To receive and consider the report of the Head of Finance.
Minutes:
· Report of the Head of Finance – Price Inflation Variation and Volatility Pressures.
Issues Discussed:
· Section 3 of the report considers some of the more specific indices and cost rises above the rate of general inflation.
· The report sets out the understanding of the impact on the Council. Officers from across the Council have been drawn together to work collectively to monitor, share information, consider and address the issues as they arise.
· Where providers are approaching the Council there is a sound process in place to assess the impact on an open book basis. Any request needs to be substantiated and evidenced in terms of impact on the company’s financial position.
· The biggest impact is likely to be next year and the impact on next year’s budget plans is being assessed.
· A robust virement process is in place and the financial position is updated on a quarterly basis. Specific reserves were established at the end of last year and some of those reserves are being drawn down. The overall position for the Council is projecting a deficit in addition to the use of specific reserves of around £1m based on the position in the first quarter.
· Some of the pay awards are starting to be approved which will have a substantial impact on the budget both in the current year and for the future.
· Officers and the Cabinet are reviewing the MTFS (Medium Term Financial Strategy) and that will be presented to the Council in September based on the revised assumptions.
The Cabinet Member for Finance and Corporate Transformation suggested that the paper could be shared with the wider membership of the Council He also asked if the Council has a team established to monitor energy use in buildings and limit energy use in buildings.
The Head of Finance indicated that energy use corporately is monitored so that work could help inform the overall position. Information has also been received from the national procurement framework on the impact of energy costs for these buildings.
· Questions:
Question |
Response |
In Section 5 regarding current contracted positions. Is there any more information where contracts could be split into categories which could be subject to different rates of increase so that we could judge the potential financial impact. |
There is a contract register in the Procurement Team. It is not known if the contracts are split into the different categories listed in the report. The Head of Finance agreed to find out what information was available in terms of categorisation of contracts and could be shared with the Committee. |
Audit Wales had identified a significant medium term budget gap. The Head of Finance is producing a revised MTFS. We only have budgets in any organisation to achieve priority outcomes and outputs. It would be useful to see on a single page the cascading of the aspiration and vision how that translates into a corporate plan and the budgets associated with this, to connect risks with outcomes and priorities. |
The corporate plan is being developed by the new Cabinet to reflect their objectives and priorities. It would be difficult to capture all of the information suggested on a single page.
Individual service integrated business plans are in place which captures everything which impacts on that service and links into the financial plans for the service. Those plans then come together in the corporate plan, and the corporate budget development process and the risk register to make sure all of those plans are considered collectively and that the finances are in place to deliver on those objectives and plans. |
Outcomes:
· Report Noted.
· Contracts - The Head of Finance agreed to find out what information was available in terms of categorisation of contracts and could be shared with the Committee.
· Budget Seminars – that all of the Lay Members be invited to the budget seminars for Members.
Supporting documents: