Cheshire East heads for £3.7m overspend

Cheshire East is expected to overspend it's budget in the first three months of the financial year by £3.7 million, councillors will be told.

A report to the council's Corporate Scrutiny Committee on Monday forecasts an overspend of £3.7m (1.4%) against its first quarter budget of £260.3m.

Council services facing the biggest budget pressures, totaling £7.5m, have been identified says the report and remedial action taken to trim £4.3m from spending.

The biggest demand-led service pressures are on the Children & Families Agency costs (£0.7m) and Transport savings (£0.4m); Adults Care costs (£1m) and Care4CE (£1.7m); Assets (£2m); ICT Shared Services (£0.3m); Car Parking / Leisure income (£0.5m) and Waste Service costs (£0.3m).

The council's revenue budget is forecast to overspend by 1.2% (£3.2m) with a £0.5m overspend forecast as a result of pay awards for local government staff.

East Cheshire has a savings target of £31m for this financial year and with a freeze on Council Tax it is important that they stay on track.

"The risk of non delivery of this plan, alongside emerging in-year pressures, will need to be managed and strong mitigation plans identified and delivered," warns the report.

The council may have to dip into reserves to meet the extra payouts with an expected decrease in reserves this financial year of £4.2m, leaving £14.8m in council coffers.

Cheshire East currently has debts of £5.8m, of which £2.8m is over 6 months old, according to the report. The council has a bad debt provision of £2.9m available to meet potential write-offs.

Cheshire East is still among the top third of Unitary Councils in terms of Council Tax collection with more than 99% of Council Tax and Business Rates collected within three years.

Investment income is in line with budget, the report adds, although the average interest rate earned on investments (0.4%) is slightly lower than the London Inter Bank 7 day rate.

The reports adds: "Performance information plays a vital role in ensuring that the Council celebrates its achievements, understands its performance in key areas and addresses issues of underperformance. The Council and partners have identified a series of improvement measures to support outcomes for local people as outlined in the priorities and objectives of the Sustainable Community Strategy."

You can read the full financial report on the Cheshire East website here

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