's property estate over a three year programme to identify properties which can either be disposed of or used to generate commercial income 294.20 4.0 Still to be Implemented TB17 Feb-18 Commercial Services Identify opportunities for office rationalisation and raising income 121.50 0.0 On Track to be Delivered CS01 Feb-22 Commercial Services Climate Change & Resource Efficiency 63.0 0.00 On Track to be Delivered CS03 Feb-22 Commercial Services Stretch Targets for One Council Income & Events 20.0 0.00 On Track to be Delivered ED5 Feb-21 Education Review and reduce Clerical Support Entitlement using updated school rolls. 121.00 5.7 Delivered ED01 Feb-22 Education Removal of Community Learning Development Manager Post 66.5 1.00 Delivered Executive Director Kirsty Flanagan CSS03 Feb-22 Customer Support Services Restructure of CSP/Registration Team at Helensburgh Civic Centre 19.0 0.50 On Track to be Delivered DEG01 Feb-22 Development and Economic Growth Crown Estate Administration Contribution to Project Delivery 101.0 0.00 On Track to be Delivered DEG05(a) Feb-20 Development and Economic Growth Raise additional fees by adopting the current Building Cost Information Service (BCIS) guide for the cost of building work. Regular service users have been informed of this change. 50.00 0.0 Potential Shortfall DEG02 Feb-21 Development and Economic Growth Reduction to overtime budget in the provision of fire cover at the airports for weather delayed flights. Arrangements are in place that staff no longer remain at the airport and there is a cut-off period. 22.00 0.0 On Track to be Delivered DEG07 Feb-21 Development and Economic Growth Additional income through fees and charges for s64 Non-Material Amendment Submissions, non e-planning application submissions and property history searches 20.00 0.0 Delivered DEG10 Feb-21 Development and Economic Growth Maximise income through additional private water supplies income from risk assessments of supplies and introducing a new charge for the provision of shellfish movement documents 17.50 0.0 Delivered TB07 Feb-18 Roads and Infrastructure Services Create one main depot in key areas to reduce costs 172.50 0.0 Potential Shortfall TB13b Feb-18 Roads and Infrastructure Services Roads & Amenity Services charging (non- statutory services) 150.00 0.00 Potential Shortfall R&I17 Feb-21 Roads and Infrastructure Services Public transport fare scale increase 76.00 0.0 On Track to be Delivered R&I03 Feb-21 Roads and Infrastructure Services Administrative support - rationalise across service 50.00 2.0 On Track to be Delivered R&I05 Feb-21 Roads and Infrastructure Services Design service fees - bringing in line with industry standards and reduce cost of consultancy. Two posts created as a spend to save 50.00 -2.0 On Track to be Delivered R&I09 Feb-21 Roads and Infrastructure Services Road inspections find and fix - reduce reactive work by proactivity. Moving to AI technology as technology develops 40.00 1.0 On Track to be Delivered TB12b Feb-18 Roads and Infrastructure Services Review charges for stadiums to enable improvement work 30.00 0.0 Potential Shortfall R&I04 Feb-21 Roads and Infrastructure Services Fees and charges - commercial waste, TTROs, permits/licenses. Access to debt recovery systems will assist. One post created as a spend to save 25.00 -1.0 On Track to be Delivered TB09 Feb-18 Roads and Infrastructure Services Public Conveniences - Progress sustainable models including turnstiles and franchising; establish simpler asset transfer process 24.00 0.0 Delayed R&I16 Feb-21 Roads and Infrastructure Services Introduce new fees for electric vehicle charging 16.00 0.0 On Track to be Delivered R&I15 Feb-21 Roads and Infrastructure Services Emergency services support and fuel provision from our fuel supplies 0.50 0.0 Still to be Implemented TOTAL 1,559.7 11.6 Status of ImplementationTemplate Ref Saving Agreed Service Savings Option
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ARGYLL AND BUTE COUNCIL FINANCIAL SERVICES POLICY AND RESOURCES COMMITTEE 13 OCTOBER 2022 FINANCIAL RISKS ANALYSIS 2022-23 1 EXECUTIVE SUMMARY 1.1 The main purpose of this report is to provide a summary of the key financial risks facing the Council. 1.2 A number of Council wide risks, both revenue and capital have been identified along with risks for each department and service of the Council. For each departmental risk the financial impact has been quantified and the likelihood assessed based on the standard risk matrix. 1.3 There are 5 Council wide revenue risks identified for 2022-23 currently amounting to £2.058m. 1.4 There are currently 42 departmental risks totalling £5.745m. Of the 42 departmental risks, one is categorised as almost certain and 7 are categorised as likely. 1.5 The financial risks are monitored routinely and actions put in place to continue to mitigate the risks.
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ARGYLL AND BUTE COUNCIL FINANCIAL SERVICES POLICY AND RESOURCES COMMITTEE 13 OCTOBER 2022 FINANCIAL RISKS ANALYSIS 2022-23 2. INTRODUCTION 2.1 This report outlines the process and approach developed in carrying out a financial risks analysis and provides a note of the current assessment of financial risks for 2022-23. 3 DETAIL 3.1 Introduction 3.1.1 The Council is currently in a period of significant financial challenge. In developing its budget to address both restricted resources and cost and demand pressures there are a number of financial risks the Council needs to consider and manage. 3.1.2 There are a number of risks that affect the income or expenditure across the whole council and these have been identified. Financial risks have been considered by each department and service of the Council. 3.1.3 For each risk, the financial impact has been quantified and the likelihood assessed based on the standard risk matrix as follows: 1 – Remote 2 – Unlikely 3 – Possible 4 – Likely 5 – Almost Certain 3.1.4 The Argyll and Bute Integrated Joint Board (IJB) with responsibility for Social Work and a range of Health services was established and came into effect on 1 April 2016. The IJB is responsible for financial and strategic oversight of these services. It is the responsibility of the IJB to consider the individual financial risks associated with Integration Services and they are therefore not contained within this report. A Council wide risk has been included in respect of the IJB being unable to deliver the social care service within the budget allocated. 3.2 Council Wide Risks Revenue 3.2.1 Utility costs remain a volatile area and it is difficult to accurately predict how the prices could vary. The outturn in respect of utilities for 2021-22 was an underspend of £0.310m which was partly due to fixed price contracts that had
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been secured which have now expired. With the volatility of utilities pricing it is very difficult to predict the impact going forward but a financial risk based on a 20% variation in utility costs amounts to £0.706m. 3.2.2 The estimated level of council tax income is based on current and forecast Band D equivalents and non-payment rates. This reflects our most recent experience in terms of the council tax base and likely collection rates. A 1% variation in council tax income amounts to approximately £0.553m. 3.2.3 At the budget meeting on 24 February 2022, the Council agreed 6 new policy savings options that would deliver savings over the period 2022-23 to 2024-25. The savings to be delivered in 2022-23 amount to £0.280m. Whilst the Council have a good track record in delivering savings, a 10% shortfall on this savings target would amount to £0.028m. 3.2.4 In respect of the Health and Social Care Partnership, it is the responsibility of the Chief Officer and Chief Financial Officer to manage the HSCP financial position. If an overspend is forecast, a budget recovery plan will be prepared and submitted to the IJB, the Council and NHS Highland. Where recovery plans are unsuccessful and an overspend occurs at the financial year end, and the HSCP has insufficient reserves to meet the overspend, then the partners will be required to make additional payments to the HSCP. Whilst any additional payments by the Council and NHS Highland will be deducted from future years funding, there is still a financial risk that the Council may have to pay out additional monies in year. As at 31 August 2022, the net HSCP outturn in 2022-23 is estimated to be a £0.521m overspend (£0.021m from Social Work and £0.500m from Health). 3.2.5 There is an ongoing requirement to fund unavoidable inflationary cost increases in areas like fuel, food etc. This has been predominantly caused by the lack of availability of supply of labour and materials as a result of the COVID-19 pandemic, the UK exit from the European Union, Russia’s invasion of Ukraine and sanctions on Russian owned entities. The Bank of England are currently forecasting that inflation will continue to rise until around Quarter 1 of 2023 where after they forecast that it will start to fall. We will continue to closely monitor the situation and update our financial forecasts using the best information available to us. 3.2.6 The Council wide risks are noted within the table below. Description Likelihood Assessed Financial Impact £000 Energy costs increase by 20% greater than anticipated 3 706 1% variation in Council Tax Income 2 553 10% shortfall on Savings Options 2 28 IJB refer to Council for additional funding to deliver social work services 3 21 1% variation of General Inflation Risk 4 750 Total 2,058
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Capital 3.2.7 The finance settlement announcement on 20 December 2021 provided details of the Local Government funding for 2022-23 and there is therefore certainty as to what our funding is in respect of General Capital Grant and the specific capital grants already distributed. 3.2.8 The capital plan for 2022-23 includes an estimate of £1.387m in respect of capital receipts. This is based on an assessment provided by the Special Projects Team in January 2022. A 10% variation equates to £0.139m and this would require to be managed across the capital programme. 3.2.9 3.2.10 3.2.11 General feedback from Scotland Excel and the Project Managers indicates that price increases and uncertainty are being experienced as well as disruptions to the supply chain and longer lead times, particularly in relation to the construction sector and material availability. This can be attributed to a number of factors such as the COVID-19 pandemic, UK exit from the European Union, invasion of Ukraine and sanctions on Russian owned entities to name a few. The increased rate of inflation impacts costs such as energy prices, labour, packaging and transport. These all have an effect on the overall contract price and make it extremely challenging to manage expenditure and the availability of supply. While it has been possible to estimate the impact of these pressures on some projects, and therefore include those projections within the capital monitoring report, for others it has been more difficult and an overspend has not been forecast at this stage but there are likely to be further significant financial impacts not yet reported within the following projects: - Rothesay Pavilion - Harbour Investment Programme - Helensburgh Waterfront Development - Universal Free School Meals 3.2.12 For those liabilities/risks to the capital programme that were known at the start of 2022-23 it was agreed at the budget meeting in February 2022 to use amounts from the Unallocated General Fund, the 2021-22 Revenue Surplus, COVID-19 specific funding and additional borrowing to mitigate these risks. 3.3 Departmental/Service Risks 3.3.1 The detail of each departmental financial risk is included within Appendix 1. The following table provides a summary of the number of risks within each department and likelihood category with the financial impact.
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Department 1 - Remote 2 - Unlikely 3 - Possible 4 - Likely 5 - Almost Certain Total No £000 No £000 No £000 No £000 No £000 No £000 Chief Executive's Unit 1 125 0 0 2 115 0 0 1 500 4 740 Executive Director Douglas Hendry 2 20 7 545 9 870 4 380 0 0 22 1,815 Executive Director Kirsty Flanagan 3 160 3 240 8 1,735 3 1,155 0 0 16 3,240 Total 6 305 10 785 18 2,620 7 1,535 1 500 42 5,745 3.3.2 The current top three risks in terms of the financial impact are noted in the table below. SERVICE TITLE OF RISK DESCRIPTION OF RISK LIKELIHOOD FINANCIAL IMPACT £000 Roads and Infrastructure Services Roads Maintenance - Bridges, Culverts & Sea Defences Extreme localised weather may result in loss of bridge, culvert, road or sea defence. 3 750 Roads and Infrastructure Services Residual Waste H&L and Tiree There is a potential increase to tipping fees and haulage costs for H&L residual waste. The Council’s supplier Barr Environmental (contract to end of 2023) lost a tribunal relating to the underpayment of landfill tax, which may have led to the Council having to source alternatives at a higher cost. Barr appealed the decision which was heard in the Spring and they won the case which should have reduced or eliminated this financial risk. However, the Scottish Government laid an Amendment Order on Friday 1 July 2022 which came into force at 1700 on 1 July which indicates that Landfill tax will be due on materials previously not chargeable and we have now received notification of an increase in the cost which officers are currently assessing 4 655 Financial Services Council Tax Debt Collection Recovery Recovery of debt becomes more difficult to pursue in the current economic climate. This is in relation to historical debt that has accumulated over many years therefore any adverse collection rates will impact on the year end debt provision as opposed to the in- year financial position, hence no forecast variance has been reported within the current year. 5 500
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3.3.3 The other risks classified as likely are: SERVICE TITLE OF RISK DESCRIPTION OF RISK LIKELIHOOD FINANCIAL IMPACT £000 Roads and Infrastructure Services Roads Materials - Bitumen Increased cost of asphalt material due to price of crude oil rising. Discussions emerging from the industry about possible rationing of bitumen which, if applied, will affect our programmes due to availability 4 400 Commercial Services Catering Costs – Changes to Food and Drink in Schools Standards The Scottish Government reviewed the regulations that govern the food and drinks currently provided in schools. The proposed changes were published in June 2019 and were implemented from Easter 2021. The revised standards focus on reducing sugar, reducing red and red processed meat and increasing fibre. Thus far, there has been an increase in costs and a reduction in demand for school meals. 4 150 Commercial Services Catering Purchases Increased supplier charges. This estimate does not include the additional risk to food costs and uptake from the changes to food and drink standards in schools. 4 100 Legal and Regulatory Support Contract RPI for NPDO and Hub Schools Increase in RPI would result in higher costs. 4 100 Roads and Infrastructure Services Street Lighting Age of lighting stock requires greater maintenance as health and safety becomes a consideration. 4 100 Legal and Regulatory Support Licensing Reduced numbers of licensing applications leading to reduced income. 4 30 3.4 Changes to Financial Risks since last report 3.4.1 There have been three changes to the departmental risks since the financial risks report was presented to the Policy and Resources Committee on 11 August 2022, as follows:
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- The risk in relation to Contract RPI for NPDO and Hub Schools has been upgraded from Unlikely to Likely due to the RPI continuing to increase greatly increasing the likelihood of additional costs. - The risk in relation to Licensing has increased from Possible to Likely due to the ongoing cost of living crisis which could impact the number of licencing applications and reduce income. - The risk in relation to increases in Insurance Costs has been increased from Unlikely to Possible reflecting the impact on the insurance market of COVID-19 and flooding claims. - The likelihood in relation to than one by-election being required outwith the standard election cycle has been increased from Unlikely to Possible to reflect the recent increase of by-elections. - The likelihood and value in relation to planning fee shortfalls has been reduced from Possible to Remote and from £0.100m to £0.050m. This is due to income levels currently looking positive so the risk of under-recovery has reduced. 3.4.2 There has been one change to the council wide risks since the financial risks report was presented to the Policy and Resources Committee on 11 August 2022, as follows: - The risk of an increase in the pay award has been removed as negotiations are at an advanced stage and the current offer is out to ballot. There will definitely be a pressure which will be reported within the budget monitoring reports once it is known. 3.5 Monitoring of Financial Risks 3.5.1 Financial risks will be reviewed and monitored on a two monthly basis and will be included in the pack of financial reports submitted to Policy and Resources Committee. 4 CONCLUSION 4.1 This report summarises the key financial risks facing the Council. There are a number of Council wide risks and 42 departmental risks identified; one is categorised as almost certain and 7 are categorised as likely. The financial risks are monitored routinely and actions put in place to continue to mitigate the risks. 5 IMPLICATIONS 5.1 Policy - None. 5.2 Financial - The financial value of each risk is included within the appendix. 5.3 Legal - None. 5.4 HR - None. 5.5 Fairer Scotland Duty - None. 5.5.1 Equalities – protected characteristics - None. 5.5.2 Socio-economic Duty - None. 5.5.3 Islands - None.
