.ENDA ITEM No. NORTH LANARKSHIRE COUNCILREPORT

To: ENVIRONMENTAL SERVICES Subject: REVENUE MONITORINGCOMMITTEE REPORT

01 .04.14 − 20.06.14(PERIOD 3)

From: EXECUTIVE DIRECTOR OF REGENERATION ANDREGENERATION AND ENVIRONMENTAL ENVIRONMENTAL SERVICESSERVICES

Date: 3 JULY 2014 Ref: PJ/RC/JM/P3

1. Purpose of Report1.1. This report provides a summary of Regeneration and Environmental Services financial

performance for the period 1 April 2014 to 20 June 2014 (period 3). The report forecaststhe outturn as at 31 March 2015, with major outturn variances highlighted and explainedas per the Council's approved Financial Regulations.

1.2. A summary of the financial performance of service areas falling within the remit of ThePlanning and Transportation Committee, and The Regeneration and InfrastructureSub−Committee

is also provided within the Appendices for information.

2. Summary of Financial Position2.1. The Council approved its General Fund revenue budget on 13 February 2014, of which

£107.23m is the approved net revenue budget for Regeneration and EnvironmentalServices. In addition, a net budget surplus for the Trading Account of £0.09m wasapproved, giving a total net budget for the Service of £107.14m.

2.2. The Service is currently projecting to be in line with budget for both the Non Trading andTrading Account Services. Details of significant budget variations within this projectionare outlined in paragraph 3 below, and Appendix 1 and 2 of this report, per therequirements of the Council's approved Financial Regulations.

2.3. The Service's 2014−15 budget incorporates £4.968m of savings in line with the Council'sapproved three−year savings package. The Service is presently projecting £4.740m(95.43%) of approved savings are achievable by the financial year−end. Furtherinformation regarding savings is noted in paragraph 4 below.

2.4. Appendices 5 and 6 detail the financial position of service areas falling within the remitof the Planning and Transportation Committee, and Appendices 7 and 8 fall within theremit of the Regeneration and Infrastructure Sub−Committee for information. Appendix 9and 10 reflect the remaining parts of the Service that are within the remit ofEnvironmental Services Committee.

2.5. Elements of expenditure within Regeneration on the Youth Investment Scheme (YIP),and Waste Management on Auchinlea, are being met from earmarked reserves. Thisexpenditure is not contained within the figures quoted throughout this report.

3. Analysis of Significant Variations3.1. Environment and Estates are projecting to be in line with budget however there are a

number of compensating variances as follows:

3.1.1.Employee costs are projected to be overspent by £212,000. This is mainly due tobudgeted turnover savings not being projected to be fully achieved £102,000,increased Fleet Operations overtime £86,000 due to service demands andincreased staff costs in relation to the Commonwealth Games £129,000. This ispartially offset by vacancy savings in Land Management £58,000. These

overspends will continue to be monitored throughout the year and future virementswill be requested where appropriate.

3.1.2.Waste Management are projecting a saving in gates fees £31,000 for wastedisposal contracts which are currently being re−negotiated.

3.1.3.Fleet Operations are forecasting an over−recovery for a Bus Operator Grant of£123,000 and additional work income £33,000.

3.1 .4.Land Management are projecting an under−recovery of grounds maintenance andstreet cleaning income of £102,000 from others Services and external clients basedon service demand levels. There are also increased costs forecast for utlilities£36,000 and tipping fees £48,000 based on the previous year. This is offset byforecast reduced supplies and services £51,000 and also increased cemetery feeincome £86,000.

3.1.5. Countryside and Landscape are projecting an over−recovery in income of £153,000of which £65,000 is due to increased staff costs for the Commonwealth Games (asdescribed in paragraph 3.1.1), and miscellaneous income of £22,000. WithinGreenspace the WIAT and Social Prescribing projects have created overspendwithin expenditure (mainly employee, site improvement and forestry costs), all ofwhich is fully funded through grant income £61,000.

3.2. Within Facility Support Services there is a £104,000 underspend within Supplies andServices forecast which mainly relates to food costs due to service demand levels andtherefore a corresponding reduction in income from departments.

