Discussion:
The Chief Finance Officer introduced the report advising that at present there was a forecast shortfall for the 2010/2011 revenue budget of £1.236m although some £339,000 of this was as a consequence of an inability to generate the full value of savings from the mid year cuts. The council was committed to fund the shortfall in savings which were expected as a consequence of the likely redundancy and early retirement costs associated with staffing reductions together with an inability to achieve the full year effect in some cases. If necessary, this would come from reserves but hopefully, as the balance of the year unfolded further savings against forecasts would materialise and make this unnecessary.
The Chief Finance Officer emphasised that children’s social care continued to be a large financial pressure for the council, as the number of referrals continued to increase. Also, another area of concern was unsubsidised accommodation for particularly vulnerable young people. This type of supported accommodation (informally referred to as “half-way houses”) offered by external providers within Medway continued to be a problem. This was because the council was restricted in the amount of money it could recover from the government for individuals living in this type of accommodation and claiming benefit in Medway. However, work had started to investigate and challenge these claims further.
Decision:
Members noted the forecast outturn position for 2010/2011 and the proposed management action to reduce the potential deficit.