To provide Cabinet with assurance on the robustness of budgetary control and monitoring across the Council, to highlight key financial risks within directorates and identify mitigation to bring the authority within its overall approved budget.

THAT:

(a)          the projected overspend of £3.9m for 2013/14 and the potential impact on reserves and the 2014/15 budget, be noted; and

(b)          the continuing action by Directors to identify further financial savings to mitigate the impact, be supported; and

(c)          Directors and financial resources are focussed on identifying savings for the remainder of 2013/14 and future savings for 2014/15 to 2016/17

The council continues to forecast an overspend for the year, at August approximately £3.9m or 2.5% of its net budget. The key pressure relates to Adults Wellbeing; either savings slipping or not being able to be delivered and pressures from the Department of Health.    The projected overspend in Adult Wellbeing of £4.3m represents 8% of their net budget. Mitigations have been put in place to recover the position and these are currently estimated to be approximately £0.4m, which would improve the reported position.

The council has a limited level of reserves; to such an extent that any overspend in year would need to be recovered in 2014/15, adding to already significant savings forecast at approximately £12m or 8% of its net budget.

Local authorities are not legally permitted to borrow to support revenue overspends and the low level of reserves put this position at risk unless urgent action is taken. Additional action is therefore recommended, to bring forward additional savings proposals from across the council, to minimise the potential overspend.

There are no alternative options that do not radically effect the provision of services.