The report of the Section 151 Officer is attached marked 7.

Contact: James Walton (01743) 255011

11.1The Committee received the report of the Section 151 Officer – copy attached to the signed Minutes – which provided Members with details of the revenue outturn position for Shropshire Council for 2015/16 and provided a summary of the revenue outturn for each service area with a commentary on the main variations and an outline of how the position had changed since Quarter 3; the movements in the Council’s general balance and the Council’s reserves and provisions.

11.2It was noted that the final outturn for 2015/16 showed an overall net revenue expenditure of £213,027m and an underspend of £2.816m, which was a significant improvement from quarter 3, by over £3m.  The Section 151 Officer drew attention to the budget variations by service area set out at paragraph 6.2 and the further analysis at Appendix 1 of the report. 

11.3The Section 151 Officer reported that the General Fund balance had increased from £15m to £18m but that this was still below the risk assessed level of £28m.  The Section 151 Officer informed the Committee that a Scrutiny Working Group had been put together to look at the general fund balances and the earmarked reserves so the process had been challenged and looked at in more detail.

11.4In response to a query, the Section 151 Officer explained the Council’s vacancy management policy whereby every vacant post was being challenged before being recruited to.  The Section 151 Officer confirmed that if the post was considered essential it would of course be appointed to. 

11.5Turning to the Housing Revenue Account (HRA), the outturn for 2015/16 was an underspend of £1,031m taking the closing balance on the HRA Reserve to £5.824m.  This underspend was due, in part, to less being spent on planned repairs, which, in turn, had led to an increase of £2,803m in the Major Repairs Reserve.  The Section 151 Officer agreed to let Members know the total amount of outstanding rent arrears as at the end of March 2016.

11.6In response to a query, the Section 151 Officer explained that the Schools Building Maintenance Insurance Balances were held on behalf of schools, however, it was not clear what would happened to these reserves once a school become an academy.  A query was raised, in relation to the level of balances for Shire Services and it was confirmed that any underspends went into the reserve.  The Section 151 Officer reported that all earmarked reserves were currently being considered by Cabinet.

11.7A brief discussion ensued in relation to the overspend in Adult Social Care.  The Section 151 Officer explained that the Financial Strategy took account of a greater level of growth in Adult Social Care than previously modelled for and whilst there was significant more growth, Adult Social Care did not appear to be quite as high as first thought. 

11.8Further reports were requested for future meetings on school balances in relation to the Academisation of schools, the School Buildings Maintenance reserve and the HRA.

11.9 RESOLVED:

A.      To note that the Outturn for the Revenue Budget for 2015/16 was an underspend of £2.816m, this represents 0.5% of the original gross budget of £594m.

B.      To note that the level of general balance stood at £18.370m, which was above the anticipated level included within the Financial Strategy.

C.      To note that the Outturn for the Housing Revenue Account for 2015/16 was an underspend of £1.031m and the level of the Housing Revenue Account reserve stood at £5.824m (2014/15 £3.076m).

D.      To note the increase in the level of Earmarked Reserves and Provisions (excluding delegated school balances) of £4.175m in 2015/16.

E.      To note that the level of school balances stood at £7.173m (2014/15 £3.957m).