Agenda item

The report was introduced by Dave Hodgkinson, Corporate Director of Resources, Rachel Harrison, Deputy Director of Finance, and Councillor Ward, Executive Member for Finance, Planning and Performance.

The following main points ere noted in the discussion:

·        The gross general fund position for directorates was £19.6m overspent, however corporate items were now underspending by £7m, and following the application of contingencies, the net general fund position was now reported to be £300,000. This was a favourable position in comparison to Quarter 2.

·        There had been some large changes in directorate forecasts over the previous quarter. Children’s Services finances had improved by £800,000 due to a reduction in placement costs. The Environment directorate continued to face challenges on parking income; in particular it was noted that the directorate was forecasting to receive £1m of income from parking suspensions associated with the roll-out of the fibre optic network, however this was now unlikely to be received by the end of the financial year. The demand for Temporary Accommodation had also increased, which had an adverse impact on the budget of the Homes and Neighbourhoods directorate.

·        Officers summarised other risks to the council’s financial position; school balances were forecasting a significant deficit by 2025/26, it was expected that future local government finance settlements would be flat  in cash terms or even reduce, and here was uncertainty in energy markets that would increase prices.

·        The Committee understood the demand pressures faced by Adult Social Care and Children’s Services and it was noted that some members of the committee had met with officers to discuss the management actions being taken to address the issue. However, it was asked what actions were being taken by the Environment Department to address the underachievement in parking income. For example, a member suggested that the Environment department could pause spending on discretionary projects in order to improve the financial position.

·        Officers advised that they are working closely with the Environment directorate. Parking income was an area subject to a lot of risk, however work had been undertaken to ensure that the following year’s parking estimates were more robust.

·        The Committee discussed the financial rules that applied to the ringfenced parking account and how these funds can only be used for highway and environmental improvements. Members expressed concern that the council would be unable deliver improvements without robust parking income.

·        Officers advised that they could circulate a paper to members summarising the latest position on the parking account and trends over time.

·        A member expressed concern about parking income forecasts, citing the delay to the roll-out of fibre optic broadband, suggesting that this could have been anticipated. In response, officers summarised how the delivery of this work had been monitored and changed over time.

·        Officers advised that, at year end, the council was expected to reach a financial position near to break even, which was a positive result given the scale of the financial challenge.

·        Following a question of the financial impact of temporary accommodation, it was advised that many homeless households across London were living in hotels at significant expense. While Islington did make use of hotel accommodation, it also had its own temporary housing provision, which meant that it was not spending as much as some other local authorities.

·        The Committee praised the buyback of former right-to-buy properties as a way of tackling the housing crisis and suggested that the council could lobby the Mayor of London to make more funds available for these schemes.

·        A member noted the challenging financial position and thanked officers for their work in managing the budget in these difficult circumstances.

·        The Committee noted that the delivery of some savings was off track and queried if these were delayed or unachievable. In response, officers commented on the complications of delivering some savings, but advised that it remained the plan to achieve savings that are factored into the budget process.

RESOLVED:

That the quarterly budget monitoring report be noted.