Agenda item

The Scrutiny & Overview Committee is presented with the Period 6 Financial Performance Monitoring report (Period 7 to follow) for its information. The Committee is asked to: -

1.  Review the information provided in the report on the 2023-24 Period 6 & 7 Financial Performance Reports, and

2.  Consider its conclusions on the latest budget position for 2023-24

3.  Consider whether there are any recommendations to bring to the attention of the Mayor.

The Committee considered a report on pages 5 to 42 of the agenda that provided an overview of the latest budget position for 2023-24 up until the end of Period 6 (September 2023). This report was included on the agenda as part of the Committee’s ongoing scrutiny of the delivery of 2023-24 budget.

The Cabinet Member for Finance, Councillor Jason Cummings, Section 151 Officer, Jane West, Director of Finance, Allister Bannin and Head of Strategic Procurement, Scott Funnell were in attendance for this item at the meeting.

The Chair advised the meeting that it had been hoped the Period 7 (October 2023) report would be available for the Committee’s consideration, but unfortunately it had not been cleared in time. As such the Chair had asked the Director of Finance, Allister Bannin to provide an update on the key changes to the Budget since the Period 6 report. During this update, the following was noted.

• The projected year end overspend across service directorates had been reduced from £5.7m in Period 6 to £1.5m in Period 7.
• The forecasted budget for the Adult Social Care & Health service had moved from a £0.2m overspend to a £1m underspend due to continuing work on pricing and placement costs.
• The projected overspend with the Childrens service had been reduced from £5.8m to £5.4m due to its ongoing work on high-cost placements.
• The projected underspend within the budget for the Assistant Chief Executive’s Directorate had moved from £0.5m to £0.9m due to an underspend within IT.
• The budget forecast for the Housing service had moved from a £2.2m overspend to a balanced position due to the transfer of funds from the Corporate economic demand pressures budget to address the additional emergency accomodation pressures.
• It was anticipated that the forecasted overspend of £1.5m could be offset from the Corporate Contingency fund.
• The Housing Revenue Account (HRA) revenue budget forecast remained at a £12m overspend due to the backlog of historic legacy repair work, reducing voids and the need to resolve issues experienced nationally including damp and mould and fire safety. The HRA capital budget forecast remained at £5.8m, which could be attributed to the cost for undertaking bigger repairs to properties.

As the Period 7 report had not been available, the Committee agreed to only allocate a short period for questioning the information provided. The first question asked whether the savings within the Adult Social Care and Health service could in part be attributed to staff vacancies. It was advised that the forecasted budget for staffing within the service had remained the same since Period 6 and it was the budget for placements that had improved. It was highlighted that there were a number of areas across the Council where it was a challenge to attract staff, including social care, which was a national issue and not unique to Croydon. 

An update was requested on the conversations with the Government to find a solution to the Council’s debt burden. It was advised that the discussions had not progressed to the stage where a solution had been identified and the Council was still having to manage its own finances, with the extraordinary support provided through the Government granting permission for capitalisation. There was an ongoing conversation about possible options for the debt which included restructuring and providing lower interest rates on the borrowing, as well as the debt write-off that had been requested. The challenge for the Government was to find a solution that would also work for other boroughs that were experiencing financial difficulty. 

At the conclusion of this item, the Committee agreed to defer its conclusions on the item, until it had the opportunity to review the full report at its next meeting on 12 February 2024.