Issue - meetings

The Portfolio Holder for Corporate Governance, Finance and Resources to submit a report providing information on actual expenditure and income incurred on the Housing Revenue Account (HRA), compared to the latest approved budget for the period 1 April to 30 September 2021 for revenue and capital budgets.

Cabinet NOTED the financial position on the Housing Revenue Account (HRA) as at 30 September 2021 and the year-end forecast for both revenue and capital.

Dawn Garton, Director for Corporate Services introduced the report, the purpose of which was to provide information on actual expenditure and income incurred on the Housing Revenue Account (HRA), compared to the latest approved budget for the period 1 April to 30 September 2021 for revenue and capital budgets.

Mrs. Garton advised that there was a forecasted £370k underspend on revenue (as detailed at paragraph 5.6.1), which would result in a reduced contribution from the reserves in order to maintain the working balance at the agreed level of £750k.  The underspend was primarily due to underspending on employee costs, as a result of vacancies and also professional fees, due to lower prices being procured for work than was originally estimated.  These savings were offset from the loss of income on voids but still resulted in the overall underspend.  Concerning capital, there was a forecasted underspend of £2.7m.

Mrs. Garton confirmed that work continued at pace on the development of the Housing Revenue Account (HRA) business plan, which would be submitted to Cabinet in the New Year.  This, together with the work undertaken by the Development Manager would help inform the Capital Programme as it developed for future years.

Councillor Ronnie de Burle, Portfolio Holder for Corporate Governance, Finance and Resources commented that underspends on revenue and capital were sizable, perhaps as a result of overenthusiastic budgeting.  The HRA business plan would reveal the financial status of the HRA and would be critical to informing the future strategic direction of the HRA and the affordability of any plans which come from it.  Future revenue and capital budgets would then be set and properly considered alongside a long term financial plan.

During discussion the following points were noted:

·         It was clarified that the ‘late invoicing’ referred to at paragraph 5.7 of the report related to invoices being received by the Council.  The work on the HRA had been undertaken with the understanding that the Council had not been invoiced for some work it had commissioned and the forecasted position had allowed for this.

(DECISION: NON-KEY)

Cabinet NOTED the financial position on the Housing Revenue Account (HRA) as at 30 September 2021 and the year-end forecast for both revenue and capital.

Reason for the recommendation

The Council, having set an agreed budget at the start of the financial year, needs to ensure that the delivery of the budget is achieved. Consequently there is a requirement to regularly monitor progress so that corrective action can be taken when required, which is enhanced with the regular reporting of the financial position.