Agenda item

ORDERED that Executive:

 

1. Approve the proposed amendment to Appendix nine of the report referring to Member’s Small Schemes so that £150,000 be allocated in 2025/26 and £120,000 be allocated in 2026/27.
2. Approve the inclusion of additional expenditure budgets to the Capital Programme totalling £0.322m for 2024/25 which were externally funded and detailed in Appendix six of the report. Subject to approval this would increase the approved 2024/25 Capital Programme budget to £107.463m.
3. Approve the proposed virements over £250,000 between schemes in the 2024/25 Capital Programme approved by Council in March 2024 which were funded from within existing Council resources which were detailed in Appendix six of the report.

 

AGREED that Executive

 

1.    Note the Council’s year-end financial outturn for the financial year 2024/25, and the improved financial position which included the following:

·         increased levels of usable unrestricted revenue reserves, with £21.654m available at 31 March 2025.

·         an underspend of £2.257m on the revenue budget.

·         a requirement to use only £2.443m of the £13.400m Exceptional Financial Support (EFS) approved in-principle by the Ministry of Housing, Communities & Local Government (MHCLG).

·         no requirement to borrow for the EFS, as capital receipts already held will be used.

 

The Executive Member for Finance submitted a report for Executive consideration. The purpose of the report allowed Executive to discharge its responsibilities to manage and control the revenue budget, capital programme and overall balance sheet position of the Council.

 

The Council’s Scheme of Delegation gave the Executive collective responsibility for corporate strategic performance and financial management, monitoring and control. Standing Orders and Financial Procedures required Executive’s approval for major virements between revenue budgets, and in-year changes to the Council’s Capital Programme within approved Council resources within the approved policy framework.

 

The report enabled Executive to discharge its financial management responsibilities by setting out the Council’s position for the financial year ended 31 March 2025.

 

Financial Procedure Rule 18.38.3 of the Council’s Constitution required Executive’s approval of revenue and capital programme budget virements over £250,000.

 

Executive had considered quarterly reports forecasting the 2024/25 Revenue and Capital Programme outturn during the course of the 2024/25 financial year and the report presented the final year-end outturn for 2024/25.

 

The previous Director of Finance (S151 Officer) issued her Section 25 Report to Members in the 2024/25 Revenue Budget, Medium Term Financial Plan, and Council Tax setting report approved by Council on 8 March 2024. That report set out the basis upon which the revenue budget was considered to be robust and the basis upon which reserves were considered adequate, being dependent upon the approval of Exceptional Financial Support (EFS) by the Ministry of Housing, Communities and Local Government (MHCLG) (formerly DLUHC) as summarised in the table at paragraph 4.5 of the report.

 

Based on the year-end revenue budget outturn position detailed below, the only element of EFS required to be used in 2024/25 was £2.443m of the £4.700m approved in principle by MHCLG. This was approved to set a balanced budget for 2024/25, which was still subject to formal approval by MHCLG. As the amount of EFS required was now much smaller, capital receipts already held by the Council would be utilised for the EFS rather than borrowing, which was originally advised to Members. This would mean the Council would not incur any capital borrowing costs.

 

The use of capital receipts for EFS would not affect the planned use of capital receipts generated from asset sales for the Transformation required by the Council in future years.

 

The 2024/25 final year-end revenue budget outturn as at 31 March 2025 (Quarter Four) was an underspend of (£2.257m) (1.6%) against the approved budget of £143.190m. This represented an improvement of £5.999m from that forecasted at Quarter One and an improvement of £2.251m from that forecasted at Quarter Three. This was achieved by the budgetary control measures which existed during 2024/25 and which would be continued during 2025/26 which were detailed in paragraph 4.52 of the report. The agreed actions from the budget challenge sessions held during 2024/25 were detailed in the quarterly budget monitoring reports during 2024/25.

 

The analysis of the financial outturn by Directorate was set out in Table one of the report. This was also illustrated in Chart one which showed simply that 80% of the Council’s expenditure in 2024/25 was spent on Social Care (Children’s and Adult).

The Executive Member for Finance proposed an amendment to the report, specifically with regards to the Member’s Small Schemes cited in the revised Capital Programme at Appendix nine of the report. The proposed amendment was for the Small Scheme Allocation to show £150,000 for 2025/26 and £120,000 for 2026/27 rather than £60,000 for 2025/26 and £210,000 for 2026/27 as was cited in the Appendix.

 

The Executive Member commented that a significant amount of work had been undertaken to improve the Council’s financial position but that some areas still faced significant pressures, such as Children’s Services. The Council needed to make delivering in-budget the norm and not the exception.

 

The Executive Member expressed her thanks to all staff involved in the creation of the report and the preparation of the budget. Thanks were also expressed to all Councillors that had provided input to the budget process.

 

The Mayor added his thanks to everyone involved in the budget setting process, especially the Executive Member for Finance. The Mayor stated there was a sense of rigour in the budget setting process and as such the Council was able to invest in services for the first time in several years. Middlesbrough continued to experience challenges, and it was important the town continued to lobby government to ensure it received the right level of support.

 

OPTIONS

 

The alternative was to not approve changes to the Council’s capital programme and to not report the Council’s financial year-end financial outturn for the financial year 2024/25. This would not enable the Executive to discharge their responsibilities to manage and control the revenue budget, capital programme and overall balance sheet position of the Council.

 

ORDERED that Executive:

 

1.    Approve the proposed amendment to Appendix nine of the report referring to Member’s Small Schemes so that £150,000 be allocated in 2025/26 and £120,000 be allocated in 2026/27.

2.    Approve the inclusion of additional expenditure budgets to the Capital Programme totalling £0.322m for 2024/25 which were externally funded and detailed in Appendix six of the report. Subject to approval this would increase the approved 2024/25 Capital Programme budget to £107.463m.

3.    Approve the proposed virements over £250,000 between schemes in the 2024/25 Capital Programme approved by Council in March 2024 which were funded from within existing Council resources which were detailed in Appendix six of the report.

 

AGREED that Executive:

 

Note the Council’s year-end financial outturn for the financial year 2024/25, and the improved financial position which included the following:

·         increased levels of usable unrestricted revenue reserves, with £21.654m available at 31 March 2025.

·         an underspend of £2.257m on the revenue budget.

·         a requirement to use only £2.443m of the £13.400m Exceptional Financial Support (EFS) approved in-principle by the Ministry of Housing, Communities & Local Government (MHCLG).

·         no requirement to borrow for the EFS, as capital receipts already held will be used.

 

REASONS

 

To enable the effective management of finances, in line with the Council’s Local Code of Corporate Governance, the Scheme of Delegation and financial regulations.