The Director of Finance introduced the report which set out the financial monitoring information for the Council as at Quarter 3 (31 December) of 2022/23 and provided an overview of budget performance, including progress on the delivery of the 2022/23 saving programme and a summary of reserves and balances, to enable the Committee to take ownership of the budgets and provide robust challenge and scrutiny to Officers on the performance of those budgets.

It was reported that at the end of Quarter 3, there was a forecast adverse position of £12.36m on the Council’s net revenue budget, of £330.58m. The position had deteriorated by £1.36m since Quarter 2 due to the continued trend of increasing numbers of children in care, particularly young people placed in high-cost residential settings and the loss of Housing Benefit Subsidy.

A discussion ensued on the number of invoices paid without a purchase order having been raised and the Monitoring Officer’s view was sought on the legality of a motion for no payments to be made without a purchase order. Advice was given that the impact could not be substantiated and that statutory services often required invoices to be paid without a purchase order.

It was moved by Councillor Tom Anderson, seconded by Councillor Lesley Rennie, that ‘From 1 June 2023, the Council does not pay any invoices without a Purchase Order, with a 6 month exemption for statutory services.’

Further to the motion, the Section 151 Officer explained that the proposed June 2023 deadline would be difficult to achieve without presenting a risk to the operation of the Council and sought the mover of the motion’s view on delaying the deadline for a further six month period, to enable the submission of a report back to Committee on this matter. The mover of the motion indicated that he did not wish to amend the original motion.

Councillor Phil Gilchrist indicated that he wished to move an amendment so that officers report back to the Committee on the delivery of the new ERP system before a decision was taken. The Monitoring Officer advised that this risked negating the motion moved by Councillor Anderson.

The motion as originally moved was then put the vote and the motion was lost (6:9).

It was then moved by Councillor Phil Gilchrist, seconded by Councillor Paul Stuart, that further to the recommendations detailed in the report, the following addition be considered, that ‘in light of the responses from officers, officers report as early as possible to committee on the way that the new ERP system will correct deficiencies and provide further security to reduce the risk to the Council.’

Councillor Tom Anderson indicated that he was supportive of the motion and proposed a friendly amendment to the motion, so that it included an additional sentence to read “and report to Policy and Resources Committee on a regular basis the amount of invoices paid without a purchase order, with a plan of action to come in no later than September 2023.”

Councillor Phil Gilchrist indicated he did not wish to accept the amendment as friendly and that the amendment should be voted on instead.

Councillor Lesley Rennie seconded the amendment. The amendment was then put to the vote and was carried (unanimously).

The substantive motion was then voted on and carried (unanimously). It was therefore –

Resolved – That

(1)  the forecast adverse position of £12.362m presented at Quarter 3, alongside the proposed mitigation at year end to eliminate the shortfall be noted.

(2)  the progress on delivery of the 2022/23 savings programme at Quarter 3 be noted.

(3)  the forecast level of reserves and balances at Quarter 3 be noted.

(4)  in light of the responses from officers, officers report as early as possible to committee on the way that the new ERP system will correct deficiencies and provide further security to reduce the risk to the Council, and report to Policy and Resources Committee on a regular basis the amount of invoices paid without a purchase order, with a plan of action to come in no later than September 2023.