The Scrutiny & Overview Committee met on 12 February 2024 to review the council's financial performance and scrutinise the proposed budget for 2024-25. Key discussions included the Period 8 financial performance report, which indicated a projected underspend for the year, and the Mayor's proposed budget for 2024-25, which aims for a balanced budget despite significant financial challenges. The committee also discussed scrutiny recommendations and made appointments to sub-committees.

2023-24 Period 8 Financial Performance Monitoring Report

The committee reviewed the Period 8 Financial Performance Monitoring report, which covers the council's budget position up to November 2023. It was noted that the council was predicting an overall underspend for the financial year, an improvement from previous forecasts. While Children's Services still showed a projected overspend, this was expected to be balanced by underspends in other areas. The committee welcomed the reassurance that services were being delivered as required, despite the projected underspend.

A transfer of £2.1 million from the Adult Social Care budget to the Housing budget was discussed. This was explained as a one-off measure to support emergency accommodation pressures, funded by additional grant income received by Adult Social Care. The committee also inquired about the modelling for worst-case scenarios regarding emergency accommodation costs, noting that while challenging due to fluctuating demand, potential overspends could be managed through existing underspends and the Corporate Contingency Fund.

Budget Scrutiny 2024-25

The committee scrutinised the Mayor's proposed budget for 2024-25, noting that the council was in a position to propose a balanced budget, a feat not achieved by all local authorities. The process for setting this year's budget was described as smoother due to improvements made in previous years. The budget gap had been closed through a combination of factors, including a higher-than-anticipated allocation from the Local Government Settlement and a lower-than-expected contribution requirement for Freedom Passes.

A proposed £1.1 million saving related to the realignment of the staffing budget for Children, Young People & Education had been removed due to concerns about its deliverability. A remaining £5 million unidentified gap led to the decision to remove the Economic Pressures budget, increasing the overall risk but with potential mitigation from existing contingency funds.

The committee sought clarification on the £3.8 million Adult Social Care Grant, which is split to support hospital discharge and manage market pressures. Concerns were raised about the Council's debt level, with projections indicating a potential upward trend after 2027 due to ongoing capitalisation needs. Negotiations with the Government regarding debt write-off or equivalent support are ongoing.

The committee discussed the removal of the £5 million Economic Pressures Fund, acknowledging the increased risk this presented, particularly in a volatile economic environment with rising service demand. However, they recognised this decision was based on improved budget modelling. The scale and pace of transformation were noted as areas needing improvement, with a new Transformation Strategy and Director being introduced to drive ambition.

The committee also discussed the proposed £500,000 Hardship Fund, a reduction from the previous year's £2 million, but welcomed its reallocation to the Council Tax Support Scheme due to higher demand. The potential discontinuation of the Household Support Fund was noted, with ongoing lobbying for its continuation.

Scrutiny Recommendations

The committee approved recommendations made by its sub-committees for submission to the Executive Mayor and noted the Mayor's responses to previous recommendations.

Scrutiny Sub-Committee Appointments

Councillor Tamar Barrett was appointed to the Children & Young People Sub-Committee, filling a vacancy.

Scrutiny Work Programme 2023-24

The committee noted the most recent version of the Scrutiny Work Programme.

The meeting concluded with the committee agreeing to schedule a review of the forthcoming Digital Strategy and asking the Streets & Environment Sub-Committee to review the use of Community Infrastructure Levy funding within the capital programme. The committee also recommended that further work be undertaken to raise awareness of the Hardship Scheme, that an updated version of the Financial Risks appendix be presented to Council, and that additional information be included in the final budget report to Council explaining the legacy Capitalisation Direction.