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5.6 Climate Change - None. 5.7 Risk - Financial risks are detailed within the appendix. 5.8 Customer Service - None. Kirsty Flanagan Section 95 Officer 9 September 2022 Policy Lead for Finance and Commercial Services - Councillor Gary Mulvaney APPENDICES Appendix 1 – Detail of Department/Service financial risks For further information contact Anne Blue, Head of Financial Services anne.blue@argyll-bute.gov.uk
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APPENDIX 1 DEPARTMENT/SERVICE FINANCIAL RISKS AS AT 31 AUGUST 2022 DEPARTMENT SERVICE TITLE OF RISK DESCRIPTION OF RISK MITIGATING ACTIONS IN PLACE LIKELIHOOD FINANCIAL IMPACT £000 LIKELIHOOD FINANCIAL IMPACT £000 Chief Executive's Unit Financial Services Council Tax Debt Collection Recovery Recovery of debt becomes more difficult to pursue in the current economic climate. This is in relation to historical debt that has accumulated over many years therefore any adverse collection rates will impact on the year end debt provision as opposed to the in-year financial position, hence no forecast variance has been reported within the current year. Robust monitoring of arrangements with debt collection agency and performance against target collection rates. 5 500 5 500 Chief Executive's Unit Financial Services Housing Benefit Subsidy Loss of Housing Benefit Subsidy due to exceeding LA error threshold. Processes in place for handling of claims accurately and efficiently. 1 125 1 125 Chief Executive's Unit Financial Services Sundry Debt Recovery Recovery of debt becomes more difficult to pursue in the current economic climate. Robust monitoring of arrangements with debt collection agency. Joint working with Legal Services to assist services with the recovery of aged debt. 3 85 3 85 Chief Executive's Unit Financial Services Non-Domestic Rates Relief Risk of demand changing due to legislative changes outwith our control or new charitable businesses. Outwith direct management control. 3 30 3 30 Executive Director Douglas Hendry Commercial Services Property - Central Repairs Increased demands on central repairs as a result of the decrease in capital funding available and increases in supplier/contractor charges. Joint strategy with procurement colleagues to reduce potential impact of supplier/contractor charges. Close monitoring of central repairs budgets and commitments and instructing only essential repairs. 3 300 3 300 Executive Director Douglas Hendry Commercial Services Catering Costs – Changes to Food and Drink in Schools Standards The Scottish Government reviewed the regulations that govern the food and drinks currently provided in schools. The proposed changes were published in June 2019 and were implemented from Easter 2021. The revised standards focus on reducing sugar, reducing red and red processed meat and increasing fibre. Thus far, there has been an increase in costs and a reduction in demand for school meals. There is a need to work with Education colleagues to ensure the maximum uptake of school meals in secondary schools is achieved. This is very challenging given the reduction in secondary school meal uptake due to COVID. 4 150 4 150 Executive Director Douglas Hendry Commercial Services Catering Costs - Provision of Meals to Early Years Children The Children and Young People (Scotland) Act places duties on Councils to provide meals in an Early Years setting to entitled children where sessions span over lunch time. The total quantum of funding of £1.2m may not be sufficient to fund the additional costs depending on uptake and the additional costs to support the meal provision in partner provider settings. Joint strategy with Education colleagues to implement requirements and closely monitor financial implications. Costs likely to be contained within overall early years funding allocation. 2 100 2 100 Executive Director Douglas Hendry Commercial Services Catering Purchases Increased supplier charges. This estimate does not include the additional risk to food cost and uptake from the changes to food and drink standards in schools. Joint strategy with procurement colleagues to reduce potential impact. Control food wastage/portion controls. 4 100 4 100 As at 30 June 2022 As at 31 August 2022
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APPENDIX 1 DEPARTMENT/SERVICE FINANCIAL RISKS AS AT 31 AUGUST 2022 DEPARTMENT SERVICE TITLE OF RISK DESCRIPTION OF RISK MITIGATING ACTIONS IN PLACE LIKELIHOOD FINANCIAL IMPACT £000 LIKELIHOOD FINANCIAL IMPACT £000 As at 30 June 2022 As at 31 August 2022 Executive Director Douglas Hendry Commercial Services Catering - Implementation of Universal Free School Meals in Primary Schools The Scottish Government may not give the local authority adequate funds to support the policy Catering Manager sits on National Operational Delivery Group 2 100 2 100 Executive Director Douglas Hendry Commercial Services Surplus Properties Ongoing market difficulties lead to increased numbers of surplus properties, there are residual running costs associated with surplus properties. One Council property team now in place. 3 50 3 50 Executive Director Douglas Hendry Commercial Services Leisure Service Level Agreements Increase in RPI resulting in requests for additional funding. Monitoring annual alteration to contract RPI rate and mitigation through financial forecasting and review of existing budget. 2 25 2 25 Executive Director Douglas Hendry Commercial Services Rental Income from Properties Due to current economic climate there may be reduced ability to recover rental income from leased properties or place suitable tenants in properties as leases come to an end. Management of leasehold properties by Estates team, any issues with debt recovery being dealt with in line with Council debt recovery policy. 2 20 2 20 Executive Director Douglas Hendry Education Central Repairs Increased demands on budget as a result of increase in statutory and emergency repairs and increases in supplier/contractor charges. Regular liaison with Property Services re prioritisation and commitment of in-year spend. 2 100 2 100 Executive Director Douglas Hendry Education ASN Support Demand for ASN support continues to increase, resulting in an additional resource requirement. The effect of COVID-19 has further increased demand on this service. Scottish Government has given additional funding for "additional support needs priority for learning" and this has been built into the budget, this will help reduce the demand risk 3 100 3 100 Executive Director Douglas Hendry Education Pre-Five Units - retention of partner providers Failure in the commissioning or retention of pre- five partner provider units to deliver 1140 hours would result in an increased pressure on the Council to deliver the service. Annual financial appraisal; Support network; Short-term cash injections. 3 100 3 100 Executive Director Douglas Hendry Education Legislative Requirements - Children and Young People (Scotland) Act - ELC 1140 hours The Council has been required to deliver 1140 hours of Early Learning and Childcare since August 2021. The Scottish Government has committed to funding this and the Council has altered the implementation plan to align it to the Scottish Government funding profile. A risk remains that actual costs of delivery exceed the Government Grant in any given year. For example, if child numbers are higher than estimated, this may require additional staffing which has not been built into the staffing model funded by Scottish Government. Continuous monitoring and review of the implementation plan, usage and resources. 3 100 3 100
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APPENDIX 1 DEPARTMENT/SERVICE FINANCIAL RISKS AS AT 31 AUGUST 2022 DEPARTMENT SERVICE TITLE OF RISK DESCRIPTION OF RISK MITIGATING ACTIONS IN PLACE LIKELIHOOD FINANCIAL IMPACT £000 LIKELIHOOD FINANCIAL IMPACT £000 As at 30 June 2022 As at 31 August 2022 Executive Director Douglas Hendry Education Legislative Requirements - Education (Scotland) Act Education (Scotland) Act 2000 was enacted March 2016. This places additional requirements on Councils to carry out assessments of the need for the provision of Gaelic Medium Primary Education (GMPE) and the duty to support and promote Gaelic Education. May lead to additional staffing requirements. Monitoring developments of the implementation of the Act and statutory guidance produced and adhered too. 3 50 3 50 Executive Director Douglas Hendry Legal and Regulatory Support Hub DBDA/DBFM Schools - Litigation Increased risk of the requirement to litigate to conclude final capital contract payments due. Monitoring claims and mitigation through robust challenge of any additional claims. 2 150 2 150 Executive Director Douglas Hendry Legal and Regulatory Support Contract RPI for NPDO and Hub Schools Increase in RPI would result in higher costs. Monitoring annual alteration to contract RPI rate and mitigation through financial forecasting and review of existing budget. 2 100 4 100 Executive Director Douglas Hendry Legal and Regulatory Support NPDO - Reduction in insurance savings within NPDO Schools Increase in insurance costs as a result of Covid- 19 and flood claims. Monitoring annual alteration to contract insurance rate and mitigation through financial forecasting and review of existing budget. 2 75 3 75 Executive Director Douglas Hendry Legal and Regulatory Support Legal Services - Litigation Increased number of litigation cases. Ensure Legal Services are gateway to access all legal advice and that advice is sought at earliest opportunity. 3 50 3 50 Executive Director Douglas Hendry Legal and Regulatory Support NPDO/Hub DBFM contract management efficiencies Reduction in ability to generate contract management efficiencies. Monitoring annual efficiencies generated and mitigation through robust contract management and application of contract specifications/requirements. 2 50 2 50 Executive Director Douglas Hendry Legal and Regulatory Support Elections More than 1 by-election required outwith standard election cycle. Outwith direct management control. 2 45 3 45 Executive Director Douglas Hendry Legal and Regulatory Support Licensing Reduced numbers of licensing applications leading to reduced income. Monitoring of trends and reporting the financial impact in the budget monitoring. 3 30 4 30 Executive Director Douglas Hendry Legal and Regulatory Support Children's Panel Increased number of referrals increasing costs through increases in the running costs. Maximise the use of council facilities/resources for panel session in the first instance. 1 10 1 10 Executive Director Douglas Hendry Legal and Regulatory Support Legal Services Failure to minimise Council wide use of external legal advice. Ensure legal services are gateway to access all legal advice. 1 10 1 10 Executive Director Kirsty Flanagan Customer Support Services Software Licences Potential risk of being under licensed for software which will be identified via software audits which would incur additional costs. ICT security and compliance officer in post and duties include review of systems to ensure fully licenced. 2 100 2 100 Executive Director Kirsty Flanagan Development and Economic Growth Environmental Health- export certificates Downturn in requests for export certificates as a result of UK withdrawal from EU, changes to international trading agreements or business economy. Reduction in demand creates a budget pressure on environmental health budget. Monitor income and resources required for export health certificates/attestations required to support the export market. Continue with food safety regulation activities associated and support at 3rd country audits. Pursue debt rigorously with key customers through seeking regular payments. 2 130 2 130
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APPENDIX 1 DEPARTMENT/SERVICE FINANCIAL RISKS AS AT 31 AUGUST 2022 DEPARTMENT SERVICE TITLE OF RISK DESCRIPTION OF RISK MITIGATING ACTIONS IN PLACE LIKELIHOOD FINANCIAL IMPACT £000 LIKELIHOOD FINANCIAL IMPACT £000 As at 30 June 2022 As at 31 August 2022 Executive Director Kirsty Flanagan Development and Economic Growth Dangerous Buildings interventions Building Standards having to deal with an increasing level of dangerous building work which has significant financial implications for Council. Monitor activity and seek to recover costs from the owner. 3 100 3 100 Executive Director Kirsty Flanagan Development and Economic Growth Planning fees reduced by Scottish Government Scottish Government reducing planning fees due to poor performance by the Planning Authority. Details of national Planning Performance Co- ordinator and Fee Reform still awaited. Maintain high levels of performance as articulated by performance markers detailed in Planning Performance Framework annual report. 1 100 1 100 Executive Director Kirsty Flanagan Development and Economic Growth Planning fee shortfalls Due to downturn in economic / building activity, in particular renewable energy development and other major developments could lead to planning fee income shortfalls leading to revenue budget pressures. Current income levels are looking more positive, however, we are dependent on some high value applications coming in which if don't materialise, will impact the overall position. Will continue to monitor Development Management income and expenditure tightly and investigate further income generation streams. 3 100 1 50 Executive Director Kirsty Flanagan Development and Economic Growth Building Warrant fee shortfalls Due to loss of commercial income and downturn in economic / building activity, building warrant fee income shortfalls leading to revenue budget pressures. Continue to monitor Building Standards income and expenditure tightly and investigate further income generation streams. 3 100 3 100 Executive Director Kirsty Flanagan Development and Economic Growth Homelessness Temporary Accommodation Income Unpredictable number of Homeless applications. Inability to recover rent. Increase costs of property maintenance and tenancy change over. Provision of Housing Options information and advice service to minimise number of applicants proceeding to full homeless application. Implementation of Rapid Rehousing Plan. 3 50 3 50 Executive Director Kirsty Flanagan Development and Economic Growth Animal Health Carrying out livestock seizure to protect welfare of the animals Monitor activity and seek to recover costs from the disposal of the animals. 1 10 1 10 Executive Director Kirsty Flanagan Development and Economic Growth Airfields and Air Services - usage The PSO for the existing air service to Coll and Colonsay operating from Connel Airport is due for renewal in October 2023. Possibility that this will create a budget pressure for a new contract to be established to serve the needs of the island communities. Tenders have been received and are currently at the evaluation process with Procurement. Once this process is complete, a more definitive position will be known. 2 10 2 10 Executive Director Kirsty Flanagan Roads and Infrastructure Services Roads Maintenance - Bridges, Culverts & Sea Defences Extreme localised weather may result in loss of bridge, culvert, road or sea defence. The recent storm damage to Bute Sea Wall is likely to cost in excess of £1m to repair so the value on this risk has been updated for 22-23 in recognition of the potential costs associated with this risk Routine inspections to deal with potential weak areas - based on a stitch in time repair regime. 3 750 3 750
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APPENDIX 1 DEPARTMENT/SERVICE FINANCIAL RISKS AS AT 31 AUGUST 2022 DEPARTMENT SERVICE TITLE OF RISK DESCRIPTION OF RISK MITIGATING ACTIONS IN PLACE LIKELIHOOD FINANCIAL IMPACT £000 LIKELIHOOD FINANCIAL IMPACT £000 As at 30 June 2022 As at 31 August 2022 Executive Director Kirsty Flanagan Roads and Infrastructure Services Residual Waste H&L and Tiree There is a potential increase to tipping fees and haulage costs for H&L residual waste. The Council’s supplier Barr Environmental (contract to end of 2023) lost a tribunal relating to the underpayment of landfill tax, which may have led to the Council having to source alternatives at a higher cost. Barr appealed the decision which was heard in the Spring and they won the case which should have reduced or eliminated this financial risk. However, the Scottish Government laid an Amendment Order on Friday 1 July 2022 which came into force at 1700 on 1 July which indicates that Landfill tax will be due on materials previously not chargeable and we have now received notification of an increase in the cost which officers are currently assessing Officers currently assessing the potential impact on the Council. 4 655 4 655 Executive Director Kirsty Flanagan Roads and Infrastructure Services Roads Materials - Bitumen Increased cost of asphalt material due to price of crude oil rising. Discussions emerging from the industry about possible rationing of bitumen which, if applied, will affect our programmes due to availability Increased costs are currently being managed but with further increases likely, this is being closely monitored by managers to evaluate the impact. 4 400 4 400 Executive Director Kirsty Flanagan Roads and Infrastructure Services Winter Maintenance Adverse weather conditions which require greater than budgeted number of gritting runs. Monitor weather conditions and apply gritting policy to minimise costs. 3 365 3 365 Executive Director Kirsty Flanagan Roads and Infrastructure Services Roads Maintenance - Roads Network Adverse weather conditions result in deterioration of the road network necessitating greater spend on repair of defects. Manage maintenance budgets to ensure that spend is prioritised to deal with safety defects. 3 230 3 230 Executive Director Kirsty Flanagan Roads and Infrastructure Services Street Lighting Age of lighting stock requires greater maintenance as health and safety becomes a consideration. Manage maintenance budgets to ensure that spend is prioritised to deal with safety defects. 4 100 4 100 Executive Director Kirsty Flanagan Roads and Infrastructure Services Ferry Services - income Changes to ferry services resulting in reduced passenger income. Closely monitor passenger number information coming from CalMac to identify any emerging trends with reducing passenger numbers. 3 40 3 40 42 5,795 42 5,745
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ARGYLL AND BUTE COUNCIL POLICY & RESOURCES COMMITTEE FINANCIAL SERVICES 13 OCTOBER 2022 CAPITAL BUDGET MONITORING REPORT – 31 AUGUST 2022 1.0 EXECUTIVE SUMMARY 1.1 This report provides an update on the position of the capital budget as at 31 August 2022. The report provides information on the financial position in respect of the capital plan and also the performance in terms of delivery of capital plan projects. 1.2 Financial Position: Current Year to Date – actual net expenditure to date is £10,954k compared to a budget for the year to date of £10,857k giving rise to an overspend for the year to date of £97k (0.9%). Forecast Outturn for 2022-23 – forecast net expenditure for the full financial year is £47,714k compared to an annual budget of £48,260k giving rise to a forecast underspend for the year of £546k (1.13%). Total Capital Plan – forecast total net project costs on the total capital plan are £178,745k compared to a total budget for all projects of £178,526k giving rise to a forecast overspend for the overall capital plan of £219k (0.12%). 1.3 Project Delivery: Asset Sustainability – Out of 92 projects there are 88 projects (96%) on track, 4 projects (4%) off track but recoverable and 0 projects off track (0%). Service Development - Out of 41 projects there are 34 projects (83%) on track, 6 projects (15%) off track but recoverable and 1 project (2%) off track. Strategic Change – Out of 27 projects there are 25 projects (93%) on track, 1 project (4%) off track but recoverable and 1 project (4%) off track. 1.4 1.5 The Capital Programme is funded by various income streams as detailed in Appendix 5. Additional funding allocated since the last report has come from earmarked reserves for Gartbreck Landfill Site. The Council is projecting £1,387k of capital receipts this financial year. To date, no receipts have been received and we are anticipating that we will not receive the full amount budgeted for 2022-23, however, this appears to be a delay rather than a permanent reduction and over the life of the entire capital programme there is no overall impact. This will be closely monitored throughout the year.
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ARGYLL AND BUTE COUNCIL POLICY & RESOURCES COMMITTEE FINANCIAL SERVICES 13 OCTOBER 2022 CAPITAL BUDGET MONITORING REPORT – 31 AUGUST 2022 2.0 INTRODUCTION 2.1 2.2 2.3 2.4 2.5 This report provides an update on the position of the capital budget as at 31 August 2022. The report provides information on the financial position in respect of the capital plan and also the performance in terms of delivery of capital plan projects. Following the decision at Policy and Resources Committee on 9 December 2021, the Rothesay Pavilion project is on pause whilst potential funding options are being considered. The financial information included within this report therefore excludes amounts relating to Rothesay Pavilion. A £1m cost pressure was identified during 2021-22 in relation to repairs to the A884 Ardbeg Sea Wall, where severe storm damage resulted in failure of the sea wall on Bute. Emergency works were carried out and a permanent solution is currently being developed. Additional funding of £1m was allocated for this purpose at the Council meeting on 24 February 2022 however there remains a risk that costs will exceed this. It was agreed at Environment, Development and Infrastructure Committee on 2 June 2022 that the Chair would approach the Scottish Government with a view to securing additional resources to support the scheme. Project Managers were asked to identify specific Covid-19 impacts on the capital programme. At the budget meeting on 25 February 2021, the Council agreed to provide £2.5m of funding and following agreement at the Policy and Resources Committee on 14 October 2021, this, plus a further £0.146m, was added to the capital programme. Furthermore, at the budget meeting on 24 February 2022, an additional £3.9m was set aside for future capital contract increases. This includes up to £1.2m for Campbeltown Flood Scheme, the final costs of which are estimated to be £15.215m. The Scottish Government will fund 80% of scheme costs with the Council expected to contribute an estimated £3.043m. The impact of the pandemic along with the UK exit from the European Union, the Russian invasion of Ukraine and sanctions on Russian owned entities has seen significant price increases as well as disruptions to the supply chain and longer lead in times. The increased rate of inflation impacts costs such as energy prices, labour, packaging and transport. These all have an effect on the overall contract price and make it extremely challenging to manage expenditure and the availability of supply. As a result of this it should be noted that there are likely to be other significant financial impacts which are not quantifiable at this stage, as follows: Rothesay Pavilion – project currently paused due to increased costs as a result of the main contractor being placed into administration in March 2020.
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4.0 CURRENT YEAR TO DATE FINANCIAL POSITION 4.1 4.2 Overall Position Actual net expenditure to date is £10,954k compared to a budget for the year to date of £10,857k giving rise to an overspend for the year to date of £97k (0.9%). Project/Department Position The table below shows the year to date net expenditure against the year to date budget by project type and service: Project Type: Year to Date Budget £'000 Year to Date Actual £'000 Variance £'000 Asset Sustainability 6,284 6,392 (108) Service Development 1,240 1,225 15 Strategic Change 3,333 3,337 (4) Total 10,857 10,954 (97) Service: ICT 569 569 0 Education 2,296 2,258 38 Live Argyll 82 141 (59) Health & Social Care Partnership 75 124 (49) Shared Offices 44 44 0 Roads & Infrastructure 4,427 4,450 (23) Development & Economic Growth 577 577 0 CHORD 2,787 2,791 (4) Total 10,857 10,954 (97) Material variances are explained in Appendix 1 and there are a number of small variances contributing to the year to date overspend. Harbour Investment Programme – likely to be contractual cost increases in future years (expected to be funded from increased fees and charges). Helensburgh Waterfront Development – commercial negotiations are ongoing with the main contractor to determine the financial impact. Universal Free School Meals – delayed roll out to P6 and P7 and uncertain capital funding levels available from Scottish Government (delay not mentioned as part of Resource Spending Review). Other general construction inflationary increases. 3.0 RECOMMENDATIONS 3.1 Note the contents of this report and the financial summaries as detailed in Appendix 8 and approve the proposed changes to the capital plan detailed in Appendix 4.
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5.0 FORECAST OUTTURN 2022-23 5.1 Overall Position Forecast net expenditure for the full financial year is £47,714k compared to an annual budget of £48,260k giving rise to a forecast underspend for the year of £546k (1.13%). 5.2 Project/Department Position The table below shows the forecast expenditure and budget for the year by project type and service. Project Type: Annual Budget £'000 Forecast Outturn £'000 Forecast Variance COVID- 19 Related £'000 Forecast Variance Non COVID- 19 Related £'000 Forecast Variance £'000 Asset Sustainability 27,240 27,376 0 (136) (136) Service Development 4,848 4,700 0 148 148 Strategic Change 16,172 15,638 0 534 534 Total 48,260 47,714 0 546 546 Service: ICT 1,367 1,367 0 0 0 Education 6,097 6,135 0 (38) (38) Live Argyll 1,208 1,280 0 (72) (72) Health & Social Care Partnership 2,107 2,158 0 (51) (51) Shared Offices 4,197 4,213 0 (16) (16) Roads & Infrastructure 26,595 26,631 0 (36) (36) Development & Economic Growth 2,770 2,011 0 759 759 CHORD 3,919 3,919 0 0 0 Total 48,260 47,714 0 546 546 Material variances are explained in Appendix 2 and there are a number of smaller variances contributing to the forecast overspend.
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6.0 TOTAL PROJECT COSTS 6.1 Overall Position Forecast total net project costs on the total capital plan are £178,745k compared to a total budget for all projects of £178,526k giving rise to a forecast overspend for the overall capital plan of £219k (0.12%). 6.2 Project/Department Position The table below shows the forecast expenditure and budget for the total capital plan by project type and service. Project Type: Capital Plan Budget £'000 Forecast Project Costs £'000 Capital Plan Variance COVID-19 Related £'000 Capital Plan Variance Non COVID-19 Related £'000 Total Capital Plan Variance £'000 Asset Sustainability 51,084 51,225 0 (141) (141) Service Development 19,337 19,399 0 (62) (62) Strategic Change 108,105 108,121 0 (16) (16) Total 178,526 178,745 0 (219) (219) Service: ICT 5,007 5,007 0 0 0 Education 41,833 41,871 0 (38) (38) Live Argyll 3,368 3,445 0 (77) (77) Health & Social Care Partnership 4,222 4,273 0 (51) (51) Shared Offices 21,507 21,523 0 (16) (16) Roads & Infrastructure 54,017 54,053 0 (36) (36) Development & Economic Growth 4,734 4,735 0 (1) (1) CHORD 43,838 43,838 0 0 0 Total 178,526 178,745 0 (219) (219) Material variances are explained in Appendix 3 and there are a number of smaller variances leading to the forecast overspend.
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7.0 TOTAL PROJECT PERFORMANCE 7.1 Overall Position There are 160 projects within the Capital Plan, 147 are Complete or On Target, 11 are Off Target and Recoverable and 2 are Off Track. 7.2 Project Position The table below shows the Performance Status of the Projects in the Capital Plan. Project Type: Complete / On Target Off Target/ Recoverable Off Target/ Problem Total Asset Sustainability 88 4 0 92 Service Development 34 6 1 41 Strategic Change 25 1 1 27 Total 147 11 2 160 Service: ICT 7 0 0 7 Education 29 1 0 30 Live Argyll 25 3 0 28 Health & Social Care Partnership 16 2 0 18 Shared Offices 21 0 0 21 Roads & Infrastructure 31 4 0 35 Development & Economic Growth 14 0 2 16 CHORD 4 1 0 5 Total 147 11 2 160
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7.3 Chart of Performance Status The graph provides a view of the Performance Status of the Projects included in the Capital Plan: 0 10 20 30 40 50 60 70 80 90 100 Asset Sustainability Service Development Strategic Change Number Off Target/ Problem Off Target/ Recoverable Complete/ On Target
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8.0 OFF TRACK PROJECTS 8.1 9.0 9.1 The Off Track projects are noted in the table below and variance reports are included in Appendix 6. Project Type Project What is Off Track? Explanation Service Development Ardrishaig North Active Travel Current Year Expenditure Contract awarded later than expected due to delays in receiving required documentation and delay in contractor to deploy on site resulting in a delay to expenditure profile. Expenditure has slipped from 2022-23 into 2023-24. Service Development TIF - Halfway House Roundabout Current Year Expenditure Delays with Planning Applications and ongoing discussions with Scottish Government have resulted in delays in progressing the project and expenditure. Expenditure has slipped from 2022-23 into 2023-24. STRATEGIC CHANGE PROJECTS Appendix 7 gives detailed information in respect of the Strategic Change Projects within the Capital Plan. The appendix gives details of the forecast cost of each project against the approved budget, the start and anticipated completion date of the project and an assessment of the risks of the project and, if these are not green, gives an explanation of the problem.
