Highland Council Budget Leader warns of even tougher decisions to come

24th May 2018

Speaking at Highland Council's Corporate Resources Committee today (24 May 2018), Budget Leader Cllr Alister Mackinnon said that the Council's reported overspend showed the extent to which successive budget reductions and council tax freezes meant the authority had no wriggle room to manage significant pressures in demand-led services like supporting children with additional support needs. He said:"We have done everything we can to protect front line services and particularly services to children and young people. That is why our focus has been on finding ways to increase income, such as car parking, or ways to reduce expenditure in areas where we have no statutory responsibility.

"I know not everyone supports these measures, but today's report should leave no one in any doubt that we have to deliver these commitments and also look for additional ways in which we can meet current and future budget challenges.

"Personally, I see no prospect of the budget situation improving and I fear there are even tougher decisions ahead of us and we all have to acknowledge that."

The Council's Deputy Chief Executive and Director of Corporate Resources, Derek Yule said that "...it was very rare for the Council to return an overspend." He said that the Council's elected members should see this as a "wake up call and recognise the need to make tough decisions about where to cut services... and to stick by those decisions."

The financial report from the council meeting can be seen at -

https://www.highland.gov.uk/meetings/meeting/3980/corporate_resources_committee/attachment/73675

Summary

1.1

This report provides a summary of the near final revenue budget spend for financial year 2017/18. The position is described ‘near final’ pending the completion of the year-end accounts and audit process.

1.2

Net spend on services for the year totalled £550.619m against a budget of £549.093m. This represents a net overspend on services of £1.526m, a significant improvement from the forecast position reported at quarter 3.

1.3

Due to decisions taken in the year and other legislative requirements the Council transferred £5.022m into its earmarked balances and other specific reserves during the year. These transfers were £0.354m above the budgeted level.

1.4

On the funding side the Council received government funding and Council Tax £0.837m in excess of budget, with income of £552.839m against a budget of £552.002m.

1.5

Overall the difference between total expenditure of £555.641m and total income of £552.839m was £2.802m. That sum reflects the amount of excess expenditure which requires to be funded from the Council’s non-earmarked general fund reserve. Of this £1.759m was planned with the balance of £1.043m being the unplanned deficit recorded at year end.

1.6

Over the course of the year the Council’s general fund non-earmarked balance has reduced from £11.363m to £8.561m. The year-end balance represents 1.56% of the annual revenue budget.

Debate on webcast at

https://highland.public-i.tv/core/portal/webcast_interactive/349624