3.3. Planning and Development are currently projecting increased Building Standardsincome of £146,000 based on a slight improvement in the year to date income figureshowever this will continue to be monitored closely throughout the year. They are alsoforecasting a £142,000 overspend in Employee costs mainly as a result of turnoversaving not being fully achieved £50,000 and staff savings not being fully achieved£88,000.

3.4. Roads and Transportation are currently projecting a £97,000 underspend in Employeecosts mainly due to vacancies. This is offset by increased advertising costs for theDisability Discrimination Act £25,000 and reduced income for roads constructionconsents £44,000 and sales, fees and charges £35,000.

3.5. Protective Services are currently projecting an overspend in Employee costs of £32,000as a result of turnover savings not being fully achieved. This is offset mainly by savingsin transport costs £14,000,sample fees £7,000 and additional project income £12,000.

3.6. There are several Regeneration projects which are either externally funded or matchfunded from the Council; at period 3 it is forecast that all these projects will remain in linewith budget. The year to date and outturn position for each project are detailed inAppendix 4.

3.7. The Service operates with an establishment of 2,644.53 FTEs and a budgeted turnoverrequirement of £2.221m (78.87 FTEs). As at period 3, the Service has 154.25 FTEvacant posts, equating to projected full−year savings of £2.35m. However for the overallService Employee costs are projected to be £266,000 overspent due to the employmentof seasonal and casual staff to cover vacancies and the over established posts relatedto savings. The service is currently not projecting to achieve its turnover requirementin Environment and Estates, Planning and Development and Protective Services asexplained above in paragraphs 3.1.1, 3.3 and 3.5 this will continue to be monitored andif required requests for virements will be included in future reports. There is alsoongoing recruitment particularly in Facility Support Services for essential posts.

3.8. Payments to other bodies are detailed in Appendix 3. These account for £20.576m ofthe Service's annual budget and are currently expected to be under budget by £4,000due to reduced requirement for scientific samples £7,000, partially offset by other minorvariances.

4. Budget Virements

4.1 A budget virement has been reflected within the current accounts for Land Managementwithin Environment and Estates to adjust their income and expenditure by £110,000 tobring them more in line with service demand levels.

5. 2014−2015 Budget Savings

5.1. As outlined in paragraph 2.4 above, Regeneration and Environmental Services havemade good progress in delivering its approved 2014−15 efficiency saving of £4.968m.However, some delays in reconfiguring the service are likely to lead to £227,000 ofapproved savings not fully realising in this financial year, but being achieved elsewhere.The service aims to achieve the targeted amounts through management of vacanciesand the actions outlined in paragraph 6.

6. Management Actions6.1. The Service is taking a range of management action to ensure it contains expenditure,

as far as possible, within its approved 2014−15 budget provision. These measuresinclude delays in recruiting seasonal/non essential staff and curtailment of non essentialexpenditure.

7. Risks and Uncertainty

7.1. The Council's Risk Management Strategy, approved September 2012, recognises thereare risks involved in everything it does, with the current economic climate in particularhaving potential to impact upon the Council's ability to provide quality services within itsexisting budgetary provision.

7.2. Risks are a combination of probability and impact of particular events, and Regenerationand Environmental Services manage these as part of the overall corporate and serviceplanning processes. There is currently a potential legal case pending within Planningwhich may have a material impact on Regeneration and Environmental Services if theoutcome is not favourable to North Lanarkshire Council. This will continue to bemonitored and reported once the timescale and values become known.

8. Financial Concurrence

8.1. Prepared in accordance with the Scheme of Financial Delegation, the financialinformation contained within this report has been agreed with the Head of FinancialServices.

9. Recommendations

9.1. It is recommended that the contents of this report be noted.

9.2. Committee is asked to approve the budget virement outlined in section 4.1

PAUL JUKESExecutive Director of Regeneration and Environmental Services

Local Government Access to Information Act: for further information about this report, please contactRobert Coiquhoun, Business Service Manager, Finance & Technology Solutions 01236 632444

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