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10.0 CHANGES TO CAPITAL PLAN 10.1 The table below shows proposed changes to the Capital Plan at summary level which include slippages, accelerations and virements. Explanations relating to the specific projects involved can be seen in Appendix 4. The updated capital plan incorporating these proposed changes can be found in Appendix 9. Department Prev. Agreed Changes 2022-23 2022- 23 2023- 24 2024- 25 Future Years Total Capital Plan £’000 £’000 £’000 £’000 £’000 £’000 Asset Sustainability 73 0 0 0 0 0 Service Development (151) (210) 210 0 0 0 Strategic Change (19,370) (550) 550 0 0 0 Total (19,448) (760) 760 0 0 0 Service: ICT (151) 0 0 0 0 0 Education 0 0 0 0 0 0 Live Argyll (27) 0 0 0 0 0 Health & Social Care Partnership 0 0 0 0 0 0 Shared Offices 100 0 0 0 0 0 Roads & Infrastructure (19,370) 0 0 0 0 0 Development & Economic Growth 0 (760) 760 0 0 0 Major Projects 0 0 0 0 0 0 Total (19,448) (760) 760 0 0 0 11.0 FUNDING 11.1 11.2 The Capital Programme is funded by various income streams as detailed in Appendix 5. Additional funding allocated since the last report has come from earmarked reserves for Gartbreck Landfill Site. The Council is projecting £1,387k of capital receipts this financial year. At this early stage in the year no receipts have been received but this will be closely monitored throughout the year and any issues highlighted.
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12.0 12.1 12.2 12.3 12.4 12.5 12.6 12.7 12.8 IMPLICATIONS Policy – Monitors progress against the capital plan. Financial – Monitors funding and commitments of the capital plan. Legal – Available funding may not address all Statutory and Regulatory requirements in relation to Health and Safety. HR – Available funding may have an impact on the sustainability of the Property Design Team and Infrastructure Design Team. Fairer Scotland Duty – None. 12.5.1 Equalities – protected characteristics – None. 12.5.2 Socio-economic Duty – None. 12.5.3 Islands – None. Climate Change – The Council is committed to addressing climate change via projects within the capital plan. Risk – There are risks around increasing capital contract costs and the level and timing of capital receipts. Customer Service – None. Kirsty Flanagan Executive Director / Section 95 Officer 4 October 2022 Policy Lead for Finance and Commercial Services – Councillor Gary Mulvaney For further information contact: Anne Blue, Head of Financial Services APPENDICES - Appendix 1 – Year To Date finance variance explanations - Appendix 2 – Forecast Outturn variance explanations - Appendix 3 – Total Project finance variance explanations - Appendix 4 – Changes to Capital Plan and Financial Impact - Appendix 5 – Capital Funding - Appendix 6 - Off Track project variance reports - Appendix 7 - Cumulative spend, completion dates and risks relating to significant capital projects. - Appendix 8 - Financial Summary – Overall - Financial Summary – Executive Director Kirsty Flanagan - Financial Summary – Executive Director Douglas Hendry - Appendix 9 - Updated/Revised Capital Plan
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APPENDIX 1 – Year to Date Financial Variance Explanations Listed below are the projects where the variance is +/- £50k. Project YTD Budget £’000 YTD Actual £’000 (Over)/ Under Variance £’000 Explanation No variances +/-£50k for this report. Other variances under £50k (97) Total value of non-material variances less than +/-£50k Total (97)
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APPENDIX 2 – Outturn Variance Explanations Listed below are the projects where the current year variance is +/- £50k. Project Annual Budget £’000 Outturn £’000 (Over)/ Under Forecast Variance COVID-19 Related £’000 (Over)/ Under Forecast Variance Non COVID-19 Related £’000 Total (Over)/ Under Forecast Variance £’000 Explanation Ardrishaig North Active Travel 880 670 0 210 210 Contract awarded later than expected due to delays in receiving required documentation and delay in contractor to deploy on site resulting in a delay to expenditure profile. Expenditure has slipped from 2022-23 into 2023-24 TIF - Halfway House Roundabout 597 47 0 550 550 Delays with Planning Applications and ongoing discussions with Scottish Government have resulted in delays in progressing the project and expenditure. Expenditure has slipped from 2022- 23 into 2023-24 Other variances under £50k 0 (214) (214) Total value of non-material variances less than +/- £50k. Total 0 546 546
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APPENDIX 3 – Total Project Finance Variances Listed below are the projects where the total project variance is +/- £50k. Project Capital Plan Budget £’000 Forecast Project Costs £’000 (Over)/ Under Forecast Variance COVID-19 Related £’000 (Over)/ Under Forecast Variance Non COVID-19 Related £’000 Total (Over)/ Under Forecast Variance £’000 Explanation No variances +/-£50k for this report. Other variances under £50k (219) (219) Total value of non-material variances less than +/- £50k. Project Managers are working to reduce these small individual overspends by identifying underspends elsewhere within the capital plan. Total (219) (219)
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APPENDIX 4 – Changes to Capital Plan and Financial Impact OVERALL COST CHANGES Project 2022- 23 £’000 2023- 24 £’000 2024- 25 £’000 Future Years £’000 Total Capital Plan £’000 Recommendation Explanation No overall cost changes this reporting period. Total Cost Changes 0 0 0 0 0 SLIPPAGES AND ACCELERATIONS Project 2022-23 £’000 2023-24 £’000 2024-25 £’000 Future Years £’000 2022-23 Slippage Related to COVID-19 £’000 2022-23 Slippage Related to Non COVID-19 £’000 Total 2022- 23 £’000 Recommendation Explanation Ardrishaig North Active Travel (210) 210 0 0 0 (210) (210) Slip budget into future years. Contract awarded later than expected due to delays in receiving required documentation and delay in contractor to deploy on site resulting in a delay to expenditure profile. Expenditure has slipped from 2022-23 into 2023-24 TIF - Halfway House Roundabout (550) 550 0 0 0 (550) (550) Slip budget into future years. Delays with Planning Applications and ongoing discussions with Scottish Government have resulted in delays in progressing the project and expenditure. Expenditure has slipped from 2022-23 into 2023-24 Total Slippages and Accelerations (760) 760 0 0 0 (760) (760) Net Impact of Changes (760) 760 0 0 0 (760) (760)
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CAPITAL PROGRAMME FUNDING Appendix 5 Estimated Capital Funding Carry Forwards from 21-22 Slippage / Acceleration Additional Funding Updated Capital Funding Available Estimated Capital Funding Carry Forwards from 21-22 Slippage / Acceleration Additional Funding Updated Capital Funding Available Estimated Capital Funding Carry Forwards from 21-22 Slippage / Acceleration Additional Funding Updated Capital Funding Available General Capital Grant 9,569 0 0 0 9,569 9,569 0 0 0 9,569 9,569 0 0 0 9,569 Transfer to Revenue for Private Sector Housing Grant (PSHG) -1,033 0 0 0 -1,033 -1,033 0 0 0 -1,033 -1,033 0 0 0 -1,033 Capital Receipts 1,387 0 0 0 1,387 1,095 0 0 0 1,095 0 0 0 0 0 Flooding Allocation 155 0 0 0 155 155 0 0 0 155 155 0 0 0 155 Ring Fenced Capital Grant 4,656 2,722 0 268 7,646 0 5,728 0 0 5,728 0 0 0 0 0 Restricted Funding 1,486 609 -210 1,714 3,599 1,150 0 210 0 1,360 0 0 0 0 0 Funded by Reserves 3,145 4,388 -1,256 1,146 7,423 36 172 -75 0 133 0 0 1,331 0 1,331 Additional Funding from Revenue 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Insurance 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Harbour Investment Programme 31,180 2,484 -18,114 0 15,550 16,900 0 6,125 0 23,025 31,600 0 -3,400 0 28,200 Prudential Borrowing 15,528 3,352 -628 0 18,252 5,006 -1,429 628 0 4,205 27 0 0 0 27 Loans Fund Review 0 4,025 0 0 4,025 0 0 0 0 0 0 0 0 0 0 COVID Funding 1,640 2,167 0 0 3,807 0 0 0 0 0 0 0 0 0 0 67,713 19,747 -20,208 3,128 70,380 32,878 4,471 6,888 0 44,237 40,318 0 -2,069 0 38,249 BREAKDOWN OF ADDITIONAL FUNDING Additional Funding 2022-23 2023-24 Reported C'town Museum LA income 40 Live Argyll Jun-22 H&L/Rosneath Cycleways 140 Jun-22 Nature Restoration Fund 238 Jun-22 Rothesay Pontoons 315 Grant Funding Jun-22 Ardrishaig North 280 Grant Funding Jun-22 Lismore Ferry 7 External Income Jun-22 Lochgilphead PS Demolition 11 Reserves Jun-22 Fleet Management 499 Reserves Jul-22 Roads Reconstruction 958 STTS Jul-22 Gartrecfk Landfill 640 Reserves Aug-22 Total 3,128 0 2022-23 SPT Scottish Government 2024-252023-24 Source
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OFF TRACK PROJECT Appendix 6 Project Name: Ardrishaig North Public Realm Project Manager: Anna Watkiss Risk: Low Initial Start Date: Design work commenced 2018/19, contract award 21/6/2022 Proposed End Date: April 2023 How was this project initially funded? Tarbert and Lochgilphead Regeneration Fund Please detail any additional funding. Green Infrastructure Fund, Crown Estate Scotland, HiTrans Previously Reported Committee and Date: Next Reported Committee and Date: Why is the project classified as off target? Levels of expenditure have not been as expected and fall outside the tolerances, the project is now expected to be ongoing into 2023/24 financial year. What has caused the issue outlined above? The contract was awarded later than expected (21 June 2022 rather than the early May) due to delays in receiving required documentation and the contractor has taken longer to deploy to site than anticipated. This has all impacted the expected timescales for spend. We expect that this will change again as we are awaiting a spend profile from the contractor in terms of their anticipated billing of costs. What action will be taken to rectify this issue? Timescales for the project will be monitored and cost profiles adjusted in order to ensure that they are as accurate as possible. What are the implications of the action proposed? None anticipated
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OFF TRACK PROJECT Appendix 6 Project Name: TiF Halfway House Roundabout Project Manager: Adrian Jackson-Stark Risk: Low Initial Start Date: 2022 Proposed End Date: 2024 How was this project initially funded? TiF Prudential Borrowing Please detail any additional funding. n/a Previously Reported Committee and Date: Next Reported Committee and Date: Why is the project classified as off target? Levels of expenditure have not been as expected and fall outside the tolerances, the project is now expected to commence in 2023/24 financial year. What has caused the issue outlined above? Delays with Planning Applications and ongoing discussions with Scottish Government have resulted in delays in progressing the project and expenditure. Studies are currently underway to determine scope of works in order to progress as soon as discussions have been finalised. What action will be taken to rectify this issue? Timescales for the project will be monitored closely and updated as discussions and studies progress. What are the implications of the action proposed? Budget slipped from 2022-23 in to 2023-24.
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Strategic Change Projects - Cumulative Spend, Start/Finish Dates and Project Risks APPENDIX 7 Strategic Change Projects Prior Years Spend £'000 Current Year Forecast £'000 Total Project Forecast £'000 Total Project Budget £'000 Project Start Date Estimated Completion Date Project Risks Identified Explanation TIF - Halfway House Roundabout 0 47 640 640 tbc tbc Red Delays due to discussions with Scottish Government and Planning Consents delays. CHORD Oban 7,129 651 7,905 7,905 27/10/2016 31/03/2022 Amber Issues with contract close out impacting on timescales. Harbour Investment Programme 1,802 15,550 91,292 91,292 01/04/2017 31/03/2028 Green Campbeltown Flood Scheme 181 9,098 15,215 15,215 01/08/2016 31/03/2023 Green Dunoon Primary 7,170 304 10,869 10,869 18/12/2014 30/04/2020 Green Physically complete - negotiations with contractor delaying payment of final sums outstanding. Kirn Primary School 9,878 99 10,119 10,119 24/04/2014 31/10/2017 Green Physically complete - negotiations with contractor delaying payment of final sums outstanding. Replacement of Oban High 2,496 136 3,250 3,250 24/04/2014 31/01/2019 Green Physically complete - negotiations with contractor delaying payment of final sums outstanding. Street Lighting LED Replacement 2,700 791 3,900 3,900 01/08/2016 31/12/2022 Green Tender for final package of works still to be awarded. Helensburgh Office Rationalisation 11,500 310 11,838 11,838 25/04/2013 31/12/2022 Green Project subject to legal dispute. CHORD Dunoon 12,238 55 12,522 12,522 03/02/2012 09/03/2018 Green Main contract complete and retentions paid. Landscaping and remediation works ongoing but issues with water ingress may require works in 22-23. Helensburgh Waterfront Development 1,387 2,895 22,557 22,557 01/04/2017 31/03/2024 Green Additional funding awarded resulting in increased budget. Budget to be reprofiled. Kilmory Business Park Phase 2AA 0 141 150 150 01/02/2022 01/09/2023 Green Development Agreement still to be concluded. Carbon Management Business Cases 201 60 261 261 01/02/2014 31/12/2022 Green Budget to be reprofiled pending development of new projects. Carbon Management - Group Heating Conversion Project 1,938 10 1,948 1,948 01/02/2016 31/12/2022 Green Complete. Carbon Management - Non Education 14 21 50 50 01/04/2015 31/12/2022 Green Projects being determined. NPDO Schools Solar PV Panel Installations 761 183 944 944 26/06/2014 31/12/2022 Green Budget to be reprofiled pending development of new projects. Non NPDO Schools Solar PV Panel Installations 400 88 488 488 20/03/2014 31/12/2022 Green Budget to be reprofiled pending development of new projects. Carbon Management Capital Property Works 2016/17 19 20 39 39 01/02/2016 31/12/2022 Green Budget to be reprofiled pending development of new projects. Oil to Gas Heating Conversions 182 5 187 187 01/02/2012 31/12/2022 Green Budget to be reprofiled pending development of new projects. Dunoon Pier OBC 2,844 0 2,844 2,844 03/02/2012 26/02/2016 Green Project complete. Campbeltown Office Rationalisation 595 1 596 596 01/02/2015 31/03/2019 Green Complete. TIF - Oban Airport Business Park 447 101 590 590 22/01/2015 31/12/2022 Green Campbeltown Schools Redevelopment 1,649 76 2,130 2,130 16/02/2012 30/11/2018 Green Physically complete - negotiations with contractor delaying payment of financial sums outstanding. CHORD - Helensburgh 6,483 28 6,557 6,557 29/09/2011 30/04/2015 Green Main contract complete. Art project originally proposed for 21-22 now slipped into 22-23. TIF - North Pier Extension 214 0 214 214 06/12/2017 06/12/2021 Green Complete. TIF - Lorn/Kirk Road 1,959 1 2,170 2,170 22/01/2015 31/03/2021 Green Complete. Carbon Management Fuel Conversions 107 0 107 107 01/02/2014 31/03/2019 Green Complete. Kilmory Biomass Carbon Management 956 0 956 956 20/09/2012 31/03/2019 Green Complete. Strategic Change Total 75,250 30,671 210,338 210,338 Project Risk Classifications: Green - Risks can be managed and are viewed as stable or reducing. Amber - Risks are increasing but are still manageable. Red - Risks are increasing or have increased to such an extent they may affect delivery of the project. Capital Expenditure Dates Risks
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ARGYLL AND BUTE COUNCIL - CAPITAL PLAN MONITORING REPORT - OVERALL COUNCIL FINANCIAL SUMMARY - NET EXPENDITURE Current Financial Year To Date Budget Actual (Over)/Under Variance Budget Forecast (Over)/Under Variance Budget Forecast (Over)/Under Variance £000s £000s £000s £000s £000s £000s £000s £000s £000s EXPENDITURE Asset Sustainability Projects Executive Director Douglas Hendry 1,464 1,572 (108) 10,003 10,139 (136) 19,032 19,173 (141) Executive Director Kirsty Flanagan 4,820 4,820 0 19,627 19,627 0 34,442 34,442 0 Asset Sustainability Total 6,284 6,392 (108) 29,630 29,766 (136) 53,474 53,615 (141) Service Development Projects Executive Director Douglas Hendry 567 567 0 1,242 1,267 (25) 15,144 15,169 (25) Executive Director Kirsty Flanagan 742 765 (23) 7,652 7,479 173 33,099 33,136 (37) Service Development Total 1,309 1,332 (23) 8,894 8,746 148 48,243 48,305 (62) Strategic Change Projects Campbeltown Schools Redevelopment 38 38 0 76 76 0 2,130 2,130 0 Dunoon Primary 257 257 0 304 304 0 10,869 10,869 0 Replacement of Oban High 96 96 0 136 136 0 3,250 3,250 0 Kirn Primary School 65 65 0 99 99 0 10,119 10,119 0 Carbon Management - Non Education 0 0 0 21 21 0 50 50 0 Carbon Management Business Cases 0 0 0 60 60 0 261 261 0 NPDO Schools Solar PV Panel Installations 0 0 0 183 183 0 944 944 0 Non NPDO Schools Solar PV Panel Installations 0 0 0 88 88 0 488 488 0 Carbon Management Fuel Conversions 0 0 0 0 0 0 107 107 0 Carbon Management Capital Property Works 2016/17 0 0 0 20 20 0 39 39 0 Carbon Management - Group Heating Conversion Project 0 0 0 10 10 0 1,948 1,948 0 Kilmory Biomass Carbon Management 0 0 0 0 0 0 956 956 0 Oil to Gas Heating Conversions 0 0 0 5 5 0 187 187 0 Campbeltown Office Rationalisation 0 0 0 1 1 0 596 596 0 Helensburgh Office Rationalisation 10 10 0 310 310 0 11,838 11,838 0 Clean Energy 0 0 0 551 567 (16) 729 745 (16) Clean Energy 2022-23 0 0 0 500 500 0 500 500 0 Campbeltown Flood Scheme 31 31 0 9,098 9,098 0 15,215 15,215 0 Street Lighting LED Replacement 49 49 0 791 791 0 3,900 3,900 0 Harbour Investment Programme 186 186 0 15,550 15,550 0 91,292 91,292 0 TIF - Lorn/Kirk Road 0 0 0 1 1 0 2,170 2,170 0 TIF - North Pier Extension 0 0 0 0 0 0 214 214 0 TIF - Oban Airport Business Park 0 0 0 101 101 0 590 590 0 TIF - Halfway House Roundabout 0 0 0 597 47 550 640 640 0 CHORD - Helensburgh 0 0 0 28 28 0 6,557 6,557 0 CHORD Dunoon 4 4 0 55 55 0 12,522 12,522 0 CHORD Oban 0 0 0 651 651 0 7,905 7,905 0 Helensburgh Waterfront Development 2,760 2,760 0 2,895 2,895 0 22,557 22,557 0 HWD - FFE (Funded by LA) 5 5 0 344 344 0 350 350 0 Kilmory Business Park Phase 2AA 18 18 0 141 141 0 150 150 0 Dunoon Pier OBC 0 0 0 0 0 0 2,844 2,844 0 Strategic Change Total 3,519 3,519 0 32,616 32,082 534 211,917 211,933 (16) Total Expenditure 11,112 11,243 (131) 71,140 70,594 546 313,634 313,853 (219) INCOME 71,140 70,594 Asset Sustainability Executive Director Douglas Hendry 0 0 0 0 0 0 0 0 0 Executive Director Kirsty Flanagan 0 0 0 (2,390) (2,390) 0 (2,390) (2,390) 0 Asset Sustainability Total 0 0 0 (2,390) (2,390) 0 (2,390) (2,390) 0 Service Development Projects Executive Director Douglas Hendry 0 (38) 38 0 0 0 (7,771) (7,771) 0 Executive Director Kirsty Flanagan (69) (69) 0 (4,046) (4,046) 0 (21,135) (21,135) 0 Service Development Total (69) (107) 38 (4,046) (4,046) 0 (28,906) (28,906) 0 Strategic Change Projects Helensburgh Office Rationalisation 0 0 0 0 0 0 (349) (349) 0 Dunoon Primary 0 0 0 0 0 0 (137) (137) 0 Campbeltown Flood 0 0 0 0 0 0 (270) (270) 0 Harbour PB (186) (186) 0 (15,550) (15,550) 0 (91,292) (91,292) 0 01 TIF - Lorn/Kirk Road 0 0 0 (699) (699) 0 (2,717) (2,717) 0 H'burgh CHORD Public Realm Imprv 0 0 0 0 0 0 (570) (570) 0 Helensburgh Waterfront Development 0 0 0 (195) (195) 0 (6,493) (6,493) 0 HWD - FFE (Funded by LA) 0 4 (4) 0 0 0 (350) (350) 0 CHORD - Dunoon Waterfront 0 0 0 0 0 0 (10) (10) 0 CHORD - Oban 0 0 0 0 0 0 (1,624) (1,624) 0 Strategic Change Total (186) (182) (4) (16,444) (16,444) 0 (103,812) (103,812) 0 Total Income (255) (289) 34 (22,880) (22,880) 0 (135,108) (135,108) 0 Net Total 10,857 10,954 (97) 48,260 47,714 546 178,526 178,745 (219) Appendix 8 Full Year This Financial Year Total Project Costs 31 August 2022
