Purpose

This report provides the
Council’s financial performance as at Period 6 (September
2025) for the General Fund, Housing Revenue Account (HRA) and the
Capital Programme.  It also requests the
Executive Mayor and Cabinet to approve an inter-directorate budget
virement from Resources to Housing General Fund to align with where
the cost of temporary accommodation management fees (non-claimable
from Housing Benefits) now impacts. 
This follows these costs now being recorded in the NEC housing
system (no longer counted as part of the rent cost for housing
benefits).

Content

For the reasons set out in the
report, the Executive Mayor and Cabinet are
AGREED:
 
2.1 to note the General Fund
revenue budget outturn is forecast at Period 6 to underspend at
financial year end by £23.8m, contributing to the target as
required by the Stabilisation Plan. This would reduce the necessary
level of capitalisation directions from £136m to
£112.2m.
 
2.2 to approve the
inter-directorate virement from Resources to Housing (General Fund)
of £3.022m budget to align with where the cost of temporary
accommodation management fees (non-claimable from Housing Benefit
subsidy) now impacts. This aligns with these costs now being
recorded in the NEC housing IT system (no longer counted as part of
the rent cost for housing benefit subsidy), as set out from
paragraph 5.82. This is not a change to the purpose of the budget
agreed by Full Council.
 
2.3 to note that service
directorates have been asked to reduce their net expenditure below
their budgets so that the annual budget can be balanced with
reduced use of capitalisation directions, including achievement of
the £27.3m Stabilisation Plan target as set out from
paragraph 5.19. It should not be underestimated what a challenge
this will be against the background of increased demand pressures
which are continuing to build across local government as well as
increased market prices.
 
2.4 to note the unfunded local
government cost pressures that exist nationally, regionally and
locally relating to increases in demand and market prices which
need to be addressed by Government changes to policy and/or funding
levels.
 
2.5 to note that the
presentation of full Financial Performance Reports to Cabinet is
being moved to a quarterly basis, with a shortened Financial
Performance Summary being published for other months from Period 2
to Period 10 on the Council’s Corporate Performance and
Finance Reporting webpage. This change is to ensure regular
reporting for transparency whilst also prioritising service and
finance officer time on value-added activities including
transformation, as set out from paragraph 5.10.
 
2.6 to note the progress in
Medium Term Financial Strategy (MTFS) savings achievement of
£21.7m (86.2%) against the total savings target of
£25.1m as set out from paragraph 5.125.
 
2.7 to note the Housing Revenue
Account (HRA) revenue budget forecast outturn is a breakeven
position.
 
2.8 to note the General Fund
capital programme 2025-26 forecast underspend of £44.8m
(16.2%) against the revised budget of £275.9m. The expected
decrease in capitalisation direction usage owing to the
Stabilisation Plan accounts for £27.3m of the forecast
underspend. £24.4m of this is evidenced to date at Period 6
with directorates continuing to reduce their net expenditure
wherever possible.
 
2.9 to note the HRA capital
programme 2025-26 forecast underspend of £26.8m (22.2%)
against the capital budget of £120.5m.
 
2.10 to note the
Council’s historic borrowing and subsequent debt burden and
national, regional and local service pressures continue to be
critical to the non-sustainability of the Council’s revenue
budget as set out from paragraph 5.146.
 
2.11 to note that the Council
continues to operate Spend Control Panels, and tightened the
criteria from July 2024, to ensure that stringent financial control
and assurance oversight are maintained.
 
2.12 to note that current
forecasts are based on the best available information at the time
and will be subject to review and change during the financial
year.