Lead Member – Councillor Gwilym Butler, Portfolio Holder for Finance, Corporate Resources and Communities

Lead Officer - Ben Jay

RESOLVED:

That Cabinet Members:

A.    Direct the Chief Executive to lead all Officers in urgently taking the necessary actions to improve the Quarter 1 forecast of a projected spend over budget of £38.5m (30th June 2024), by year end, predominantly focussing on remaining savings or mitigating actions to be delivered in 2024/25.

B.    Discussed the impact of the projected expenditure forecast on the General Fund Balance and noted the risk of further service pressures (savings required) in next year if financial performance in the current year is not improved.

The Portfolio Holder for Finance, Corporate Resources and Communities presented the report which provided a detailed review of the Council’s financial position as at the 30 June 2024, which had been discussed at length at the Transformation and Improvement Overview and Scrutiny Committee earlier in the week.

Members were advised that the senior officer team had been instructed to take measures to ensure the council lives within its means and brings in a sustainable budget for the long term. A collaborative budget with the opposition has been proposed to work together for the benefit of Shropshire residents, staff, and the council's future.

It was acknowledged that the council has an expenditure of over £700 million a year and is facing a projected overspend against reserves.

Concerns were raised regarding the overspend in various departments, with all 10 portfolio holders exceeding their budgets, some by millions of pounds. In response, it was emphasised that by the difference between overspending and not achieving savings, and the need for strict financial control.

In response to a question regarding what could trigger the ‘adverse’ financial situation and any unknown pressures which could impact the budget, it was hoped that there would be a mild winter with no rain to avoid additional pressures. The impacts of winter fuel payments, the possibility of taking away bus passes, the single person discount on council tax, and the rising energy cap on the people in Shropshire were highlighted.

Members were advised that the council will bring forward contingency plans to ensure it stays within budget. The importance of unity and working together was emphasized to ensure the council's sustainability.

Members of the opposition were invited to work together with the administration for the benefit of residents, staff and the council. In response, group leaders expressed concerns about transparency and access to information, however would consult with their members.

RESOLVED:

That Cabinet Members:

A.    Direct the Chief Executive to lead all Officers in urgently taking the necessary actions to improve the Quarter 1 forecast of a projected spend over budget of £38.5m (30th June 2024), by year end, predominantly focussing on remaining savings or mitigating actions to be delivered in 2024/25.

B.    Discussed the impact of the projected expenditure forecast on the General Fund Balance and noted the risk of further service pressures (savings required) in next year if financial performance in the current year is not improved.

To scrutinise financial performance at Quarter 1 and identify issues that may require further investigation by an overview and scrutiny committee, report to follow