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MONITORING REPORT Current Financial Year To Date Budget Actual (Over)/Under Variance Budget Year End Forecast (Over)/Under Variance Budget Forecast (Over)/Under Variance £000s £000s £000s £000s £000s £000s £000s £000s £000s EXPENDITURE Asset Sustainability Projects Flood Prevention 3 3 0 474 474 0 1,084 1,084 0 Coastal Protection 0 0 0 20 20 0 200 200 0 Coastal Change Adaptation 0 0 0 159 159 0 159 159 0 Bute Sea Wall Repairs 25 25 0 750 750 0 750 750 0 Helensburgh Flood Mitigation 0 0 0 432 432 0 432 432 0 Bridge Strengthening 57 57 0 1,349 1,349 0 2,049 2,049 0 Local Bridge Maintenance Fund 4 4 0 1,237 1,237 0 5,447 5,447 0 Roads Reconstruction 3,356 3,356 0 9,433 9,433 0 16,294 16,294 0 Roads Reconstruction - Helensburgh CHORD 0 0 0 47 47 0 47 47 0 Roads Reconstruction - Oban CHORD 0 0 0 3 3 0 3 3 0 Helensburgh CHORD - Signage etc 0 0 0 10 10 0 10 10 0 Lighting 0 0 0 740 740 0 1,040 1,040 0 Environmental Projects 0 0 0 734 734 0 934 934 0 Play Park Refurbishment 0 0 0 155 155 0 155 155 0 Public Convenience Upgrades 0 0 0 82 82 0 82 82 0 Footway Improvements 147 147 0 269 269 0 269 269 0 Glengorm - Capping 0 0 0 82 82 0 82 82 0 Glengorm - Cell and Transfer Station (PB) 705 705 0 1,200 1,200 0 1,200 1,200 0 EV Quick Chargers 0 0 0 93 93 0 93 93 0 Tobermory Car Park 56 56 0 951 951 0 951 951 0 Active Travel 0 0 0 500 500 0 500 500 0 Bin Replacement Programme 0 0 0 100 100 0 100 100 0 Server Sustainability 4 4 0 187 187 0 251 251 0 PC Replacement 461 461 0 522 522 0 522 522 0 Telecomms Network 2 2 0 98 98 0 98 98 0 Block Allocation - ICT 0 0 0 0 0 0 1,690 1,690 0 Asset Sustainability Total 4,820 4,820 0 19,627 19,627 0 34,442 34,442 0 Service Development Projects Preliminary design for Regional Transport projects 0 0 0 16 16 0 221 221 0 Campbeltown Old Quay 0 0 0 43 43 0 1,424 1,424 0 Fleet Management - Prudential Borrowing 0 0 0 2,187 2,187 0 4,861 4,861 0 Fleet Management 0 0 0 499 499 0 3,358 3,358 0 Lismore Ferry 13 19 (6) 13 19 (6) 666 672 (6) Millpark Depot Demolition 0 0 0 0 0 0 126 126 0 Oban Depot Development Project 0 17 (17) 0 17 (17) 2,100 2,117 (17) Lochgilphead Depot Rationalisation 0 0 0 (10) 0 (10) 19 29 (10) Jackson's Quarry Refurbishment 0 0 0 (2) 0 (2) 283 285 (2) Witchburn Road Demolition 0 0 0 (1) 0 (1) 157 158 (1) Safe Streets, Walking and Cycling (CWSS) 0 0 0 544 544 0 2,878 2,878 0 SPT - bus infrastructure 0 0 0 0 0 0 1,405 1,405 0 Cycleways - H&L (FSPT) 0 0 0 240 240 0 3,112 3,112 0 Helensburgh Public Realm - Arts Strategy Fund 0 0 0 51 51 0 53 53 0 Town Centre Funds 536 536 0 1,054 1,055 (1) 3,876 3,877 (1) Dunoon Cycle Bothy 71 71 0 266 266 0 279 279 0 Dunoon STEM Hub 11 11 0 603 603 0 608 608 0 Ardrishaig North Active Travel 0 0 0 880 670 210 880 880 0 Nature Restoration Fund 0 0 0 346 346 0 346 346 0 Gibraltar Street Public Realm Improvements 9 9 0 248 248 0 250 250 0 Hermitage Park 0 0 0 69 69 0 3,314 3,314 0 Applications Projects 102 102 0 606 606 0 2,883 2,883 0 Service Development Total 742 765 (23) 7,652 7,479 173 33,099 33,136 (37) Strategic Change Projects Campbeltown Flood Scheme 31 31 0 9,098 9,098 0 15,215 15,215 0 Street Lighting LED Replacement 49 49 0 791 791 0 3,900 3,900 0 Harbour Investment Programme 186 186 0 15,550 15,550 0 91,292 91,292 0 TIF - Lorn/Kirk Road 0 0 0 1 1 0 2,170 2,170 0 TIF - North Pier Extension 0 0 0 0 0 0 214 214 0 TIF - Oban Airport Business Park 0 0 0 101 101 0 590 590 0 TIF - Halfway House Roundabout 0 0 0 597 47 550 640 640 0 Strategic Change Total 266 266 0 26,138 25,588 550 114,021 114,021 0 Total Expenditure 5,828 5,851 (23) 53,417 52,694 723 181,562 181,599 (37) INCOME Asset Sustainability EV Quick Chargers 0 0 0 (97) (97) 0 (97) (97) 0 Glengorm Capping/New Cell - Prudential Borrowing 0 0 0 (560) (560) 0 (560) (560) 0 Tobermory Car Park 0 0 0 (775) (775) 0 (775) (775) 0Asset Sustainability Total 0 0 0 (2,390) (2,390) 0 (2,390) (2,390) 0 Service Development Projects Applications Projects 0 0 0 (46) (46) 0 (437) (437) 0 Safe Streets, Walking and Cycling 0 0 0 (550) (550) 0 (2,483) (2,483) 0 SPfT 0 0 0 0 0 0 (1,243) (1,243) 0 Cycleways - H&L (FSPT) 0 0 0 (240) (240) 0 (3,212) (3,212) 0 Town Centre Funds 0 0 0 (382) (382) 0 (1,794) (1,794) 0 Dunoon STEM Hub 0 0 0 (100) (100) 0 (608) (608) 0 Ardrishaig North Active Travel (50) (50) 0 (50) (50) 0 (50) (50) 0 Dunoon Cycle Bothy 0 0 0 (209) (209) 0 (279) (279) 0 Gibraltar Street Public Realm Improvements 0 0 0 0 0 0 (250) (250) 0 Hermitage Park 0 0 0 0 0 0 (3,245) (3,245) 0 Fleet Management - PB 0 0 0 (2,187) (2,187) 0 (4,861) (4,861) 0 Fleet Management (8) (8) 0 0 0 0 0 0 0 Lochgilphead Depot Rationalisation 0 0 0 (1) (1) 0 (1) (1) 0 Millpark Depot Demolition Insurance 0 0 0 0 0 0 (53) (53) 0 Oban Depot - Mill Park Insurance Claim 0 0 0 0 0 0 (1,681) (1,681) 0 Oban Depot - Appin Depot Sale 0 0 0 (150) (150) 0 (150) (150) 0 Lismore Ferry (11) (11) 0 (131) (131) 0 (631) (631) 0 Witchburn Road Demolition 0 0 0 0 0 0 (157) (157) 0 Service Development Total (69) (69) 0 (4,046) (4,046) 0 (21,135) (21,135) 0 Strategic Change Projects Campbeltown Flood 0 0 0 0 0 0 (270) (270) 0 Harbour PB (186) (186) 0 (15,550) (15,550) 0 (91,292) (91,292) 0 01 TIF - Lorn/Kirk Road 0 0 0 (699) (699) 0 (2,717) (2,717) 0 Strategic Change Total (186) (186) 0 (16,249) (16,249) 0 (94,279) (94,279) 0 Total Income (255) (255) 0 (22,685) (22,685) 0 (117,804) (117,804) 0 Net Departmental Total 5,573 5,596 (23) 30,732 30,009 723 63,758 63,795 (37) 31 August 2022 Full Year This Financial Year Total Project Costs FINANCIAL SUMMARY NET EXPENDITURE - EXECUTIVE DIRECTOR KIRSTY FLANAGAN Appendix 8
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MONITORING REPORT Budget Actual Variance Budget Forecast Variance Budget Forecast Variance £000s £000s £000s £000s £000s £000s £000s £000s £000s EXPENDITURE Asset Sustainability Education 1,273 1,273 0 4,281 4,307 (26) 10,761 10,787 (26) Live Argyll 82 141 (59) 1,200 1,259 (59) 2,086 2,150 (64) Health and Social Care Partnership 75 124 (49) 2,053 2,104 (51) 2,922 2,973 (51) Shared Offices 34 34 0 2,469 2,469 0 3,263 3,263 0 Asset Sustainability Total 1,464 1,572 (108) 10,003 10,139 (136) 19,032 19,173 (141) Service Development Projects Ardrishaig Primary Pre 5 Unit 0 0 0 0 0 0 2 2 0 Bowmore Primary School - Pre 5 Unit 0 0 0 0 0 0 149 149 0 Clyde Cottage - 600 hour provision 0 0 0 23 23 0 579 579 0 Craignish Primary School - Pre 5 Extension 0 0 0 0 0 0 400 400 0 Iona Primary School - Pre 5 Unit 0 0 0 0 0 0 490 490 0 Islay High and Rosneath Primary School Pitches 0 0 0 (12) 0 (12) 707 719 (12) Lochgoilhead Primary School - Pre 5 Unit 0 0 0 0 0 0 391 391 0 Park Primary Extension/Pre Fives Unit 0 0 0 0 0 0 341 341 0 Sandbank Gaelic Pre Five Unit 0 0 0 0 0 0 491 491 0 Bunessan Primary School - Gaelic Medium Improvements 0 0 0 0 0 0 120 120 0 Early Learning and Childcare 0 0 0 0 0 0 850 850 0 Early Learning and Childcare - 1140 Hours 564 564 0 1,036 1,036 0 7,751 7,751 0 CO2 Monitoring - Covid Mitigation in Schools 3 3 0 116 116 0 192 192 0 Early Learning and Childcare - 1140 Hours - CFCR 0 0 0 0 0 0 111 111 0 Bowmore Primary School - Gaelic Medium Grant 0 0 0 38 38 0 38 38 0 Riverside Leisure Centre Refurbishment 0 0 0 (13) 0 (13) 1,232 1,245 (13) Dunclutha Childrens Home 0 0 0 54 54 0 1,300 1,300 0 Service Development Total 567 567 0 1,242 1,267 (25) 15,144 15,169 (25) Strategic Change Projects Campbeltown Schools Redevelopment 38 38 0 76 76 0 2,130 2,130 0 Dunoon Primary 257 257 0 304 304 0 10,869 10,869 0 Replacement of Oban High 96 96 0 136 136 0 3,250 3,250 0 Kirn Primary School 65 65 0 99 99 0 10,119 10,119 0 Carbon Management - Non Education 0 0 0 21 21 0 50 50 0 Carbon Management Business Cases 0 0 0 60 60 0 261 261 0 NPDO Schools Solar PV Panel Installations 0 0 0 183 183 0 944 944 0 Non NPDO Schools Solar PV Panel Installations 0 0 0 88 88 0 488 488 0 Carbon Management Fuel Conversions 0 0 0 0 0 0 107 107 0 Carbon Management Capital Property Works 2016/17 0 0 0 20 20 0 39 39 0 Carbon Management - Group Heating Conversion Project 0 0 0 10 10 0 1,948 1,948 0 Kilmory Biomass Carbon Management 0 0 0 0 0 0 956 956 0 Oil to Gas Heating Conversions 0 0 0 5 5 0 187 187 0 Campbeltown Office Rationalisation 0 0 0 1 1 0 596 596 0 Helensburgh Office Rationalisation 10 10 0 310 310 0 11,838 11,838 0 Clean Energy 0 0 0 551 567 (16) 729 745 (16) Clean Energy 2022-23 0 0 0 500 500 0 500 500 0 CHORD Oban 0 0 0 651 651 0 7,905 7,905 0 CHORD - Helensburgh 0 0 0 28 28 0 6,557 6,557 0 CHORD Dunoon 4 4 0 55 55 0 12,522 12,522 0 Helensburgh Waterfront Deveopment 2,760 2,760 0 2,895 2,895 0 22,557 22,557 0 HWD - FFE (Funded by LA) 5 5 0 344 344 0 350 350 0 Kilmory Business Park Phase 2AA 18 18 0 141 141 0 150 150 0 Dunoon Pier OBC 0 0 0 0 0 0 2,844 2,844 0 Strategic Change Total 3,253 3,253 0 6,478 6,494 (16) 97,896 97,912 (16) Total Expenditure 5,284 5,392 (108) 17,723 17,900 (177) 132,072 132,254 (182) INCOME Asset Sustainability Education 0 0 0 0 0 0 0 0 0 Live Argyll 0 0 0 0 0 0 0 0 0 Asset Sustainability Total 0 0 0 0 0 0 0 0 0 Service Development Projects Sandbank Gaelic Pre Five Unit 0 0 0 0 0 0 (485) (485) 0 Bunessan Primary School - Gaelic Medium Improvements 0 0 0 0 0 0 (30) (30) 0 Early Learning and Childcare 0 0 0 0 0 0 (918) (918) 0 Early Years 1140 Hours 0 0 0 0 0 0 (6,300) (6,300) 0 CO2 Monitoring - Covid Mitigation in Schools 0 (38) 38 0 0 0 0 0 0 Bowmore Primary School - Gaelic Medium Grant 0 0 0 0 0 0 (38) (38) 0 Service Development Total 0 (38) 38 0 0 0 (7,771) (7,771) 0 Strategic Change Helensburgh Office Rationalisation 0 0 0 0 0 0 (349) (349) 0 Dunoon Primary School 0 0 0 0 0 0 (137) (137) 0 H'burgh CHORD Public Realm Imprv 0 0 0 0 0 0 (570) (570) 0 Helensburgh Waterfront Development 0 0 0 (195) (195) 0 (6,493) (6,493) 0 HWD - FFE (Funded by LA) 0 4 (4) 0 0 0 (350) (350) 0 CHORD - Dunoon Waterfront 0 0 0 0 0 0 (10) (10) 0 CHORD - Oban 0 0 0 0 0 0 (1,624) (1,624) 0 Strategic Change Total 0 4 (4) (195) (195) 0 (9,533) (9,533) 0 Total Income 0 (34) 34 (195) (195) 0 (17,304) (17,304) 0 Net Departmental Total 5,284 5,358 (74) 17,528 17,705 (177) 114,768 114,950 (182) 31 August 2022 Total Project CostsFull Year This Financial YearCurrent Financial Year To Date Appendix 8 FINANCIAL SUMMARY NET EXPENDITURE - EXECUTIVE DIRECTOR DOUGLAS HENDRY
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CAPITAL PLAN 2022-23 APPENDIX 9 Overall Summary Service Previous Years £000's 2022-23 £000s 2023-24 £000s 2024-25 £000s 2025-26 £000s 2026-27 £000s Total £000s Education 36,575 6,097 4,843 2,226 0 0 49,741 Shared Offices 16,687 4,197 544 428 0 0 21,856 ICT 2,126 1,413 1,134 771 0 0 5,444 RIS 21,128 47,004 35,592 33,968 17,811 0 155,503 DEG 15,435 4,240 940 0 0 0 20,615 HSCP 1,246 2,107 441 428 0 0 4,222 Live Argyll 1,274 1,208 458 428 0 0 3,368 CHORD 48,486 4,114 285 0 0 0 52,885 Overall Total 142,957 70,380 44,237 38,249 17,811 0 313,634
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CAPITAL PLAN 2022-23 APPENDIX 9 Education Category Service Project Previous Years £000's 2022-23 £000s 2023-24 £000s 2024-25 £000s 2025-26 £000s 2026-27 £000s Total £000s Asset Sustainability Education Asbestos Control/Removal Works 0 7 0 0 0 0 7 Block Allocation - Education 0 2,716 4,231 2,226 0 0 9,173 Digital Inclusion 20-21 0 9 0 0 0 0 9 Free School Meals 0 14 0 0 0 0 14 Homeless Houses - Housing Quality Standard 0 1 0 0 0 0 1 Internal Refurbishment Budget 0 7 0 0 0 0 7 Lochgilphead Primary School Demolition 0 7 0 0 0 0 7 Pre-5's/Nurseries 0 1 0 0 0 0 1 Primary Schools 0 1,030 23 0 0 0 1,053 School Houses - Housing Quality Standard 0 26 0 0 0 0 26 Secondary Schools 0 463 0 0 0 0 463 Asset Sustainability Total 0 4,281 4,254 2,226 0 0 10,761 Service Development Education Ardrishaig Primar School - Pre Five Extension 2 0 0 0 0 0 2 Bowmore Primary School - Gaelic Medium Grant 0 38 0 0 0 0 38 Bowmore Primary School - Pre Five Unit 149 0 0 0 0 0 149 Bunessan Primary School - Gaelic Medium Improvements 120 0 0 0 0 0 120 Clyde Cottage - 600 hours provision 556 23 0 0 0 0 579 CO2 Monitoring - Covid Mitigation in Schools 76 116 0 0 0 0 192 Craignish Primary School - Pre Five Extension (600 hours funding) 400 0 0 0 0 0 400 Early Learning and Childcare 850 0 0 0 0 0 850 Early Learning and Childcare - 1140 Hours 6,696 1,036 19 0 0 0 7,751 Early Learning and Childcare - 1140 Hours - CFCR 111 0 0 0 0 0 111 Iona Primary School - Pre Five Unit (600 hours funding) 490 0 0 0 0 0 490 Islay High & Rosneath PS Pitches 719 -12 0 0 0 0 707 Lochgoilhead Primary School - Pre Five Unit (600 hours funding) 391 0 0 0 0 0 391 Park Primary Extension and Pre Fives Unit 341 0 0 0 0 0 341 Sandbank Gaelic Pre Five Unit 491 0 0 0 0 0 491 Service Development Total 11,392 1,201 19 0 0 0 12,612 Strategic Change Education Campbeltown Schools Redevelopment 2,054 76 0 0 0 0 2,130 Dunoon Primary School 10,365 304 200 0 0 0 10,869 Kirn Primary School 10,020 99 0 0 0 0 10,119 Replacement of Oban High School 2,744 136 370 0 0 0 3,250 Strategic Change Total 25,183 615 570 0 0 0 26,368 Overall Total 36,575 6,097 4,843 2,226 0 0 49,741
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CAPITAL PLAN 2022-23 APPENDIX 9 Shared Office Category Service Project Previous Years £000's 2022-23 £000s 2023-24 £000s 2024-25 £000s 2025-26 £000s 2026-27 £000s Total £000s Asset Sustainability Shared Offices Argyll House, Dunoon 0 12 0 0 0 0 12 Asbestos Capital Property Works 0 51 0 0 0 0 51 Block Allocation 0 0 236 398 0 0 634 Bowmore Area Office 0 76 0 0 0 0 76 Burnett Building 0 110 0 0 0 0 110 Capital Property Works 0 38 0 0 0 0 38 Fire Risk Assessment Works 0 14 0 0 0 0 14 Hill Street Dunoon Rewire 0 33 0 0 0 0 33 Kilmory Castle 0 1,368 43 0 0 0 1,411 Legionella Control Works 0 215 0 0 0 0 215 Manse Brae District Office 0 1 0 0 0 0 1 Manse Brae Roads Office 0 2 0 0 0 0 2 Our Modern Workspace 0 549 87 30 0 0 666 Asset Sustainability Total 0 2,469 366 428 0 0 3,263 Strategic Change Shared Offices Campbeltown Office Rationalisation 595 1 0 0 0 0 596 Carbon Management - Group Heating Conversion Project (Prudential Borrowing)1,938 10 0 0 0 0 1,948 Carbon Management Business Cases (FPB) 201 60 0 0 0 0 261 Carbon Management Capital Property Works 16/17 19 20 0 0 0 0 39 Carbon Management Fuel Conversions (FPB) 107 0 0 0 0 0 107 Cleaner Energy 0 551 178 0 0 0 729 Cleaner Energy 2022-23 0 500 0 0 0 0 500 Helensburgh Office Rationalisation (FPB,REC) 11,528 310 0 0 0 0 11,838 Kilmory Biomass Project OBC (FPB,REV) 956 0 0 0 0 0 956 Non-NPDO Schools PV Panel Installations 400 88 0 0 0 0 488 NPDO Schools Solar PV Panel Installations 761 183 0 0 0 0 944 Oil to Gas Heating Conversions (FPB) 182 5 0 0 0 0 187 Strategic Change Total 16,687 1,728 178 0 0 0 18,593 Overall Total 16,687 4,197 544 428 0 0 21,856
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CAPITAL PLAN 2022-23 APPENDIX 9 Major Projects Category Service Project Previous Years £000's 2022-23 £000s 2023-24 £000s 2024-25 £000s 2025-26 £000s 2026-27 £000s Total £000s Strategic Change CHORD CHORD - Dunoon 12,467 55 0 0 0 0 12,522 CHORD - Helensburgh -Public Realm Imprv 6,529 28 0 0 0 0 6,557 CHORD - Oban 7,254 651 0 0 0 0 7,905 Helensburgh Waterfront Development 19,377 2,895 285 0 0 0 22,557 HWD - FFE 6 344 0 0 0 0 350 Kilmory Business Park Phase 2AA 9 141 0 0 0 0 150 OBC for Dunoon Pier 2,844 0 0 0 0 0 2,844 Strategic Change Total 48,486 4,114 285 0 0 0 52,885 Overall Total 48,486 4,114 285 0 0 0 52,885
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CAPITAL PLAN 2022-23 APPENDIX 9 ICT Category Service Project Previous Years £000's 2022-23 £000s 2023-24 £000s 2024-25 £000s 2025-26 £000s 2026-27 £000s Total £000s Asset Sustainability ICT Block Allocation - ICT 0 0 919 771 0 0 1,690 PC Replacement 0 522 0 0 0 0 522 Server Sustainability 0 187 64 0 0 0 251 Telecomms Network 0 98 0 0 0 0 98 Asset Sustainability Total 0 807 983 771 0 0 2,561 Service Development ICT Applications Projects 2,126 606 151 0 0 0 2,883 Service Development Total 2,126 606 151 0 0 0 2,883 Overall Total 2,126 1,413 1,134 771 0 0 5,444
