To invite cabinet members to consider performance for the first two months of 2015/16 and the projected budget outturn for the year.

The cabinet member for economy, communities and corporate introduced the report which used to be presented as two separate reports. Performance is RAG-rated (red, amber, green) and although there were some high risks, there were controls in place.  Feedback on format of reports and the information presented was welcomed in order to make them as useful as possible.

The director of resources presented the financial highlights from the report. The overall projection of overspend was not a concern and there was confidence that this would be addressed through the year. The contingency fund and reserves could cover the overspend if things remained unchanged. There were concerns regarding safeguarding spending and plans not being achieved. Spending was at the same rate as last year alongside significant reductions in budget. However the HIPPS programme was proving successful. It had been anticipated that external fostering costs would reduce during the year but they had not reduced in line with the plan, hence the variance. Plans were in place to review all cases to ensure children did not stay in external fostering longer than necessary.  It was not expected that safeguarding would come within budget this financial year. Plans were in place to reduce agency staff, but there remained a need to staff the service. The ‘grow our own’ strategy through the academy was working but was a long term plan. Consideration was to be given to how to address budget plans for 2016/17 as there were plans to reduce the budget further.

The budget for adults and wellbeing and economy, communities and corporate directorates were spending within budget.

Budgetary control across the board was considered to be good.

In relation to interest rates, the director of resources explained that they had been low for a number of years but an increase at the turn of year was anticipated by the Bank of England. The impact on the council would be minimal as the majority of borrowing had been fixed at low interest rates.

In answer to a question from the group leader of the Herefordshire Independents regarding the monetary policy committee, it was clarified that this was made up of economists.

The director of adults and wellbeing answered his further question regarding the risk referred to in appendix D and non-compliance of the Care Act. The council remained in dispute with the clinical commissioning group regarding the amount of budget available to support the existing commitments and therefore the contracts had not transferred to the local authority. Ongoing dialogue was taking place and the actual service provision was continuing. Phase 2 of the Care Act was due to be implemented from April 2016; however the government had just announced that phase 2 would now be delayed until 2020. This risk would be amended in light of this announcement. In terms of phase 1, the information, advice and signposting function was now fully commissioned though would not be fully operational until later this year and so remained a risk to the council though mitigation  ...  view the full minutes text for item 90