A GWENT council could be in line to achieve a nearly £1 million underspend for a second consecutive year.
Number crunchers at Torfaen Borough Council say latest figures – based on spending up to July – predict the authority should reach the end of the financial year in March with a net revenue budget underspend of just under £1 million against its total net budget of £223 million.
In June it was revealed the council had finished the 2022/23 financial year with a surplus of £975,000 – just shy of £1 million.
But a report to the Labour cabinet, from the council’s top finance officer and deputy chief executive, Nigel Aurelius, has warned of overspends in children and family services and due to greater than anticipated demand from people who need helping paying their council tax bills.
The authority’s long running problems in collecting household waste and recycling effectively are also driving an overspend in its economy and environment division.
As the council has failed to put in place an effective system for the management of household waste – which earlier this year led to it attempting to introduce black bin collections just once every three weeks – it has had to lease additional vehicles to complete refuse rounds.
The report states: “The main pressure in this service area, creating this adverse forecast, relates to vehicle leasing costs within the Recycling and Environment division being greater than budgeted. The service area is reviewing all other areas in order to mitigate the position.”
In April the cabinet said it would pause plans for three-weekly wheelie bin collections, which were being considered from April 2024, to instead focus on boosting recycling but with a warning the plan would be brought back if the campaign failed.
However the biggest spending pressure facing the council is in children’s services which could be £203,000 over budget by the end of the year.
The “high cost” of one placement has been blamed for a £433,000 projected overspend in children’s social care, with overall numbers requiring placements stable at 451 compared to 450 budgeted for. Use of agency staff has also contributed to the projected overspend.
Placements and staff requirements are constantly under review and the figure has been in part off-set by an additional social care grant.
The education division isn’t showing significant changes against budget.
Vacancies in adult social care, which the council has struggled to fill, have however helped the service to forecast a predicted £686,000 underspend meaning the Adults and Communities division has a favourable prediction of a £459,000 saving against its budget.
Vacancies across other divisions of the service are also contributing to the overall underspend but the report says the savings are partly offset due to budget pressures caused by the ongoing closure of the Greenmeadow Community Farm, which wasn’t able to be revamped and reopened this year as planned.
Council tax support had been budgeted based on 9,623 people needing help towards paying the charge that helps fund the council but those requiring help has already hit 9,671 meaning a £106,000 overspend is forecast.
Though the council is keeping overall spending within its budget and its planned £8.6 million savings are on track, the report warns it must maintain its “financial discipline” which has helped it project the £977,000 underspend.
The report reads: “In overall terms this is an encouraging position at month four and is continuing evidence of financial discipline across the council. That discipline must be maintained throughout the year, especially given the future financial challenges and headwinds.”
The report is due to be considered by the cabinet when it meets at Pontypool Civic Centre on Tuesday, September 12.