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CAPITAL PLAN 2022-23 APPENDIX 9 Roads and Infrastructure Services Category Service Project Previous Years £000's 2022-23 £000s 2023-24 £000s 2024-25 £000s 2025-26 £000s 2026-27 £000s Total £000s Asset Sustainability RIS Bin Replacement Programme 0 100 0 0 0 0 100 Bridge Strengthening 0 1,349 350 350 0 0 2,049 Bute Sea Wall Repairs 0 750 0 0 0 0 750 Coastal Change Adaptation 0 159 0 0 0 0 159 Coastal Protection 0 20 80 100 0 0 200 Environmental Projects 0 734 100 100 0 0 934 EV Quick Chargers 0 93 0 0 0 0 93 Flood Prevention 0 474 305 305 0 0 1,084 Footway Improvements 0 269 0 0 0 0 269 Glengorm - Capping 0 82 0 0 0 0 82 Glengorm - Cell and Transfer Station (PB) 0 1,200 0 0 0 0 1,200 Helensburgh CHORD - Signage etc 0 10 0 0 0 0 10 Helensburgh Flood Mitigation 0 432 0 0 0 0 432 Investment in Active Travel 0 500 0 0 0 0 500 Lighting 0 740 150 150 0 0 1,040 Local Bridge Maintenance Fund 0 1,237 4,210 0 0 0 5,447 Play Park Renewal 0 155 0 0 0 0 155 Public Convenience Upgrades 0 82 0 0 0 0 82 Roads Reconstruction 0 9,433 3,449 3,412 0 0 16,294 Roads Reconstruction - Helensburgh CHORD 0 47 0 0 0 0 47 Roads Reconstruction - Oban CHORD 0 3 0 0 0 0 3 Tobermory Car Park 0 951 0 0 0 0 951 Asset Sustainability Total 0 18,820 8,644 4,417 0 0 31,881 Service Development RIS Campbeltown Old Quay 1,381 43 0 0 0 0 1,424 Fleet Management 2,859 499 0 0 0 0 3,358 Fleet Management - Prudential Borrowing 2,674 2,187 0 0 0 0 4,861 Jackson's Quarry Refurbishment 285 -2 0 0 0 0 283 Lismore Ferry Replacement 618 13 15 20 0 0 666 Lochgilphead Depot Rationalisation 29 -10 0 0 0 0 19 Mill Park Depot Demolition 126 0 0 0 0 0 126 Oban Depot Development 2,100 0 0 0 0 0 2,100 Preliminary design for Regional Transport projects (tif) 205 16 0 0 0 0 221 Witchburn Road Demolition 158 -1 0 0 0 0 157 Service Development Total 10,435 2,745 15 20 0 0 13,215 Strategic Change RIS Campbeltown Flood Scheme 878 9,098 3,908 1,331 0 0 15,215 Harbour Investment Programme PB 6,706 15,550 23,025 28,200 17,811 0 91,292 Street Lighting LED Replacement 3,109 791 0 0 0 0 3,900 Strategic Change Total 10,693 25,439 26,933 29,531 17,811 0 110,407 Overall Total 21,128 47,004 35,592 33,968 17,811 0 155,503
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CAPITAL PLAN 2022-23 APPENDIX 9 Development and Economic Growth Category Service Project Previous Years £000's 2022-23 £000s 2023-24 £000s 2024-25 £000s 2025-26 £000s 2026-27 £000s Total £000s Service Development DEG Ardrishaig North Active Travel 0 670 210 0 0 0 880 Cycleways - H&L (FSPT) 2,722 240 150 0 0 0 3,112 Dunoon Cycle Bothy 13 266 0 0 0 0 279 Dunoon STEM Hub 5 603 0 0 0 0 608 Gibraltar Street Public Realm Improvements 2 248 0 0 0 0 250 Helensburgh Public Realm - Arts Strategy Fund 2 51 0 0 0 0 53 Hermitage Park 3,245 69 0 0 0 0 3,314 Nature Restoration Fund 0 346 0 0 0 0 346 Safe Streets, Walking and Cycling (CWSS) 2,334 544 0 0 0 0 2,878 SPT - bus infrastructure 1,405 0 0 0 0 0 1,405 Town Centre Funds 2,792 1,054 30 0 0 0 3,876 Service Development Total 12,520 4,091 390 0 0 0 17,001 Strategic Change DEG 01 TIF - Lorn/Kirk Road 2,169 1 0 0 0 0 2,170 05 TIF - North Pier Extension 214 0 0 0 0 0 214 09 TIF - Oban Airport Business Park 489 101 0 0 0 0 590 TIF - Halfway House Roundabout 43 47 550 0 0 0 640 Strategic Change Total 2,915 149 550 0 0 0 3,614 Overall Total 15,435 4,240 940 0 0 0 20,615
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CAPITAL PLAN 2022-23 APPENDIX 9 Health & Social Care Partnership Category Service Project Previous Years £000's 2022-23 £000s 2023-24 £000s 2024-25 £000s 2025-26 £000s 2026-27 £000s Total £000s Asset Sustainability HSCP Ardfenaig 0 125 0 0 0 0 125 Block Allocation 0 0 10 170 0 0 180 Capital Property Works 0 139 0 0 0 0 139 Digitalising telecare 0 100 0 0 0 0 100 Dunoon Hostel 0 0 0 0 0 0 0 Eadar Glinn 0 196 0 0 0 0 196 Glencruitten Hostel 0 75 0 0 0 0 75 Gortonvogie 0 431 421 258 0 0 1,110 Greenwood/Woodlands 0 224 0 0 0 0 224 Kilmory Castle Top Floor Toilet Refurb 0 -2 0 0 0 0 -2 Shellach View 0 0 0 0 0 0 0 Struan Lodge Boiler 0 252 0 0 0 0 252 Thomson Home Rothesay 0 125 0 0 0 0 125 Tigh An Rudha HFE 0 372 10 0 0 0 382 Asset Sustainability Total 0 2,053 441 428 0 0 2,922 Service Development HSCP Dunclutha Childrens Home 1,246 54 0 0 0 0 1,300 Service Development Total 1,246 54 0 0 0 0 1,300 Overall Total 1,246 2,107 441 428 0 0 4,222
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CAPITAL PLAN 2022-23 APPENDIX 9 Live Argyll Category Service Project Previous Years £000's 2022-23 £000s 2023-24 £000s 2024-25 £000s 2025-26 £000s 2026-27 £000s Total £000s Asset Sustainability Live Argyll Aqualibrium 0 95 220 80 0 0 395 Campbeltown Museum - Burnet Bldg 0 40 0 0 0 0 40 Capital Property Works 0 602 0 -5 0 0 597 Inveraray CARS 0 21 0 0 0 0 21 Kintyre Community Education Centre - Lift Shaft Refurbishment 0 38 0 0 0 0 38 Lochgilphead Library Relocation 0 0 0 0 0 0 0 Riverside Leisure Centre - Cladding Upgrade 0 46 0 0 0 0 46 Riverside Leisure Centre - Spa Pool Upgrade 0 80 60 0 0 0 140 Rothesay Swimming Pool 0 0 40 0 0 0 40 The Moat Centre - Gym Store 0 -2 0 50 0 0 48 Victoria Halls, Helensburgh 0 40 0 0 0 0 40 Asset Sustainability Total 0 1,200 458 428 0 0 2,086 Service Development Live Argyll Riverside Leisure Centre Refurbishment 1,245 -13 0 0 0 0 1,232 Service Development Total 1,245 -13 0 0 0 0 1,232 Strategic Change Live Argyll Carbon Management 29 21 0 0 0 0 50 Strategic Change Total 29 21 0 0 0 0 50 Overall Total 1,274 1,208 458 428 0 0 3,368
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 13 OCTOBER 2022 TREASURY MANAGEMENT MONITORING REPORT – 31 AUGUST 2022 1. EXECUTIVE SUMMARY 1.1. This report sets out the Council’s treasury management position for the period 1 July 2022 to 31 August 2022 and includes information on: • Overall borrowing position • Borrowing activity • Investment activity • Economic background • Interest rate forecast • Prudential Indicators 1.2. Estimated borrowing is below the Capital Financing Requirement for the period to 31 August 2022, at this stage in the financial year capital expenditure is below target. Due to delays caused by the COVID-19 pandemic capital expenditure has been relatively low over the last twelve months however there is an expectation this will increase back up again over 2022-23 which will continue to be monitored closely. 1.3. The net movement in external borrowing in the period 1 July 2022 to 31 August 2022 was a decrease of £3.496m. 1.4. The levels of investments were £117.4m at 31 August 2022. The rate of return achieved was 1.802% which compares favourably with the target SONIA rate which was 1.641%. 1.5. The Council has significant cash balances which are invested in accordance with its Annual Treasury Management Strategy on the basis of security first, liquidity second and then return. The high cash levels are largely due to significant COVID-19 funding received from the Scottish Government at the end of 2020-21 and in to 2021-22 which the Council has committed for specific COVID-19 purposes in addition to slippage within the capital programme resulting in a slower rate of spend.
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 13 OCTOBER 2022 TREASURY MANAGEMENT MONITORING REPORT – 31 AUGUST 2022 2. INTRODUCTION 2.1. This report sets out the Council’s treasury management position for the period 1 July 2022 to 31 August 2022 and includes information on: • Overall borrowing position • Borrowing activity • Investment activity • Economic background • Interest rate forecast • Prudential Indicators 3. DETAIL Overall Borrowing Position 3.1. The table below details the estimated capital financing requirement (CFR) and compares this with the estimated level of external debt at 31 March 2022. The CFR represents the underlying need for the Council to borrow to fund its fixed assets and accumulated capital expenditure. Forecast Forecast Forecast 2022/23 2023/24 2024/25 £000 £000 £000 CFR at 1 April 309,092 333,276 348,569 Net Capital Expenditure 34,352 26,680 28,232 Less Loans Fund Principal Repayments (5,353) (5,507) (5,788) Less: NPDO Repayment (4,815) (5,880) (6,038) Estimated CFR 31 March 333,276 348,569 364,975 Less Funded by NPDO (116,681) (117,064) (112,184) Estimated Net CFR 31 March 216,595 231,505 252,791 Estimated External Borrowing at 31 March 212,431 236,654 256,650 Gap 4,164 (5,149) (3,859)
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3.2. Borrowing is below the Capital Financing Requirement for the period to 31 August 2022. Whilst borrowing rates are still comparatively low the Council has significant cash balances which reduces the need to borrow in the short term. 3.3. The Council’s Treasury Management Strategy states that any decision to borrow in advance will be within forward approved Capital Financing Requirement estimates. 3.4. The Council’s estimated net capital financing requirement at 31 August 2022 is £216.6m. The table below shows how this has been financed. £163.6m is funded by loans and there are substantial internal balances of £170.4m of which £117.4m are currently invested, as detailed in section 3.7, leaving a net internal balance of £53m. Position at 30/06/22 Position at 31/08/22 £000 £000 Loans 167,072 163,576 Net Internal Balances 5,357 53,019 Total CFR 172,429 216,595 3.5. During the period from 1 July to 31 August 2022, £3.531m of loans were repaid and £0.035m of new borrowing was taken. The analysis of the movement in borrowing is shown in the table below: Actual £000 External Loans Repaid 1st July 2022 to 31st August 2022 (3,531) Borrowing undertaken 1st July 2022 to 31st August 2022 35 Net Movement in External Borrowing (3,496) 3.6. The table below summarises the movement in the level and rate of temporary borrowing at the start and end of the period. £000 % Rate Temp borrowing at 30th June 2022 518 0.55% Temp borrowing at 31st August 2022 521 0.55%
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Investment Activity 3.8 The average rate of return achieved in the Council’s investments to 31 August 2022 was 1.802% compared to the SONIA (Sterling Overnight Index Average) rate for the same period of 1.641% which demonstrates that the Council continues to achieve a reasonable rate of return on its cash investments. At 30 June 2022 the Council had £117.4m of short term investments at an average rate of 1.802%. The table below details the counterparties that the investments were placed with, the maturity date, the interest rate and the credit rating applicable for each counterparty. Counterparty Maturity Amount £000 Interest Rate Rating S&P Clydesdale Bank Instant Access 370 1.65% Short Term A-2, Long Term A- Clydesdale Bank 20/09/2022 5,000 1.60% Short Term A-2, Long Term A- Toronto Dominion Bank 13/10/2022 5,000 0.50% Short Term A-1+, Long Term AA- Close Bros 31/01/2023 2,500 2.00% Short Term A-1, Long Term A+ AL Ryan Bank 07/12/2022 5,000 1.70% Short Term A-1, Long Term A+ National Bank of Kuwait 11/04/2023 7,500 2.08% Short Term A-1, Long Term A National Bank of Kuwait 17/11/2022 5,000 1.70% Short Term A-1, Long Term A Qatar National Bank 21/10/2022 5,000 1.49% Short Term A-1, Long Term A Qatar National Bank 13/12/2022 5,000 1.94% Short Term A-1, Long Term A Qatar National Bank 10/11/2022 5,000 1.67% Short Term A-1, Long Term A AL Ryan Bank 07/12/2022 5,000 1.70% Short Term A-1, Long Term A+ FADB 10/08/2022 5,000 0.24% Short Term A-1+, Long Term AA- FADB 20/01/2023 5,000 1.00% Short Term A-1+, Long Term AA- FADB 10/05/2023 5,000 2.11% Short Term A-1+, Long Term AA- ANZ 23/02/2023 5,000 3.01% Short Term A-1+, Long Term AA- Rotherham Metropolitan Borough Council 10/10/2022 7,500 0.90% AA Cheshire West & Chester Council 12/01/2023 2,500 0.90% AA Cambridgeshire County Council 22/07/2024 5,000 1.00% AA Slough Borough Council 26/05/2023 5,000 2.10% AA Slough Borough Council 29/06/2023 5,000 2.10% AA Thurrock Borough Council 31/07/2023 5,000 3.00% AA MMF- Federated Call 12,000 1.73% AAA MMF - Insight Call 5,000 1.69% AAA Total 117,370
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3.9 All investments and deposits are in accordance with the Council’s approved list of counterparties and within the limits and parameters defined in the Treasury Management Practices. The counterparty list is constructed based on assessments by leading credit reference agencies adjusted for additional market information available in respect of counterparties. 3.10 The Council has significant cash balances which are invested in accordance with its Annual Treasury Management Strategy. This is largely due to significant COVID-19 funding received from the Scottish Government at the end of 2020-21and in to 2021- 22 which the Council has committed for specific COVID-19 purposes. These cash balances are in excess of what is required for normal operating purposes but the economic environment for investments has improved over the last few months with an increase in interest rates, making investing these monies easier than in previous years. Economic and Interest Rate Forecasts 3.11 The latest economic background is shown in Appendix 1 with the interest rate forecast in Appendix 2. Prudential Indicators 3.12 The prudential indicators for 2022-23 are attached in Appendix 3. 4. CONCLUSION 4.1 In the period from 1 July 2022 to 31 August 2022, the Council’s borrowing decreased by £3.496m, it is currently below the Capital Financing Requirement. There are substantial internal balances, of which £117.4m is currently invested. The investment returns were 1.802% which is above the SONIA target of 1.641%. 5. IMPLICATIONS 5.1 Policy – None. 5.2 Financial – Complies with Annual Treasury Strategy. 5.3 Legal – None. 5.4 HR – None. 5.5 Fairer Duty Scotland – None. 5.5.1 Equalities – protected characteristics – None. 5.5.2 Socio-economic Duty – None. 5.5.3 Islands – None. 5.6 Climate Change – None. 5.7 Risk – None. 5.8 Customer Service – None. Kirsty Flanagan Section 95 Officer 12 September 2022 Policy Lead for Finance and Commercial Services - Councillor Gary Mulvaney
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Appendix 1 – Economic Background Appendix 2 – Interest Rate Forecast Appendix 3 – Prudential Indicators For further information contact Anne Blue, Head of Financial Services anne.blue@argyll-bute.gov.uk
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Appendix 1 – Economics Update (at 06-07-22) Latest update not yet received from Link Group therefore some information may be out of date and will be updated in the next reporting period. This section has been provided by Link Group and therefore includes their views and opinions of future trends and events. • The second quarter of 2022 saw: • GDP fall by 0.1% m/m in March and by 0.3% m/m in April; • An easing rather than a collapse in the composite Purchasing Managers Index (PMI); • A further rise in Consumer Price Index (CPI) inflation to a new 40-year high of 9.1% in May; • The first signs that the weakening in economic activity is filtering into a slightly looser labour market; • Bank Rate rise to 1.25%, taking it to its highest level since the Global Financial Crisis; • Gilt yields caught up in the global surge in bond yields triggered by May’s strong rise in US inflation; • Rising global bond yields and concerns over growth drive a global sell-off in equity markets. • Following the 0.1% m/m fall in GDP in March and the 0.3% m/m contraction in April, the economy is now moving towards a recession (two quarters of falling output in a row). Indeed, GDP would need to rise by 0.4-0.5% m/m in both May and June to prevent the economy from contracting in Q2 as a whole. That said, without the joint wind down of the COVID-19 Test and Trace and vaccination programme, GDP would have risen by 0.2% m/m and 0.1% m/m in March and April respectively. That’s hardly strong, but it suggests the underlying momentum is not quite as weak as the headline figures imply. • There is not much evidence that higher inflation and higher interest rates have yet become a big drag on activity. Services output did fall by 0.3% m/m in April. But output in consumer- facing services, conversely, rose by a solid 2.3% m/m in April. And although the Office for National Statistics (ONS) said that some of the 1.0% m/m fall in manufacturing output was linked to the drag on activity from higher prices, it also said that some of the 0.4% m/m drop in construction output in April was a drop back after the boost in the wake of February’s Storm Eunice. • The fact that the composite PMI didn’t fall in June also suggests that in Q2 (Apr – June) real GDP has softened rather than collapsed. The S&P Global/CIPS all-sector PMI for June was unchanged from its level of 53.1 in May, signalling tepid but positive growth. According to the Lloyd’s barometer, business confidence in May also remained remarkably resilient. • Despite the fall in the GfK composite measure of consumer confidence to a new record low of - 41 in June, April’s £1.4bn rise in consumer credit suggests households appear to have turned to credit to support their spending as the cost-of-living squeeze has intensified. Meanwhile, the household saving rate held steady at 6.8% in Q1 in line with its long-term average and we expect households to lower their saving rate further when the bigger falls in real incomes come in Q2 and Q3 to cushion the blow to spending. • The Chancellor’s latest fiscal support of £10.3bn (0.5% of GDP), which comprised £15.3bn of handouts to households, partly funded by a £5bn tax on the profits of oil and gas producers, will help support GDP in the second half of the year. And with the Prime Minister and the Chancellor desperately needing to boost their popularity, some tax cuts may be announced in the Autumn Budget.
