Agenda item

To consider the report of the Director of Resources on the Provisional Revenue Outturn for 2014/2015 compared with the approved budget and the capital expenditure in the year ended 31 March 2015 with sources of funding.

Mr Steve Thompson, Director of Resources presented a report on the Provisional Revenue Outturn for 2014/2015. He highlighted the key features of the report, noting that in addition to the focus of previous years’ reports on revenue and the Council’s capital programme, the report included an emphasis on income collection.

Mr Thompson summarised that there was an increasing volatility to service budgets as a result of budget cuts, explaining that there had been a net service overspend of £2,346,000. He advised the Committee of the main variances of the overspend, highlighting the £1,601,000 overspend in Children’s Services and explaining that the reasons for the overspend in this service were due to the continuing high numbers of looked after children and a shortfall in Education Services Grant income due to academy conversions.

Members questioned how the Council was able to write off £2,583,000 so that services could enter the new financial year in a balanced position and were advised that the write off had been met through Treasury Management savings of £1,816,000 and the use of contingencies. Concerns were raised over the savings target of £25 million for 2015/2016.

The Committee was also provided with details of overspends in Community and Environmental Services and Adult Services. Members challenged the reasons for the apparent overspend on prudential borrowing costs associated with Project 30. Mr Thompson responded with details of the costs and savings involved in Project 30 and advised that a written summary of the financial modelling involved in the project could be circulated amongst Committee Members.

Members considered the financial outturn for budgets ‘outside the cash limit’ and queried the reasons for the overspend in Parking Services, with particular reference to the low level of use at the Devonshire Road car park. It was reported that a strategic parking review was being undertaken, which would investigate how to make it easier for visitors to make payments with the objectives of improving accessibility to park and pay for it.

A further question was raised by the Committee in relation to the localisation of business rates and whether the Council had been adversely affected. Mr Thompson explained that the financial risks to the Council stemmed from the appeals provision, estimating that approximately five to six per cent of appeals had been successful to date. Members noted that there had been a substantial increase in the appeals provision due to the large volume of appeals submitted before 31 March 2015, as that date was the end of a five year period where successful appeals could be backdated. Mr Thompson advised that the impact of those appeals were reflected in the Collection Fund for 2014/2015 but would not fully impact upon the Council until 2016/2017 due to the methodology used by central government to collect and apply the data.

Members noted the Council Tax collection rate for the past two financial years and challenged whether a target of 98 per cent was appropriate. Mr Thompson advised that the target figure was established in light of the reductions in discount and the introduction of the Local Council Tax Reduction Scheme and that over a five-year period the 98 per cent target collection rate was being achieved. However, the in-year collection rate was lower than the target, which was considered to be as a result of the profile of the town. He noted that work was being undertaken to consider this issue further.

The Committee considered the level of expenditure incurred by the Council on its 2014/2015 Capital Programme. Mr Thompson advised that the total capital expenditure had been £43,409,327, which was still considered relatively large for a local authority of Blackpool’s size.

The Committee agreed:

1.      To note the content of the report; and

2.      To request that a written summary of the financial modelling involved in Project 30 be circulated amongst Committee Members.

Background papers: None.