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ITEM EX5

EXECUTIVE – 11 NOVEMBER 2003

OVERVIEW OF REVENUE MONITORING AND CAPITAL PROGRAMME REPORTS

Report by Head of Finance

  1. The Executive considered the Monthly Revenue Monitoring Report on 28 October. At that time two items were left for consideration at this meeting when the funding position on the capital programme had been established.

  2. The two items were in relation to the proposal to make an advance payment to the Social & Health Care pooled budget in 2003/04 (see separate report – EX7) and whether it will be possible to set aside the requirement for the transport revenue/capital switch of £1m in 2003/04 (described in the Director of Environment & Economy’s report to the 28 October meeting). The Executive now needs to consider whether or not the Council can afford to agree to the requests.

  3. The transport revenue/capital switch of £1m is the second phase of a policy to utilise capital resources totalling £3m to assist the revenue budget in 2002/03. The £3m is to be repaid to the Transport Capital Programme in 2004/05 and 2005/06 by £1.5m each year. The impact of agreeing that the revenue/capital switch does not go ahead will be to reduce balances by £1m in 2003/04 but could be recouped by reducing the budget contribution to the capital programme to £0.5m in 2004/05 and adding the £1m this releases to balances.

  4. The Social & Health Care advance payment of £1m to the pooled budget in 2003/04 would be offset by a reduced payment to the pooled budget of £1m in 2004/05.

  5. The Monthly Monitoring Report highlighted a consolidated balances/key reserves forecast position of £3.7m at 31 March 2004. This is before either of the requests above are taken into account. It also indicated a potential deficit on Schools Balances of £2.8m at that date. If school balances do actually go into deficit by £2.8m at the end of 2003/04 the overall balance available to meet all other pressures during 2003/04 will reduce to £0.9m.

  6. The Capital Programme report elsewhere on this agenda indicates a balanced programme for 2003/04.

  7. The position on key balances does not allow much flexibility in relation to the outstanding requests from Social & Health Care and Environment & Economy and indeed other pressures that may surface during the remaining 5 months of the financial year.

  8. My current advice as S.151 officer based on the above information would be not to agree to either request. Further updated information on school balances and other items is, however, being sought and can be taken into account.

    9. RECOMMENDATION

  9. I therefore RECOMMEND that the Executive determines the matter on the day based on all information then available.

CHRIS GRAY
Head of Finance

Contact Officer: Mike Petty Tel: (01865) 815622

November 2003