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• There has been early signs that the recent weakening in economic activity is filtering through into a slightly looser labour market. The unemployment rate edged up from 3.7% in the three months to March to 3.8%. The single-month data showed that employment fell by 254,000 in April and the unemployment rate rose from 3.5% to 4.2%. And the upward march in the number of job vacancies slowed, with the three-month average only rising from 1.296m in April to 1.300m in May. A seasonal adjustment of the single-month data implies that vacancies fell in May for the first time since COVID-19 was rife in December. • At the same time, a 1.8% m/m fall back in average earnings in April meant that the 3myy rate of earnings eased from 7.0% in March to 6.8% in April. And a lot of the 0.5% m/m rise in earnings excluding bonuses was probably due to the 6.6% rise in the National Living Wage on 1st April. The 3myy rate of earnings excluding bonuses stayed at 4.2%. • That said, conditions in the labour market remain exceptionally tight. The unemployment rate is still close to its recent 47-year low, and there is the same number of unemployed people as job vacancies and at 6.8% in April, the 3myy rate of average earnings is at a 10-year high (although it is still falling in real terms) and is well above the 3.0-3.5% that is broadly consistent with the 2.0% inflation target (assuming that productivity growth is 1.0-1.5%). • CPI inflation rose from 9.0% in April to a new 40-year high of 9.1% in May and it is not yet close to its peak. The increase in CPI inflation in May was mainly due to a further leap in food price inflation from 6.7% to a 13-year high of 8.5%. With the influence of increases in agricultural commodity prices yet to fully feed into prices on the supermarket shelves, we think that food price inflation will rise above 10% in September. And with two-thirds of the observation period for the Ofgem price cap having now passed, something like a 40% rise in utility prices is pretty much baked in the cake for October. The further rise in core producer price inflation, from 13.9% to 14.8%, suggests that core goods CPI inflation will probably rise to 14% before long. We think that will take CPI inflation to a peak of around 10.5% in October. • The rise in services CPI inflation from 4.7% in April to 4.9% in May suggests that domestic price pressures are still strengthening. • There now seems to be an even greater likelihood that second-round effects, whereby high inflation feeds back into higher price and wage expectations, keep inflation higher for longer. For some time, the Monetary Policy Committee (MPC) has placed a lot of weight on the results of the Bank of England’s monthly Decision Maker Panel which asks businesses how they expect to change their prices and wages over the next year. May’s survey revealed that businesses still expect to raise their selling prices by 6.0% and their wages by 4.8% over the next year. Meanwhile, XpertHR said that pay settlements across the economy stayed at a 30- year high of 4.0% in May. The government appears to be contemplating raising public sector pay by up to 5%. And the 7.1% pay rise granted to some railway workers sets a high bar for the negotiations that led to train strikes across large parts of the country in mid-June. • The MPC has now increased interest rates five times in as many meetings and raised rates to their highest level since the Global Financial Crisis. Even so, coming after the Fed raised rates by 75 basis points (bps) in June and a handful of other central banks have recently raised rates by 50bps, the Bank of England’s action is relatively dovish. The MPC’s decision not to follow the Fed and raise rates by more makes some sense. The UK’s status as a larger importer of commodities, which have jumped in price, means that households in the UK are now facing a much larger squeeze on their real incomes. • But the MPC’s new guidance is that if there are signs of “more persistent inflationary pressures” it will, “if necessary act forcefully in response”. We expect the MPC to continue to
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raise rates in steps of 25bps rather than 50bps. We think the MPC will raise rates from 1.25% now to a peak of 2.75% next year. That’s higher than the peak of 2.00% forecast by economists, but lower than the peak priced into the financial markets. • Gilt yields have been caught up in the global surge in bond yields triggered by the surprisingly strong rise in CPI inflation in the US in May. The rises in two-year gilt yields (to a peak of 2.37% on 21st June) and 10-year yields (to a peak of 2.62%) took them to their highest level since 2008 and 2014 respectively. And in response to signs that central banks (particularly the US Fed) are going to raise interest rates faster to get on top of inflation, we now think that 10- year gilt yields will reach a peak of 2.70% (up from 2.39% currently) this year and into 2023. • While the S&P 500 is 8.4% below its level a month ago, the FTSE 100 is 5.7% below it. Part of the sell-off has been driven by the rapid rise in global bond yields and the resulting downward pressure on equity valuations as well as concerns over economic growth. • Finally, the pound has already weakened from $1.37 and €1.21 earlier this year to $1.21 and €1.16. A lot of these moves have been driven by concerns over the outlook for the global economy and the resulting poor performance of risky assets, which has increased the demand for the dollar relative to sterling. If interest rates rise faster and further in the US than in the UK, rate differentials and a worsening in risk appetite will push the pound even lower, from $1.21 now to $1.18 by the end of 2022. We don’t expect the pound to fall by as much against the euro (from €1.16 to €1.14 next year). But once global inflation and global interest rates peak, the pound will probably benefit from the return of risk appetite. It may rise to $1.25 by the end of 2023 and to $1.30 by the end of 2024. MPC meetings 5th May and 16th June 2022 • After the Bank of England became the first major western central bank to put interest rates up in this upswing in December, it has quickly followed up its first 0.15% rise by a further four 0.25% rises to 1.25%, in what is very likely to be a series of increases repeated throughout the rest of 2022 and into 2023. • In May, the MPC voted 6-3 vote in favour of a 0.25% increase, but not only was this the first time in its 25-year history that the MPC had raised rates at four meetings in a row but also three members (Haskel, Mann and Saunders) wanted a 0.5% hike (up from none in March). However, GDP growth was forecast to drop to -0.25% in 2023 (+1.25% previously) and only +0.25% in 2024 (+1.00% previously). Anyone for a recession? • Nonetheless, over Q2, it is clear central banks in the developed economies have placed the dampening down of inflation pressures front and centre of their primary objectives, even if it comes at the cost of sluggish growth or, indeed, recession (mild ideally but it is very difficult to micro-manage economic performance). The Monetary Policy Committee (MPC) is in step with this approach although, arguably, the UK economy is dragging its feet to a greater extent than that seen in the US. • What are the key factors for consideration? First, the CPI measure of inflation is already at 9.1%, and the Bank of England anticipates it will peak near to 11% just before Christmas. With the cost-of- living squeeze in full swing by that juncture, and unemployment likely to be ticking upwards, we judge that the Bank will pause following its March 2023 meeting and judge it has done enough so long as inflation starts to fall, albeit at a slow pace. To that extent, we can envisage the MPC waiting a full year before loosening the reins and starting to cut Bank Rate in spring 2024. However, given the number of geopolitical factors that could push this forecast off track, we would caution against taking a strong view on how interest rate
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movements evolve and instead focus on optimising balance sheet management and the risk management of investment and debt portfolios. • Regarding gilt yields, all developed economies have seen a considerable uplift in government bond yields across the whole curve since the start of 2022 and, in many ways, gilts have simply played catch-up of late. To that end, we have revised our PWLB forecasts upward and you will even see we have a 3.7% PWLB rate projected for the 25-year part of the curve in both 2022 and 2023. However, as headline inflation falls back, we project a slow reduction in gilt yields as investors acknowledge that price pressures are gradually coming under control. • At the 16th June MPC meeting, part of the reason for the Committee only seeing a 0.25% hike as necessary is the prevailing weak economic data. The vote was again 6-3 (the same as in May) but the words were more hawkish with the Bank strengthening its forward guidance. It deleted the previous phrase that “some degree of further tightening…may still be appropriate” and replaced it with “the scale, pace and timing of any further increases in Bank Rate will reflect the Committee’s assessment of the economic outlook and inflationary pressures” and that “the Committee will be particularly alert to indications of more persistent inflationary pressures, and will, if necessary, act forcefully in response.” • Whereas in May two members objected to the guidance that rates will rise further, it appears that all members are behind this new, stronger guidance. However, the growing evidence that firms’ price and wage expectations have become dislodged from the 2.0% target suggest that the Bank is between a rock and a hard place in navigating the appropriate monetary policy response. As always, the economic data will be key to anticipating whether our assumptions remain sound.
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Appendix 2 – Interest Rate Forecast The Council has appointed Link Group as its treasury advisors and part of their service is to assist the Council to formulate a view on interest rates. The PWLB rate forecasts below are based on the Certainty Rate (the standard rate minus 20 bps) which has been accessible to most authorities since 1st November 2012. The latest forecast on 21st June is compared below to the previous forecast (10th May). A comparison of these forecasts shows that PWLB rates have increased generally and show a speed up in the rate of increase in Bank Rate as inflation is now posing a greater risk. The increase in PWLB rates reflects a broad sell-off in sovereign bonds internationally as inflation concerns abound. To that end, the MPC has tightened short-term interest rates with a view to trying to slow the economy sufficiently to keep the secondary effects of inflation – as measured by wage rises – under control, but without pushing the economy into recession. Our current and previous PWLB rate forecasts below are based on the Certainty Rate (the standard rate minus 20 bps) which has been accessible to most authorities since 1st November 2012. • LIBOR and LIBID rates ceased for new contracts at the end of 2021. In a continuation of our previous forecasts, our money market yield forecasts are based on expected average earnings by local authorities for 3 to 12 months. • Our forecasts for average earnings are averages i.e., rates offered by individual banks may differ significantly from these averages, reflecting their different needs for borrowing short-term cash at any one point in time. A SUMMARY OVERVIEW OF THE FUTURE PATH OF BANK RATE • Our central forecast for interest rates was last updated on 21st June and reflected a view that the MPC will be keen to further demonstrate its anti-inflation credentials by delivering a 0.25% increase in Bank Rate in August, September, November, December, February and March i.e., the next six MPC meetings. Link Group Interest Rate View 21.06.22 Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 Sep-24 Dec-24 Mar-25 Jun-25 BANK RATE 1.75 2.25 2.75 2.75 2.75 2.75 2.50 2.50 2.25 2.25 2.25 2.25 3 month ave earnings 2.00 2.50 2.80 2.80 2.80 2.80 2.60 2.50 2.30 2.30 2.20 2.20 6 month ave earnings 2.50 2.80 3.00 3.00 2.90 2.90 2.80 2.70 2.60 2.50 2.40 2.30 12 month ave earnings 3.10 3.20 3.20 3.20 3.00 2.90 2.80 2.60 2.50 2.40 2.40 2.40 5 yr PWLB 3.20 3.30 3.30 3.30 3.30 3.20 3.10 3.00 3.00 3.00 2.90 2.90 10 yr PWLB 3.40 3.50 3.50 3.50 3.50 3.40 3.30 3.20 3.20 3.20 3.10 3.10 25 yr PWLB 3.70 3.70 3.70 3.70 3.70 3.70 3.60 3.50 3.50 3.40 3.40 3.30 50 yr PWLB 3.40 3.40 3.50 3.50 3.40 3.40 3.30 3.20 3.20 3.10 3.10 3.00 Link Group Interest Rate View 10.5.22 Jun-22 Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 Sep-24 Dec-24 Mar-25 Jun-25 BANK RATE 1.25 1.50 1.75 2.00 2.00 2.00 2.00 2.00 1.75 1.75 1.75 1.75 1.75 3 month ave earnings 1.20 1.50 1.70 2.00 2.00 2.00 2.00 2.00 1.70 1.70 1.70 1.70 1.70 6 month ave earnings 1.60 1.90 2.10 2.20 2.20 2.20 2.20 2.10 2.00 1.90 1.90 1.90 1.90 12 month ave earnings 2.00 2.20 2.30 2.40 2.40 2.30 2.30 2.20 2.20 2.10 2.10 2.10 2.10 5 yr PWLB 2.50 2.50 2.60 2.60 2.60 2.60 2.60 2.60 2.50 2.50 2.50 2.50 2.50 10 yr PWLB 2.80 2.80 2.90 2.90 2.90 2.90 2.90 2.90 2.80 2.80 2.80 2.80 2.80 25 yr PWLB 3.00 3.10 3.10 3.20 3.20 3.20 3.10 3.10 3.00 3.00 3.00 3.00 3.00 50 yr PWLB 2.70 2.80 2.80 2.90 2.90 2.90 2.80 2.80 2.70 2.70 2.70 2.70 2.70
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• The CPI measure of inflation is now forecast to rise to close to 11% in Q4 2022 and the MPC will be keen to stifle the prospect of average earnings data (6.8% y/y currently including bonuses) providing further upside risk to inflationary factors that are primarily being driven by supply-side shortages. • When Bank Rate reached 1% in May, the MPC indicated (no earlier than August) that it will also consider the extent to which it implements Quantitative Tightening (QT), primarily the selling of its gilt holdings. However, they are likely to take any such decision cautiously as they are already not refinancing maturing debt. • Notwithstanding the MPC’s clear desire to increase Bank Rate throughout 2022, negative real earnings, the 54% hike in the Ofgem energy price cap from April (to be followed by a potential 40%+ further increase from October), at the same time as employees (and employers) have incurred a 1.25% Health & Social Care Levy, growing commodity and food inflation plus council tax rises - all these factors will hit households’ finances hard. However, lower income families will be hit disproportionately hard despite some limited assistance from the Chancellor to postpone the full impact of rising energy costs. • Given the above outlook, it poses a question as to whether the MPC may shift into protecting economic growth if it flatlines or contracts through 2022. Accordingly, we remain tentative about whether the MPC will increase Bank Rate as far as the market is currently pricing in (3.25% in April 2023). • In the upcoming months, our forecasts will be guided not only by economic data releases and clarifications from the MPC over its monetary policies, but the on-going conflict between Russia and Ukraine, including the manner in which the West and NATO respond through sanctions and/or military intervention. Currently, oil, gas, wheat and other mainstream commodities have risen significantly in price and central banks will have to balance whether they prioritise economic growth or try to counter supply-side shock induced inflation. • On the positive side, consumers are estimated to be sitting on over £160bn of excess savings left over from the pandemic so that will cushion some of the impact of the above increases. However, most of those are held by more affluent people whereas lower income families already spend nearly all their income before these increases hit and have few financial reserves. PWLB RATES • The yield curve has steepened considerably through the quarter and PWLB 5 to 50 years Certainty Rates are, generally, in the range of 2.75% to 3.75%. • We view the markets as having built in, already, nearly all the effects on gilt yields of the likely increases in Bank Rate and the poor inflation outlook (although we thought that in May and markets went much further than expected in respect of the gilt market sell-off). • It is difficult to say currently what effect the Bank of England starting to sell gilts will have on gilt yields now that Bank Rate has gone to above 1%. Nothing will be decided before August, however, but the Bank is likely to act cautiously as it has already started on not refinancing maturing debt. A pure roll-off of the peak £875bn gilt portfolio by not refinancing bonds as they mature, would see holdings fall to about £415bn by 2031, which would be about equal to the Bank’s pre-pandemic holding. • Increases in US treasury yields over the next few months could add further upside pressure on gilt yields as they have done since the turn of the year.
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Appendix 3 – Prudential Indicators PRUDENTIAL INDICATOR 2022-23 2022-23 2023-24 2024-25 (1). EXTRACT FROM BUDGET Forecast Outturn Original Estimate Forecast Outturn Forecast Outturn Capital Expenditure £'000 £'000 £'000 £'000 Non - HRA 34,352 51,699 26,680 28,232 TOTAL 34,352 51,699 26,680 28,232 Ratio of financing costs to net revenue stream Non - HRA 2.70% 2.70% 4.56% 4.57% Net borrowing requirement brought forward 1 April * 309,092 292,303 333,145 348,569 carried forward 31 March * 333,276 333,145 348,569 364,975 in year borrowing requirement 24,184 40,842 15,424 16,406 In year Capital Financing Requirement Non - HRA 24,184 40,842 15,424 16,406 TOTAL 24,184 40,842 15,424 16,406 Capital Financing Requirement as at 31 March Non - HRA 333,276 333,145 348,569 364,975 TOTAL 333,276 333,145 348,569 364,975
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PRUDENTIAL INDICATOR 2022-23 2023-24 2024-25 (2). TREASURY MANAGEMENT PRUDENTIAL INDICATORS £'M £'M £'M Authorised limit for external debt - borrowing 228 252 272 other long term liabilities 120 121 116 TOTAL 348 373 388 Operational boundary for external debt - borrowing 223 247 267 other long term liabilities 117 118 113 TOTAL 340 365 380 Upper limit for fixed interest rate exposure Principal re fixed rate borrowing 190% 190% 190% Upper limit for variable rate exposure Principal re variable rate borrowing 60% 60% 60% Upper limit for total principal sums invested for over 364 days £20m £20m £20m (per maturity date) Maturity structure of new fixed rate borrowing during 2022/23 under 12 months 12 months and within 24 months 24 months and within 5 years 5 years and within 10 years 10 years and above upper limit lower limit 30% 0% 30% 0% 30% 0% 40% 0% 100% 0%
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 13 OCTOBER 2022 RESERVES AND BALANCES – UPDATE AS AT 31 AUGUST 2022 1 EXECUTIVE SUMMARY 1.1 The main purpose of this report is to advise Members of the overall level of reserves held by the Council as well as providing detail on the monitoring of the earmarked balances held within the General Fund. 1.2 The Council has a total of £364.558m unusable reserves that are not backed with resources. They are required purely for accounting purposes. 1.3 At 31 March 2022 the Council had a total of £103.626m of usable reserves. Of this: • £2.682m relates to the Repairs and Renewals Fund • £4.414m relates to Capital Funds • £96.530m was held in the General Fund, with £89.433m of this balance earmarked for specific purposes. 1.4 Of the earmarked balance of £89.433m: • £46.510m is invested or committed for major initiatives/capital projects • £4.094m has already been drawn down • £32.402m is still to be drawn down in 2022-23 • £6.427m is planned to be spent in future years Appendix 1 provides further information on the unspent budget earmarkings and Appendix 2 provides further information on the COVID earmarkings. 1.5 The Council’s General Fund contingency level is set at 2% of net expenditure for 2022-23 which equates to £5.256m. At the beginning of the financial year there was £1.841m of unallocated General Fund Balance (over and above contingency). At the Council meeting on 24 February 2022 it was agreed that the budgeted revenue surplus of £2.482m would be transferred into the general fund. After taking this into consideration and the current forecast outturn for 2022-23, the Council is estimated to have a £4.166m surplus over contingency.
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ARGYLL AND BUTE COUNCIL POLICY AND RESOURCES COMMITTEE FINANCIAL SERVICES 13 OCTOBER 2022 RESERVES AND BALANCES - UPDATE AS AT 31 AUGUST 2022 2. INTRODUCTION 2.1 This report outlines current balances on the Council’s reserves, both usable and unusable. It also provides detail on the monitoring of the earmarked balances within the General Fund. 3. DETAIL 3.1 Types of Reserves 3.1.1 Usable Reserves - Councils have powers to establish certain resource backed reserves which can be used to fund expenditure. The powers of councils to establish reserves are laid out in Schedule 3 of the Local Government (Scotland) Act 1975. These allow councils to establish a Renewal and Repairs Fund, Insurance Fund and Capital Fund. Councils can also establish a Useable Capital Receipts Reserve. The Council must also maintain a General Fund and can earmark balances for specific purposes within the General Fund. 3.1.2 Unusable Reserves – Councils are also required to establish certain reserves that are not backed by resources. They are required purely for accounting purposes and do not represent resources available for councils to utilise. The Pensions Reserve, Revaluation Reserve, Capital Adjustment Account, Financial Instruments Adjustment Account and Accumulated Absences Account are examples of unusable reserves. 3.2 Reserve Balances at 31 March 2022 3.2.1 The balances on each type of reserve at 31 March 2022 are set out in the two tables below, per the Unaudited Accounts for 2021-22. Unusable Reserves £000 Revaluation Reserve 145,903 Capital Adjustment Account 223,147 Financial Instruments Adjustment Account (2,198) Pensions Reserve 4,634 Accumulated Absences Account (6,928) Total Unusable Reserves 364,558 Usable Reserves £000 Repairs and Renewals Fund 2,682 Capital Fund and Usable Capital Receipts Reserve 4,414 General Fund 96,530 Total Usable Reserves 103,626 Total Reserves 468,184
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3.2.2 The Revaluation Reserve represents the unrealised gains in the valuation of fixed assets. The Capital Adjustment Account represents the difference between depreciation based on proper accounting practice and statutory charges for financing capital expenditure. The Financial Instruments Adjustment Account represents the difference between gains and losses on borrowing and statutory capital financing charges. The Pensions Reserve represents the difference between pension costs based on proper accounting practice and payments made for pension costs. The Accumulated Absences Account represents the costed difference between holiday pay entitlement and actual holidays taken at 31 March. 3.2.3 The Repairs and Renewals Fund was established to support funding of renewal and replacement of school equipment. Schools can only draw on the Repairs and Renewals Fund to the extent they have previously paid into the Fund and contributions must be contained within schools devolved budgets. 3.2.4 The Capital Fund was established to receive all capital receipts generated by the Council and can be used to support the capital plan or meet the principal repayments on loan charges. The Council decides as part of the budget process each year how it wishes to draw funding from the Capital Fund. 3.2.5 The Usable Capital Receipts Reserve relates to the accumulated unspent capital receipts from sale of council houses prior to transfer of the housing stock. The reserve forms part of the Council’s Strategic Housing Fund and can only be used for investment in social housing. The reserve will be used in accordance with the approach to investing in housing agreed by the Council in August 2012. 3.3 General Fund 3.3.1 The General Fund balance at 31 March 2022 can be analysed as follows: Balance 31/03/22 £000 Balance on General Fund as at 31 March 2021 78,245 Increase to General Fund balance at end of 2021-22 18,285 Earmarked Balances (89,433) Contingency allowance at 2% of net expenditure (5,256) Unallocated balance as at 31 March 2022 1,841 3.3.2 The General Fund includes balances that the Council has agreed to earmark for specific purposes. Some of these earmarked balances will be spent during the current financial year and some of them will be held over and spent in later years. The table below shows the balance at 31 March 2022, the amounts that are currently invested or set aside for major initiatives, the amount already spent and planned to be spent in the current year, the amount to be spent in future years and any sums no longer required to be earmarked. Appendix 1 provides further details on the breakdown of unspent budget earmarkings.
