Issue - meetings

To consider and decide on the recommendations as set out in the associated report.

RESOLVED –

1.    That at Quarter 3 net expenditure on services year to date was £10,361,000, £741,000 less than budget be noted.

2.    That by year end the Council anticipated net expenditure of £15,278,000 on services, a forecast of £144,000 under budget, an improvement of £656,000 on Quarter 2 be noted.

3. That by year end the Council anticipated receiving an increase in funding of £1,150,000 due to additional investment interest. An improvement of £400,000 since Quarter 2.  Overall, this means an underspend compared to budget of £1,294,000, and improvement of £1,056,000 since Quarter 2.  This will fund the budget deficit of £944,000 that was to be met from reserves, with the additional £350,000 being available to be transferred to reserves, be noted.

4. That a new charge for bay suspensions be implemented from 1 April 2023 be approved.

REASON FOR DECISION: To show the actual expenditure on services compared to the revised budget for the period ending 31 December 2022, and the forecast outturn position, highlighting significant variances from the revised annual budget

Councillor Christopher Hall, Cabinet Member for Finance and Performance introduced Jane Fineman, Head of Finance, Procurement and Parking who presented the report set out in the agenda.

Discussion and questions from Members included the following:

-       All usable reserves had been allocated and currently there was an over allocation of £1m. 

-       All expenditure, whether revenue or capital should be funded from reserves, but there was also the ability to fund from a minimum revenue requirement i.e. internal borrowing. 

-       Internal borrowing had to be repaid over a period of years, over the life of the asset.  This impacted on the revenue budget going forward.

-       £5.9m of internal borrowing had been forecast, if this was included, all reserves had been spent.

-       Whilst the revenue budget was welcomed news, this was a double edged sword as budget savings due to staff vacancies was not sustainable. 

-       Staff vacancies needed to be filled so that services did not suffer.

-       Parking revenue was encouraging and did not appear to be having an effect on visitor numbers to Tunbridge Wells.

-       There was significant expenditure still to come, so although this was positive, there were still challenges ahead.

-       Appendix H highlighted a number of uplifts and officers should be commended for providing services despite the current resourcing problems.

-       It was made clear that TWBC only received 10p out of every £1 of Council Tax collected.  Similarly, it only received 4.7p out of every £1 collected for Business Rates. 

-       Staffing issues were a much wider problem affecting the whole of Local Government.

-       Unemployment levels in Tunbridge Wells had gone down, making the problem in TWBC worse. 

RESOLVED –

1.    That at Quarter 3 net expenditure on services year to date was £10,361,000, £741,000 less than budget be noted.

2.    That by year end the Council anticipated net expenditure of £15,278,000 on services, a forecast of £144,000 under budget, an improvement of £656,000 on Quarter 2 be noted.

3. That by year end the Council anticipated receiving an increase in funding of £1,150,000 due to additional investment interest. An improvement of £400,000 since Quarter 2.  Overall, this means an underspend compared to budget of £1,294,000, and improvement of £1,056,000 since Quarter 2.  This will fund the budget deficit of £944,000 that was to be met from reserves, with the additional £350,000 being available to be transferred to reserves, be noted.

4. That a new charge for bay suspensions be implemented from 1 April 2023 be approved.

REASON FOR DECISION: To show the actual expenditure on services compared to the revised budget for the period ending 31 December 2022, and the forecast outturn position, highlighting significant variances from the revised annual budget

To consider and provide a recommendation to Cabinet on the proposals set out in the attached report.

Jane Fineman, Head of Finance, Procurement and Parking introduced the report set out in the agenda.

Discussion and questions from Members included the following:

-       The Council budgeted for a £944k deficit for 2022/23.  The Council were now budgeting for a £943k deficit for 2023/24. 

-       The Council had taken advantage of the increases in interest rates.  The Council had been fortunate that it had received quite a lot of Government Grant money that it had been able to use to generate income from the higher interest rates. 

-       Staff vacancies had been good in terms of the Council’s finances.  But for the staff working at the Council, it had been difficult as they have had to try and plug the gaps by undertaking the additional work this created.  This could not continue.  

-       Without the increase in interest rates, and the savings made due to staff shortages, offset by the energy increases, the Council would still have a budget deficit of £943k for 2022/23.

-       Determining where the Council would be in respect of the number of staff vacancies at the beginning of the year and again at the end of the year was difficult to predict as each vacancy was assessed individually depending on the needs of the relevant department.

-       Each post was looked at independently and a judgement was then made as to whether it would be filled by the end of the year. 

-       The 34 vacant posts was therefore just a snapshot in time. The Council had an attrition rate, but also people were joining the Council all the time. 

-       At the beginning of each year, the Council budgeted for a full complement of staff.  It also budgeted for a vacancy rate (a vacancy factor). 

-       For 2022/23 there was a forecast vacancy factor of £260k.  The 2023/24 budget included a vacancy factor of £340k.

-       As part of the budget setting process, a new post had been included to recruit an HR Change Manager.  The role would include refreshing HR policies post pandemic and addressing the loss of staff.  Unfortunately, the post remained unfilled.  The market was extremely competitive with salaries at a level the Council could not compete with. 

-       The Council continued to explore all avenues in trying to attract staff to the Council.   However, at present, the Council was not seen as an attractive place the work. 

-       The Council was committed to try and change this mindset, but the task continued to be very difficult.

-       TWBC were not alone in struggling with staff turnover.  The Council benchmarked itself against other Councils and unfortunately the story was similar.  Other Councils in West Kent were also experiencing 20%- 25% staff turnover.

-       The Council had a programme of training but unfortunately this often meant that once trained, officers left for jobs in the private sector offering higher salaries.

-       The public sector had a rigid pay structure.  Officers could see the maximum they could achieve within their particular grade.  ...  view the full minutes text for item 88