The Chair agreed that this item along with items 7 (Budget Projections 2012/15) and item 14 (Financial Out-Turn 2010/11) be considered concurrently (see minutes 9 and 10 post).

The Director of Finance provided a summary of the position of the revenue accounts and General Fund balances as at 31 May 2011. He also circulated an update as at 30 June 2011, which highlighted a number of pressure areas that had been highlighted by Departments –

·  Pressures of £6m in Adult Social Services

He reported that potential slippage in implementing the 2011/2012 savings accounted for £3m and a further £3m related to underlying pressures from increased demand for older people and people with learning disabilities. The Interim Director was looking at options to reduce any potential overspend.

·  Pressures of £5.6m in Children & Young People

He reported that increasing demand within Child Care amounted to £2.8m, with foster care accounting for £1.7m of that amount. The Integrated Transport Unit had potentially a £1.1m overspend through increased commitments and the non-achievement of savings and £1.2m related to other costs including delayed EVR savings, court fees, social care car allowances and additional pension liabilities. The Interim Director was also looking at options to reduce any potential overspend.

·  In respect of the other departments, the Director reported that the implementation of the policy options and delivery of the savings were all progressing. The achievement of income targets remained the key concern with this being highlighted within Corporate Services for the transferred services of building and planning control and Technical Services in respect of car parking and cultural services activities

The Director reported that the projected level of balances at 1 April 2011 when setting the 2011/2012 Budget was £14.1m. Of that, £7.2m was allocated to fund ‘one-off’ options and the cost of the EVR/VS Scheme in 2011/2012 leaving a projected balance at 31 March 2012 of £6.9m. The release of Connexions reserve monies allowed £4.4m (the EVR/VS scheme element) to be funded in 2010/2011. The outturn for 2010/2011 resulted in a net increase in balances of £1m and he commented that the Cabinet had agreed to fund Fernleigh House and agreed additional funding for the integrated transport unit. This resulted in current predicted balances of £11.5m, which would be reduced by any further budgetary allocations or overspends within the 2011/2012 financial year.

Responding to comments from Members, the Director stated that all chief officers were aware that they had to maintain their expenditure in line with their departmental budget. If a substantial variation was arising they would have to report this to Cabinet and it would be for Cabinet to decide where potential savings could be made to balance the projected overspend. Individual chief officers report to their relevant Overview and Scrutiny Committees on potential budget variations. He acknowledged the difficulties faced by both the Adult Social Services and Children and Young People’s departments which had to manage unpredictable demand driven care services.

The Chair suggested the need for a better early warning system which would highlight were budgetary variations were occurring. A Member suggested that the relevant chief officers be invited to this Committee to explain how they were addressing any budgetary issues.

Resolved – That the Financial Monitoring Statement be noted and the Committee looks forward to each monthly statement and hopes to see an improvement.