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Officers have reviewed and updated the spending profiles. Appendix 2 provides further details on the breakdown of COVID reserves. 3.4 Unallocated General Fund Balance 3.4.1 The Council’s General Fund contingency is set at 2% of net expenditure for 2022-23 and amounts to £5.256m. At the beginning of the financial year there was £1.841m of unallocated General Fund Balance (over and above contingency). After taking into consideration the budgeted allocation to the General Fund agreed by Council on 24 February 22 and the current forecast Earmarking Category Balance 31/03/2022 - per year end published report Transfers between categories Invested or committed for major initiatives /capital projects Drawn- down to 2022-23 Budget as at 31/08/22 Still to be drawn- down in 2022-23 Planned Spend Future Years Balance no Longer Required £000 £000 £000 £000 £000 £000 £000 Strategic Housing Fund 6,590 6,233 357 Investment in Affordable Housing 3,300 3,300 Capital Projects 24,722 24,722 Lochgilphead and Tarbert Regeneration 2,271 2,271 Support for Rural Growth Deal 1,058 1,058 Asset Management Investment 2,607 2,607 Piers and Harbours Investment Fund 1,643 1,643 Scottish Government Initiatives 3,141 2,754 387 CHORD 349 150 199 DMR Schools 1,982 416 1,566 Energy Efficiency Fund 218 218 Existing Legal Commitments 475 475 Unspent Grant 12,834 950 872 10,560 452 Unspent Third Party Contribution 166 10 156 Previous Council Decision - Other 4,343 -55 2,069 56 2,163 0 Redundancy Provision 1,732 500 1,232 Supporting Organisational Change 1,588 11 489 1,088 Spend to Save Route Optimisation 100 100 Timing Delay 499 499 Hermitage Park 4 4 COVID-19 9,407 257 1,737 7,354 59 Unspent Budget 10,404 55 1,400 635 5,414 3,010 Totals 89,433 0 46,510 4,094 32,402 6,427 0
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outturn position for 2022-23, the Council is forecast to have a £4.166m surplus over contingency. Heading Detail £000 Unallocated General Fund as at 31 March 2022 This is the balance that is unallocated over and above the 2% contingency, which amounts to £5.256m 1,841 Budgeted allocation to General Fund for 2022-23 Budget Per the Budget Motion at Council on 24 February 2022 2,482 Current Forecast Outturn for 2022-23 as at 31 August 2022 (157) Estimated Unallocated balance as at 31 March 2023 4,166 3.4.2 Note that the unallocated balance of £4.166m does not take into account the 2022-23 pay award currently in the final stages of negotiation. 3.5 Loans Fund Review 3.5.1 At the Council meeting on 27 February 2020, it was agreed that the one-off re- profiling gain of £20.561m generated by the loans fund review should be used partly to create a provision for the increasing principal repayments over the next 10 years (£7.649m) with the remainder of the gain (£12.912m) used to fund the known liabilities/cost pressures. The table below shows what has been drawn down against the one-off gain and the remaining balance. Agreed Allocation Transferred to Earmarked Reserves / 20-21 / 21-22 Budget Transferred to Earmarked Reserves / 22-23 Budget Balance Remaining £000 £000 £000 £000 Provision for the increasing principal repayments 7,649 7,649 Provision to Support Organisational Change 500 (500) 0 Estimated Cost of 2020-21 redundancies that are part of budget savings proposals 600 (600) 0 Future Redundancies Provision 1,500 (1,500) 0 Spend to Save Route Optimisation 100 (100) 0 Funding Gap in Capital Programme 2,619 2,619 Capital Programme Intolerable Red Risks 574 (574) 0 Campbeltown Flood Prevention Scheme 1,406 1,406 Significant Strategic Change Projects 5,013 (2,856) 2,157
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2020-21 Revenue Budget Contribution 600 (600) 0 20,561 (6,730) 13,831 4. CONCLUSION 4.1 The report outlines the overall reserves and balances for the Council covering the purpose and level of each reserve. It also provides detail as to expenditure against earmarked balances held within the General Fund. 4.2 As at 31 August 2022 the estimated unallocated General Fund, after taking into consideration the budget motion and forecast outturn for 2022-23 is £4.166m. 5. IMPLICATIONS 5.1 Policy - Earmarked funds and funds set aside for delivery of Single Outcome Agreement are available to support Council Policy. 5.2 Financial - Outlines the balances held with the Council’s usable and unusable reserves. 5.3 Legal - None. 5.4 HR - None. 5.5 Fairer Scotland Duty- None. 5.5.1 Equalities – protected characteristics - None. 5.5.2 Socio-economic Duty - None. 5.5.3 Islands - None. 5.6 Climate Change - None. 5.7 Risk - A contingency of £5.256m (equivalent to 2% of net expenditure) has been set aside as part of the general fund. This has been subject to a risk assessment. 5.8 Customer Service - None. Kirsty Flanagan Section 95 Officer 9 September 2022 Policy Lead for Finance and Commercial Services - Councillor Gary Mulvaney APPENDICES Appendix 1 – Earmarked Reserves breakdown of unspent budget Appendix 2 – Earmarked Reserves breakdown of COVID earmarkings For further information contact Anne Blue, Head of Financial Services anne.blue@argyll-bute.gov.uk
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APPENDIX 1 Earmarked Reserves - Unspent Budget As at 31 August 2022 Ref Department Service Description Opening Balance Budget Drawdown New earmarking during 22-23 Remaining Balance Still to be drawn down in 22-23 Planned to spend in future years Plans for Use Amount Planned to be Spent in 2022- 23 Amount Planned to be Spent in 2023- 24 Amount Planned to be Spent from 2023-24 onwards 001 Chief Executive's Unit Community Planning Communities and Partnership Team 8,855 8,004 851 851 0 The funds have originated from externally sourced income due to an employee being seconded to the Scottish Community Development Centre (SCDC). The funds will be used to support the team in relation to meeting its priorities of Building Back Better (Communities), Climate Change and the review of the Argyll and Bute Outcome Improvement Plan. 8,855 0 0 002 Chief Executive's Unit Community Planning Gaelic Development 8,235 8,235 8,235 0 To fund Gaelic specific work and project work of the Community Planning Partnership including the development of the new 10 year Outcome Improvement Plan 8,235 0 0 003 Chief Executive's Unit Financial Services Financial Systems 114,000 80,252 33,748 33,748 0 To fund the completion of the implementation of the Oracle Fusion Financial Management System, a software update for cash receipting to ensure card payments can still be taken and the procurement and implementation of a new system to manage the requirements of the IFRS16 Leases accounting standard. 114,000 0 0 004 Chief Executive's Unit Financial Services Accounting and Budgeting Team Resilience 95,000 64,336 30,664 11,664 19,000 To fund the implementation of a new staffing structure in 2022/23 as agreed at ELT on 12 April 2022. This will provide funding to cover the additional staffing costs in 2022/23 and the training costs over the period 2022/23 to 2026/27 76,000 5,000 14,000 005 Chief Executive's Unit Financial Services CIPFA 32,530 32,530 32,530 0 CIPFA Training - To fund the professional training costs for staff undertaking the CIPFA professional accountancy qualification. 32,530 0 0 006 Chief Executive's Unit Financial Services Scottish Government Funding - Welfare Reform/Discretionary Housing Payments (agreed at Council February 2014) 18,595 18,595 0 18,595 The Council was allocated additional funding of £550k from the Scottish Government late in 2013-14. This money was allocated to support the Community Learning and Development Team to provide courses to support Universal Credit claimants 2019/2020 to support the recruitment of casual tutors and the purchase and upgrade of laptops. The monies were not utilised however it will now be required to top up the Scottish Welfare Fund and DHP monies for 2022/23 as it is likely that given the current cost of living crisis that more people will be in need of support through these funds 0 18,595 0 007 Executive Director (Douglas Hendry) Across Services / Education Digital Projects (Supply Staff Booking System) 35,000 35,000 35,000 0 To deliver a number of Digital Service Transformation Projects, specifically in Education and Customer Support Services, but also to reserve a further amount to support priority digital transformation projects identified in Departmental ICT programmes, that have not yet started due to resource constraints. The specific projects include: Supply Staff Booking System £0.035m, Skype for Business (for Education) £0.030m, Enhancing Curriculum Choice and Equity of Provision £0.080m, Digital Customer Engagement Developments £0.073m, Replacement of Learning Management System £0.030m, Increase in Schools Bandwidth £0.063m and a general provision still to be allocated £0.189m 35,000 0 0 008 Executive Director (Douglas Hendry) Commercial Services Rothesay Pavilion Charity 750,000 750,000 375,000 375,000 Agreed at Council meeting February 2020, £750k additional revenue support subject to conditions which seek to minimise the risk to the Council as far as is reasonably practicable including requirement for adequate business and financial management and regular reporting by RPC. 375,000 375,000 0 009 Executive Director (Douglas Hendry) Commercial Services Demolition of former Lochgilphead Primary and Rothesay Secondary School 320,000 320,000 320,000 0 To fund the demolition of the former Lochgilphead Primary School and former Rothesay Academy (subject to the removal of the listing). 320,000 0 0 010 Executive Director (Douglas Hendry) Commercial Services Rothesay Pavilion Essential repairs 306,400 306,400 306,400 0 Essential repairs to deal with potential health and safety risks and to avoid further deterioration. Budget provision was approved by the Policy and Resources Committee on 21 August 2014. 306,400 0 0 011 Executive Director (Douglas Hendry) Commercial Services Estates - NDR Revaluation Appeals 84,688 84,688 84,688 0 The Council agreed to make provision to meet the cost of appealing Non Domestic Rates (NDR) revaluations which will be imposed from 1st April 2017. It was agreed that £150,000 be earmarked from the favourable 2016-17 outturn position to fund these appeals. The balance of £84,688 is still required as NDR valuation appeals have been lodged but have not been heard yet. We will not know the level of savings, and in turn the corresponding charge to us, until the appeals are concluded which should be later on this year. Ryden are awaiting outcome of further citations which will incur fees. 84,688 0 0 012 Executive Director (Douglas Hendry) Commercial Services Site Investigation Works 21,013 21,013 21,013 0 For Site Investigation works in relation to Tweeddale Street Car Park, Oban and Oban Airport Business Park to explore commercial opportunities to develop the sites and gain revenue income for Argyll and Bute Council. HUB North were instructed to procure contractors to undertake the site investigations and work commenced in March 2020. This is still ongoing. 21,013 0 0 013 Executive Director (Douglas Hendry) Commercial Services Catering and Cleaning Restructure Costs 17,000 17,000 0 0 0 To support the catering and cleaning team restructure 17,000 0 0 014 Executive Director (Douglas Hendry) Education Education Transformation Fund 187,526 24,677 162,849 162,849 0 At the Council meeting on 27 February 2020, it was agreed to input £400k into Education Digital Learning. The additional funds have been spent in 20/21 and 21/22, as part of the ongoing transformation work in the Education service, focussing on digital and virtual learning technology and the development of learning clusters. This will continue into 2022/23. 187,526 0 015 Executive Director (Douglas Hendry) Education Education Learning Estate Condition Surveys 77,440 77,440 77,440 0 To fund the delivery of School Core Facts (SCF) compliant Condition Surveys for prioritised School Buildings. 77,440 0 0 016 Executive Director (Douglas Hendry) Education Skype for Business for Education / Digital Projects (Skype for Business) 10,000 10,000 10,000 0 To fund the initial capital costs for the implementation of Skype for Business for Education. This will bring the Education service in line with other council departments and will improve staff collaboration and modernise school telephony to deliver the service more efficiently and cost effectively. A balance has been released back to the general fund because the rollout project is almost complete with only £0.01m expected spend in 22/23. 10,000 0 0 017 Executive Director (Douglas Hendry) Legal and Regulatory Services Education Purchasing Officers 210,000 210,000 90,000 120,000 The earmarked funds will be used to fund an education purchasing team within the Procurement Service for two years. The team will embed good procurement practice, train headteachers on current procurement process requirements, develop spend plans that evidence best value. 90,000 120,000 0 018 Executive Director (Douglas Hendry) Legal and Regulatory Services NDR - One off contribution to 22/23 Budget 200,000 200,000 0 0 0 To fund one off operational saving CS04 agreed for the 2022/23 budget. 200,000 0 0 019 Executive Director (Douglas Hendry) Legal and Regulatory Services NPDO Schools Contract 166,000 166,000 0 0 0 To fund one off operational saving LRS01 agreed for the 2022/23 budget 166,000 0 0
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Ref Department Service Description Opening Balance Budget Drawdown New earmarking during 22-23 Remaining Balance Still to be drawn down in 22-23 Planned to spend in future years Plans for Use Amount Planned to be Spent in 2022- 23 Amount Planned to be Spent in 2023- 24 Amount Planned to be Spent from 2023-24 onwards 020 Executive Director (Douglas Hendry) Legal and Regulatory Services Transformation Agenda QIO 100,259 74,274 25,985 -4,015 30,000 Ongoing funding for the QIO post to lead the implementation of the service transformation programme. The QIO will assist the Executive Director to deliver the Council’s transformation agenda by developing, analysing and monitoring initiatives and projects which deliver the vision, values and strategic objectives of the Council. 70,259 30,000 0 021 Executive Director (Douglas Hendry) Legal and Regulatory Services Digital Projects: Hybrid Council meetings 55,000 55,000 30,000 25,000 Per paper agreed at SMT October 2021 - allocation from Digital Projects (General Provision to be allocated). To fund the costs of livestreaming of Council meetings. 30,000 25,000 0 022 Executive Director (Douglas Hendry) Legal and Regulatory Services Councillor IT Equipment 65,000 65,000 65,000 0 To meet the cost of provision of IT equipment for all new Elected Members as a result of the Local Government Election in May 2022. 65,000 0 0 023 Executive Director (Douglas Hendry) Legal and Regulatory Services Debt Counselling & Welfare Rights 27,025 27,025 27,025 0 To meet the cost of a Debt Counselling and Welfare Rights Management System. 27,025 0 0 024 Executive Director (Douglas Hendry) Legal and Regulatory Services Community Safety Partnership 16,000 16,000 16,000 0 To earmark the Community Safety Partnership funding received for 2021/22 to be used for Community Safety Partnership purposes. 16,000 0 0 025 Executive Director (Kirsty Flanagan) Customer Support Services Microsoft 365 300,000 300,000 166,930 133,070 To be added to existing earmarked reserves to meet increasing MS365 licensing costs from 2022/23 onwards 166,930 133,070 0 026 Executive Director (Kirsty Flanagan) Customer Support Services Growing our Own and Modern Apprentices 109,150 109,150 109,150 0 Funding earmarked to support trainee development and modern apprenticeship opportunities based on priority workforce risk areas. These areas have been identified and proposals developed. £95,790 to be spent in 22/23 and £13,360 to be spent in 23/24 to fund a graduate trainee and 3 apprentices to deliver trainee development and modern apprenticeship opportunities 109,150 0 0 027 Executive Director (Kirsty Flanagan) Customer Support Services Security Operations Centre Subscription 76,455 76,455 0 76,455 There is a requirement to pay for a 3-year subscription at £60,000 per annum with a cost pressure being added to the ICT revenue budget to cover the costs from year 4 onwards. There is unallocated funding of £103,545 from the earmarking created at 2020/21 year end for 'Digital Projects', so the earmarking request for 2021/22 year end is the balance of £76,455 16,455 60,000 028 Executive Director (Kirsty Flanagan) Customer Support Services Learning and Development 36,508 36,508 36,508 0 In order to maximise the opportunities and efficiencies of digital learning, this funding will be used to support the extension of digital learning in order to deliver the Digital Learning Strategy, which was approved in FQ4 20/21. 36,508 0 0 029 Executive Director (Kirsty Flanagan) Customer Support Services Implementation of Gaelic Language P 30,000 30,000 30,000 0 Agreed at Council Meeting February 2021. Provision of funding for delivery and implementation of the council’s Gaelic Language Plan in recognition of the contribution that Gaelic makes to economic growth and to the tourism sector, and to enable delivery of key activities within the plan which currently receive no revenue funding. 30,000 0 0 030 Executive Director (Kirsty Flanagan) Customer Support Services Establishing HR Service Centre 30,000 30,000 18,000 12,000 To facilitate the implementation of technical efficiency improvements and new processes 18,000 12,000 0 031 Executive Director (Kirsty Flanagan) Customer Support Services Business Development Training 27,601 27,601 27,601 0 This budget is funding ongoing leadership development, coaching, action learning sets and commissioned training including Priority Management. 27,601 0 0 032 Executive Director (Kirsty Flanagan) Development and Economic Oban TIF (Tax Incremental Financing) 709,700 709,700 116,000 593,700 Will be used to fund the TIF Programme office for a further 3 years as well as the programme office for Rural Growth Deal beyond the funding that was agreed at Council for this in February 2021. 116,000 116,000 477,700 033 Executive Director (Kirsty Flanagan) Development and Economic Strategic Events & Festivals 115,764 115,764 115,764 0 At the Council meeting on 25 February 21, a decision was taken to agree £90k funding for Events and Festivals for 22-23, in order that the application process can commence during 21-22 and that this agreed figure be augmented by any underspend remaining from the 20-21 financial year. At 24 February 22, decision made to agree £90k for 23-24, in order that the application process can commence during 22-23 and that this agreed figure be augmented by any underspend remaining from the 21-22 financial year 115,764 0 034 Executive Director (Kirsty Flanagan) Development and Economic Island Post 50,461 50,461 50,461 0 To fund a temporary post at LGE11 to assist with the National Islands Plan Implementation Route Map 2020-2025 50,461 0 0 035 Executive Director (Kirsty Flanagan) Development and Economic Royal National Mod 40,000 40,000 20,000 20,000 One off funding allocation for the Royal National Mod agreed as part of the budget setting process for 2019-20. Grant contract issued. Proposed payment of £20k per annum starting 2020/21 (2023/24 final payment of £20k) 20,000 20,000 0 036 Executive Director (Kirsty Flanagan) Roads & Infrastructure Waste Variation Monies 1,492,997 1,492,997 640,000 852,997 This would be used to fund/part-fund various waste infrastructure projects that will support the council’s compliance with the 2025 ban on the Landfill of Biodegradable Municipal Waste, including the development of landfill cell construction works at Gartbreck. 640,000 426,000 426,997 037 Executive Director (Kirsty Flanagan) Roads & Infrastructure Climate Change 500,000 500,000 500,000 0 At the Council meeting on 27 February 20, it was agreed to input £500k budget to mitigate the impacts of weather related damage and climate change with specific emphasis on gully cleaning and drainage improvements. Spend has been delayed due to COVID and the intention is to spend the funds on 2 Gully Motors plus staff over next 2 years. Vehicles are on order and expected to be delivered in early 2022-23. 500,000 0 038 Executive Director (Kirsty Flanagan) Roads & Infrastructure 3G pitches / Tarbert Sports Pitches 427,286 427,286 89,373 337,913 In November 2018, the Council agreed to a maintenance funding package to be progressed for a number of 3G pitches including Tarbert. This funding will provide an estimated 6.5 years’ worth of ongoing maintenance up to 2025-26. 89,373 337,913 0 039 Executive Director (Kirsty Flanagan) Roads & Infrastructure Green Transport Initiatives 400,000 400,000 400,000 0 At the Council meeting on 27 February 20, it was agreed to input £400k in Green transport, investment in footway and cycle path maintenance supporting the healthy wellbeing and green agenda. Spend has been delayed due to COVID and this will be taken forward in 21-22. £260k Footways Reconstruction programme now agreed across the four areas, £140k Ardrishaig North Project. 400,000 0 040 Executive Director (Kirsty Flanagan) Roads & Infrastructure Waste Strategy 363,000 363,000 125,000 238,000 To fund/part-fund various waste projects that will support the council's compliance with the 2025 ban on the Landfill of Biodegradable Municipal Waste. 125,000 119,000 119,000 041 Executive Director (Kirsty Flanagan) Roads & Infrastructure Waste Management 256,753 256,753 256,753 0 Will be used towards long term waste management strategy/model, including but not limited to scoping work for the creating of a waste transfer station at Helensburgh. 256,753 0 0 042 Executive Director (Kirsty Flanagan) Roads & Infrastructure Replacement Signage and Bins 135,366 135,366 135,366 0 Replacing key road signage. This will help to reduce future budget pressures for replacement of signs and would also help to enhance the streetscape and general appearance of the area. The bulk of Road signs have been delivered and installation is now in progress and will be completed during 2022-23. 135,366 0 0 043 Executive Director (Kirsty Flanagan) Roads & Infrastructure Kintyre Recycling Redundancy Costs 36,000 36,000 36,000 0 To fund redundancy costs associated with Kintyre Recycling. 36,000 0 0 044 Executive Director (Kirsty Flanagan) Roads & Infrastructure Amenity Services introduction of man 28,099 28,099 28,099 0 Delay with introduction of amenity time recording system, spend unlikely to be incurred until 2022-23 for handheld devices and software. 28,099 0 0 045 Non Departmental Non Departmental Underwriting development of Rothes 1,000,000 1,000,000 1,000,000 0 Funding to meet additional costs identified as necessary for the refurbishment of Rothesay Pavilion. 1,000,000 0 0 046 Non Departmental Non Departmental Loans Fund 385,279 385,279 385,279 0 At the Council Budget meeting on 24 February 2022, Saving FS01, a Loans Fund Management/Operational saving for 22/23 budget of £0.500m was agreed with at least £0.200m to come from underspends in 21/22. The underspend position for 21/22 is £0.385m and this has to be earmarked to help offset the saving. 385,279 0 0 047 Non Departmental Non Departmental Utilities 283,000 283,000 283,000 0 To contribute towards the expected adverse impact on the 2022/23 budget of utility costs inflation as per Budget Pack 283,000 0 0
