Agenda item

To consider a report by Councillor Julian Thompson-Hill, Lead Member for Finance, Corporate Plan and Performance (copy enclosed) detailing the Council’s revenue position and seeking Cabinet approval of the proposed treatment of balances.

RESOLVED that –

(a)       Cabinet notes the final revenue outturn position for 2015/16 and approves the proposed treatment of reserves and balances as detailed in the report and Appendices 1, 2 and 3 attached to the report, and

(b)       Cabinet set up a task and finish group to review the level of school balances and understand the factors contributing to those levels.

Councillor Julian Thompson-Hill presented the report on the final revenue outturn position for 2015/16 and proposed treatment of reserves and balances.

Members were guided through the detail of the report and appendices.  In brief the overall outturn position showed an underspend against the approved budget which, together with a better than forecast council tax yield, strengthened the Council’s financial position.  Consequently it was possible to make recommendations for services to carry forward balances and make transfers to specific reserves that would assist in addressing the financial pressures of the next few years.  Whilst there was an overall underspend across individual services and corporate areas the schools delegated budget showed a (predicted) significant overspend.  The final position on service and corporate budgets (including schools) was an overspend of £0.387m which was 0.2% of the net revenue budget.  Reference was also made to the transfers to and from earmarked reserves and Cabinet’s attention was drawn to a number of year-end transactions recommended for approval.

Cabinet was advised of the positive outcomes in that the Council had been in a position to set up various reserves and carry forward funding in order to meet service requirements whilst also delivering the majority of the savings target for 2015/16.  The reserves which had been built up to deliver the Corporate Plan had been significantly reduced this year as those commitments continued to be progressed.  Finally reference was made to the risks surrounding school balances given the worsening financial position for schools.

The following matters were raised during the ensuing debate –

·         there was some discussion on the financial impact on schools due to a reduction in grant funding from Welsh Government, particularly in terms of the foundation phase which had a significant impact on infant schools, and there were also issues regarding demography and funding for additional learning needs.  It was noted that schools in financial deficit would be subject to financial recovery plans and reference was also made to the role of the Schools Budget Forum in supporting schools.  However, the importance of ensuring all schools were working effectively going forward was highlighted in order to plan ahead for future challenges with other schools concerned over future finances.  Members agreed there was a need to understand all the factors contributing to the position on school balances and felt that more work should be carried out to ascertain the current and future position for schools.  It was agreed that Cabinet take on that role by establishing a task and finish group which should also include scrutiny representatives.  It was noted that the Council had exceeded the statutory level of protection given to schools over the last 4/5 years and that funding per pupil in Denbighshire was higher than in neighbouring local authorities.  The need to provide support to schools and school governors was also highlighted

·         reference was made to the review of the Home to School Transport Policy being considered by Communities Scrutiny Committee later in the week and the potential financial implications arising from changes to the existing policy.  The Chief Finance Officer advised that whilst an indicative figure had been provided, a more precise cost estimate of implementing the policy would not be available until October/November 2016.  The Chief Executive stressed the importance of ensuring a fair and legal policy was in place advising that the quality of the policy should not be compromised due to budget implications.  Councillor Meirick Davies stressed the importance of consultation with parents during the review process and suggested collaboration opportunities be explored with neighbouring authorities.  Councillor Arwel Roberts detailed his concerns regarding the route for pupils from Rhuddlan to Ysgol Dewi Sant, Rhyl and his attempts to resolve the issue.  Councillor Eryl Williams suggested that, in cases which did not quality for statutory provision, schools should seek external funding for school transport provision

·         Cabinet considered whether there would be merit in publishing the income and operating costs of individual leisure centres given their financial sustainability.  It was noted that extracting the relevant costings might prove difficult given that the leisure centres were managed as separate entities and that income levels from leisure centres linked to schools would not be as high.  It was agreed that the Council could be more transparent in publishing such information but there would be a need for provisos to ensure the figures were not misleading.

RESOLVED that –

(a)       Cabinet notes the final revenue outturn position for 2015/16 and approves the proposed treatment of reserves and balances as detailed in the report and Appendices 1, 2 and 3 attached to the report, and

(b)       Cabinet set up a task and finish group to review the level of school balances and understand the factors contributing to those levels.