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Ref Department Service Description Opening Balance Budget Drawdown New earmarking during 22-23 Remaining Balance Still to be drawn down in 22-23 Planned to spend in future years Plans for Use Amount Planned to be Spent in 2022- 23 Amount Planned to be Spent in 2023- 24 Amount Planned to be Spent from 2023-24 onwards 048 Non Departmental Non Departmental Digital Projects (General Provision to 103,545 103,545 103,545 0 To deliver a number of Digital Service Transformation Projects, specifically in Education and Customer Support Services, but also to reserve a further amount to support priority digital transformation projects identified in Departmental ICT programmes, that have not yet started due to resource constraints. The specific projects include: Supply Staff Booking System £0.035m, Skype for Business (for Education) £0.030m, Enhancing Curriculum Choice and Equity of Provision £0.080m, Digital Customer Engagement Developments £0.073m, Replacement of Learning Management System £0.030m, Increase in Schools Bandwidth £0.063mand a general provision still to be allocated £0.189m. Further allocation to Hybrid Council Meetings agreed October 2021 (£0.085m). There is a proposal for 2021-22 year end to use the balance of this earmarking towards the Security Operations Centre Subscription unspent budget request - per Appendix 2.1l 103,545 0 0 049 Non Departmental Non Departmental Community Resilience Fund 76,447 76,447 76,447 0 Fund established in 2012/13 to be spent over more than one year. Fund reduced at the Council meeting on 11 February 2016 76,447 0 0 050 Non Departmental / Chief Executive's Across Services / Chief Execu Information Management (Balance of 209,844 209,844 209,844 0 To support a number of initiatives in respect of improving the Council's information management in line with the transformation agenda and increasing the pace of change as outlined in the BV Review. The planned initiatives include: Estates Survey work £122k, Digitalisation of Title Deeds £92k, document management and workflow system for Planning, Building Standards and Environmental Health £77k and a balance of funding to explore information management solutions in a strategic and coherent way £209k 209,844 0 0 051 Non Departmental / Executive Directo Across Services / Commercia Information Management (Estates Su 12,697 12,697 12,697 0 To support a number of initiatives in respect of improving the Council's information management in line with the transformation agenda and increasing the pace of change as outlined in the BV Review. The planned initiatives include: Estates Survey work £122k, Digitalisation of Title Deeds £92k, document management and workflow system for Planning, Building Standards and Environmental Health £77k and a balance of funding to explore information management solutions in a strategic and coherent way £209k 12,697 0 0 052 Non Departmental / Executive Directo Across Services / Legal and R Information Management (Digitalisat 92,000 92,000 61,000 31,000 To support a number of initiatives in respect of improving the Council's information management in line with the transformation agenda and increasing the pace of change as outlined in the BV Review. The planned initiatives include: Estates Survey work £122k, Digitalisation of Title Deeds £92k (delay on spending due to COVID-19), document management and workflow system for Planning, Building Standards and Environmental Health £77k and a balance of funding to explore information management solutions in a strategic and coherent way £209k 61,000 31,000 0 053 Non Departmental / Executive Directo Across Services / Customer S Digital Projects (Digital Customer Eng 73,000 73,000 73,000 0 To deliver a number of Digital Service Transformation Projects, specifically in Education and Customer Support Services, but also to reserve a further amount to support priority digital transformation projects identified in Departmental ICT programmes, that have not yet started due to resource constraints. The specific projects include: Supply Staff Booking System £0.035m, Skype for Business (for Education) £0.030m, Enhancing Curriculum Choice and Equity of Provision £0.080m, Digital Customer Engagement Developments £0.073m, Replacement of Learning Management System £0.030m, Increase in Schools Bandwidth £0.063m and a general provision still to be allocated £0.189m 73,000 0 0 054 Non Departmental / Executive Directo Across Services / Customer S Digital Projects (Increase in Schools B 63,455 63,455 63,455 0 To deliver a number of Digital Service Transformation Projects, specifically in Education and Customer Support Services, but also to reserve a further amount to support priority digital transformation projects identified in Departmental ICT programmes, that have not yet started due to resource constraints. The specific projects include: Supply Staff Booking System £0.035m, Skype for Business (for Education) £0.030m, Enhancing Curriculum Choice and Equity of Provision £0.080m, Digital Customer Engagement Developments £0.073m, Replacement of Learning Management System £0.030m, Increase in Schools Bandwidth £0.063m and a general provision still to be allocated £0.189m 63,455 0 0 055 Non Departmental / Executive Directo Across Services / Customer S Digital Projects (Replacement Learnin 11,470 11,470 11,470 0 To deliver a number of Digital Service Transformation Projects, specifically in Education and Customer Support Services, but also to reserve a further amount to support priority digital transformation projects identified in Departmental ICT programmes, that have not yet started due to resource constraints. The specific projects include: Supply Staff Booking System £0.035m, Skype for Business (for Education) £0.030m, Enhancing Curriculum Choice and Equity of Provision £0.080m, Digital Customer Engagement Developments £0.073m, Replacement of Learning Management System £0.030m, Increase in Schools Bandwidth £0.063m and a general provision still to be allocated £0.189m 11,470 0 0 056 Non Departmental / Executive Directo Across Services / Developme Information Management (Document 57,491 57,491 57,491 0 To support a number of initiatives in respect of improving the Council's information management in line with the transformation agenda and increasing the pace of change as outlined in the BV Review. The planned initiatives include: Estates Survey work £122k, Digitalisation of Title Deeds £92k, document management and workflow system for Planning, Building Standards and Environmental Health £77k and a balance of funding to explore information management solutions in a strategic and coherent way £209k 57,491 0 0 10,458,934 634,543 0 9,824,391 6,941,661 2,882,730 7,576,204 1,785,033 1,097,697
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APPENDIX 2 COVID Earmarkings As at 31 August 2022 Ref Department Service Description Opening Balance Budget Drawdown Released back to General Fund New earmarking during 22-23 Remaining Balance Still to be drawndown in 22- 23 Planned to spend in future years Plans for Use Amount Planned to be Spent in 2022- 23 Amount Planned to be Spent in 2023- 24 Amount Planned to be Spent from 2023-24 onwards 001 Chief Executive's Unit Community Planning Community Planning - temp post to support communities 55,000 55,000 55,000 0 As agreed at Policy & Resources committee on 9 December 2021, allocation of £0.055m to a post to support the economic and social recovery together with the building back stronger themes. 55,000 0 0 002 Chief Executive's Unit Community Planning COVID-19 - Test and Protect Support 44,047 10,000 34,047 34,047 0 Funding provided in relation to the Local Self-Isolation Assistance Service. The Community Planning and Development Team will work with community groups to support their community response and resiliency to Test and Protect and COVID-19 impacts 44,047 0 0 003 Chief Executive's Unit Financial Services LACER Fund 797,720 797,720 797,720 0 The Council meeting on 28 April 2022, it was agreed that Local Authority Covid Economic Recovery (LACER) Funding is to be used to distribute Scotland Loves Local cards to CTR recipients. This will take place in June 2022 giving Economic Development time to encourage the Co-op to sign up to accept the cards. 797,720 0 0 004 Chief Executive's Unit Financial Services Housing Benefits Private 673,867 673,867 673,867 0 Specific funding allocation for DHP to support tenants financially affected by the COVID-19 outbreak to sustain their tenancies. It is expected there will continue to be pressure on this budget going into 22- 23 673,867 0 0 005 Chief Executive's Unit Financial Services Flexible Food Fund 510,573 134,285 376,288 376,288 0 Financial Insecurity funding from Scottish Government routed into the Argyll and Bute Flexible Food Fund (ABFFF) is aimed at tackling financial insecurity for adults and families across Argyll and Bute. ABFFF offers financial support and wider confidential professional help to anyone suffering hardship. Working in partnership with the Community Food Forum, Bute Advice Centre and ALIenergy, households with low incomes and no access to cash savings can apply for immediate financial support. The Fund will help support daily living expenses. If the claimant engages with these services, a second payment will be made to contribute to a further months daily living expenses. In the period from 10 January 2021 to 30 April 2022 client gain in extra benefits income for families was £1.45 million with 1,090 families had been supported. The project has been extended to 31 March 2023 and this money will be used to support it. 510,573 0 0 006 Chief Executive's Unit Financial Services Flexible Funding for Supporting People while at Tier 4 COVID 167,983 42,961 125,022 125,022 0 Funding to strengthen local authority responses to meet emerging needs and support people in their communities struggling with the restrictions and guidance at all protection levels, particularly those at risk through health and social inequalities; this support could cover the same types of support currently delivered including information and advice, access to food and medicines, and practical and emotional support; and, administration costs to support delivery (e.g. strengthening the National Assistance Helpline) and liaison and co-ordination with 3rd sector. It will be for Local Government to use this funding flexibly for this purpose. 167,983 0 0 007 Chief Executive's Unit Financial Services Self Isolated Support Grant 16,000 16,000 16,000 0 Unspent admin funding for processing Self isolation Support Grants. Monies will be fully utilised in 2022/2023 to support the further administration of the grant until 31 March 2023. 16,000 0 0 008 Chief Executive's Unit Financial Services Test and Protect Extension 9,929 9,929 9,929 0 Funding provided in relation to the Local Self-Isolation Assistance Service. This will be used to support the recruitment of 0.5FTE LGE6 temp post to assist with call volumes in the Scottish Welfare Fund team in 2022/23 9,929 0 0 009 Executive Director (Douglas Hendry) Education Logistics Funding - Safe Opening of Schools 940,605 15,117 925,488 925,488 0 SG Funding to ensure the safe opening and operation of schools. Includes transport, PPE, Cleaning and expansion of estate. 940,605 0 0 010 Executive Director (Douglas Hendry) Education Additional Teaching/Support in Schools/Digital Devices/Family Home Learning Support Fund - £45m Grant - £45m 488,310 488,310 0 0 0 Continuation of funding for additional staffing, teachers, support staff, additional devices for pupils and additional family /home learning programmes. 488,310 0 0 011 Executive Director (Douglas Hendry) Education COVID 19 - Education Recovery - Additional Staff in School and ELC settings 373,346 373,346 0 0 0 To employ a variety of school staff to meet the needs of children and young people in their local areas and ensure that levels of teaching and support staff in schools can be maintained in the 2021-22 academic year. Funding will also be used to support the transition from ELC to primary school. 373,346 0 0 012 Executive Director (Douglas Hendry) Education Education to Support Young People 321,816 243,124 78,692 19,452 59,240 As agreed at the Council Meeting on 25 February 2021 with an original allocation of £0.600m. Agrees to fund a package of measures to boost the wellbeing and build back the resilience of young people, in particular those most vulnerable, following the Covid-19 pandemic, including counselling and increased provision of childcare for children under three. Notes that the Scottish Government is yet to confirm details of funding for similar initiatives and, should our investment in children’s wellbeing qualify for this funding, the balance will be re-allocated to the Recovery and Renewal Fund. 262,576 59,240 0 013 Executive Director (Douglas Hendry) Education Recruitment of Additional Teachers and Support Staff in Schools 136,715 136,715 0 0 0 Fund additional teachers and support staff. 136,715 0 0 014 Executive Director (Douglas Hendry) Education EDU - Community Mental Health and Wellbeing Support to Children and Young People - Pandemic Funding 49,756 49,756 49,756 0 Scottish Government/COSLA Initiative to support the work under the Children and Young People's Mental Health and Wellbeing Programme grant split in 2020-21 with £183,750 of the fund utilised by local collaborative partnerships for supporting children, families and carers through the pandemic. The Scottish Government has agreed for the balance to be spent in 2022/23. 49,756 0 0 015 Executive Director (Douglas Hendry) Legal and Regulatory Services Welfare Rights Support 172,000 172,000 172,000 0 As agreed at the Council Meeting on 25 February 2021 - an allocation of £0.172m. As part of our focus on Improving Opportunities for People and Communities, agrees to provide additional resources to proactively support people experiencing poverty and hardship, by investing in two additional Welfare Rights support staff for two years. 172,000 0 0 016 Executive Director (Douglas Hendry) Legal and Regulatory Services LACER Funding - Advice Services 130,000 130,000 0 0 0 Local Authority COVID Economic Recovery (LACER) Funding for Welfare Rights - ALI Energy, Bute Advice, Citizens Advice 130,000 0 0 017 Executive Director (Kirsty Flanagan) Customer Support Services Self Isolated Support / Self Isolated Support Grant (HR) 115,000 115,000 115,000 0 These were monies that were provided by Scotgov to fund additional overtime and resources for Shielding/Caring for People and Test and Protect activities, however low infection rates and therefore demand in A&B meant that this was not required in 2020/21 or 2021-22. The 2021-22 funding of £43,000 will be used for Recovery related activities including the recruitment of a Temporary Additional Web Developer to implement the improvements identified by customers in the Customer Engagement Consultation and to mainstream the Coronavirus page content back in to Business as usual. Another portion will be used to fund the Digital Receptionist solution as part of safe re-opening of offices. The 2021-22 funding of £72,000 will be used to fund consultancy and development of RPA (robotic process automation) software which will build automation within HR workflows and processes. This will improve efficiency and accuracy. 115,000 0 0 018 Executive Director (Kirsty Flanagan) Development and Economic Growth Staycation and Marketing Argyll and Bute 592,013 106,368 485,645 485,645 0 As agreed at the Council Meeting on 25 February 2021 with an original allocation of £0.800m. This will include provision of additional waste disposal facilities and other facilities that will be informed by the Motorhome and Informal Camping Survey. 592,013 0 0
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Ref Department Service Description Opening Balance Budget Drawdown Released back to General Fund New earmarking during 22-23 Remaining Balance Still to be drawndown in 22- 23 Planned to spend in future years Plans for Use Amount Planned to be Spent in 2022- 23 Amount Planned to be Spent in 2023- 24 Amount Planned to be Spent from 2023-24 onwards 019 Executive Director (Kirsty Flanagan) Development and Economic Growth Tackling Digital Exclusion Top-Up Fund 250,000 250,000 250,000 0 As agreed at the Council Meeting on 25 February 2021. Establishes the Tackling Digital Exclusion Top Up Fund to support communities and in some cases individuals that are missing out on national programmes due to logistics and economies of scale. While vouchers are available from the UK and Scottish Governments in some cases these do not cover the full cost of infrastructure builds. 250,000 0 0 020 Executive Director (Kirsty Flanagan) Development and Economic Growth LACER Funding (Small Business Development Grant) 200,000 200,000 200,000 0 Local Authority COVID Economic Recovery Fund grant. This funding will provide funding of between £500 and £5,000 to help existing micro and small businesses to improve their resilience or growth via projects to implement green initiatives, implement digital development, implement marketing improvements and improve efficiency/innovation. 200,000 0 0 021 Executive Director (Kirsty Flanagan) Development and Economic Growth LACER Funding (Sector Support Grant) 150,000 150,000 150,000 0 Local Authority COVID Economic Recovery Fund grant. This will provide funding, either part of the small business development grant or standalone, to help micros and small business to implement projects that contribute to the sector as well as benefitting the business, for example: Tourism and hospitality, food and drink or retail. With option to provide additional business support to hard hit areas including Bute and Kintyre where unemployment remains higher than average - support via specialist advice, locally tailored grants to meet local priorities and targeted marketing activity. 150,000 0 0 022 Executive Director (Kirsty Flanagan) Development and Economic Growth LACER Funding (New Enterprise Support Grant) 120,000 120,000 120,000 0 Local Authority COVID Economic Recovery Fund grant. This funding would provide £3,000 grants to help new businesses start up and establish. 120,000 0 0 023 Executive Director (Kirsty Flanagan) Development and Economic Growth Staycation Investment per budget pack February 22 100,000 100,000 100,000 0 As agreed at Council on 24 February 2022, Staycation investment £0.100m. Augments the 2021/22 £0.5m staycation initiative with an additional investment of £100k, including support for community groups and partners in the provision of facilities which can support increasing staycation visitor numbers during the 2022/23 season. 100,000 0 0 024 Executive Director (Kirsty Flanagan) Development and Economic Growth Economic Development - temp post to support economic recovery 55,000 55,000 55,000 0 As agreed at Policy & Resources committee on 9 December 2021, allocation of £0.055m to a post to support the economic and social recovery together with the building back stronger themes. 55,000 0 0 025 Executive Director (Kirsty Flanagan) Development and Economic Growth EH Covid Posts 41,145 41,145 41,145 0 Funding for 2 posts for 2 years and not recruited until late 20-21 41,145 0 0 026 Executive Director (Kirsty Flanagan) Development and Economic Growth LACER Funding (Shop Local) 40,000 40,000 40,000 0 Local Authority COVID Economic Recovery Fund grant. This funding would provide funding to continue the Shop Local scheme into 2022-23 and 2023-14, buying additional cards and allow the cards to gather momentum and support local businesses. 40,000 0 0 027 Executive Director (Kirsty Flanagan) Development and Economic Growth Tenant Hardship Fund 30,000 30,000 30,000 0 Grant received from Scottish Government to support tenants suffering hardship due to COVID-19. Claims have been made and Housing are in the process of paying these out and all claims will be settled during 2022-23. 30,000 0 0 028 Executive Director (Kirsty Flanagan) Development and Economic Growth LACER Funding (Gypsy Travellers) 10,000 10,000 10,000 0 Local Authority COVID Economic Recovery Fund grant. This funding would pay for MECOPP (Minority Ethnic Carers of People Project) to engage with the Gypsy Travellers community on the important subject of the cost of living increases, fuel poverty and the impact of factors such as their remote rural locations and the facilities available to them for everyday living have on their livelihoods 10,000 0 0 029 Non Departmental Across Departments COVID Cost Pressures Beyond 2021/22 370,000 370,000 370,000 0 As agreed at the Council Meeting on 25 February 2021 (£2.5m) with the value reduced to £0.370m based on more up to date projections at year end 2021-22. Allocation of COVID funding to projected 22/23 Revenue Cost Pressures 370,000 0 0 030 Non Departmental Non Departmental Recovery and Renewal Fund 1,547,000 1,547,000 1,547,000 0 As agreed at Council on 24 February 2022, Recovery and Renewal Fund £1.547m. This is provision for future recovery, regeneration and renewal, as well as any future pressures which may arise following the Covid-19 pandemic through a dedicated Recovery and Renewal Fund. Proposals for use of this fund to be brought forward by officers to the Policy and Resources Committee. To include in the first instance options for maximising Argyll and Bute’s potential as a green, connected staycation destination of choice, requesting that officers bring to the Environment, Development and Infrastructure Committee a report on use of external funding sources and other opportunities for improving the electric vehicle charging network. 1,547,000 0 0 031 Non Departmental Non Departmental Unallocated Admin Support Grant 411,285 411,285 411,285 0 Funding to support the delivery of the Business Grants to local businesses, partially used during 20/21 and 21/22 but a balance remains to be carried forward and used in future years 411,285 0 0 032 Non Departmental Non Departmental Capital pressure 257,000 257,000 257,000 0 Pressure identified on the 20-21 COSLA COVID costs spreadsheets - requires to be earmarked to be drawn down when required against the Capital Plan 257,000 0 0 033 Non Departmental Non Departmental Levelling up Fund bids per P&R February 22 150,000 150,000 150,000 0 As agreed at Policy & Resources committee on 17 February 2022, an allocation of up to £0.150m to support Levelling Up Fund bids 150,000 0 0 034 Non Departmental Non Departmental CHARTS per budget pack February 22 75,000 50,000 25,000 25,000 0 As agreed at Council on 24 February 2022, investment in CHARTS £0.075m. To support the organisation in delivering targeted support, in communities, to the culture, arts and heritage sector as part of its plans to contribute to overall economic recovery. 75,000 0 0 035 Non Departmental Non Departmental CHARTS 7,000 7,000 0 0 0 As agreed at the Council Meeting on 25 February 2021. Allocation of COVID funding to CHARTS £0.067m, with the balance of £0.007m being carried to 2022/23. The allocation is to ensure that Argyll and Bute’s culture, heritage and arts sector can make a contribution to our overall recovery and renewal. 7,000 0 0 9,408,110 1,737,226 0 0 7,670,884 7,611,644 59,240 9,348,870 59,240 0