Showing posts with label warning. Show all posts
Showing posts with label warning. Show all posts

Thursday 12 October 2023

Brent Finance Chief issues grim warning on Council finances

 The Brent Corporate Director of Finance and Resources has issued a grim warning on the Council's financial situation following a significant over-spend on the housing service caused by a high level of demand due to increased homelessness, reduced supply of suitable temporary accommodation and subsequent higher costs. The forecast spend of £16.3m is nearly five times the original budget.

The Director informs the Cabinet that the 'seriousness of the Council's financial position cannot be understated' and stresses the need for more measures than had been planned in order to control expenditure to address the underlying issue that 'the  Council's net expenditure is significanty greater than the available sources of in-year funding'. 


Extracts from the report (Full Report that is available HERE)

The Council’s revised General Fund revenue budget for 2023/24 is £291.2m. The revised budget includes planned revenue savings in-year of £13.5m and the status of these are set out in Appendix A. There is a forecast overspend of £13.4m against the revised revenue budget at Quarter 2. If sustained until the year end, this would require a transfer from unallocated reserves.

 

Equally, any overspending not dealt with in 2023/24 would, potentially, carry over into 2024/25 thereby increasing the requirement for further savings in that year whilst at the same time providing reduced scope to draw on the Council’s reserves.

 

The seriousness of the Council’s financial position cannot be understated.

 

The scale of the financial challenge for 2023/24 and 2024/25 is such that, in addition to work currently underway to implement savings in 2023/24 and to identify new savings proposals for 2024/25 and 2025/26, the Council will need to implement further measures to control expenditure in order to address the underlying issue that the Council’s net expenditure is significantly greater than available sources of in year funding. Further details on these measures are set out below.

 

Local government is facing the most challenging financial environment for many decades. Many councils are overspending and depleting their reserves; most are experiencing the adverse effects of high inflation, high interest rates and significant increases in demand due to demographic changes. Some are even declaring bankruptcy by issuing s114 notices. Concerns about future levels of government funding are widespread. Against this backdrop, Brent has maintained a strong position in terms of financial resilience and sustainability with a good track record of delivering savings and balancing the overall budget. However, the position for 2023/24 has worsened significantly and the current forecast will require the Council to take urgent actions in the short and medium term to maintain financial control.

 

The main cause of the forecast overspend is within the Housing Service, where high levels of demand due to a rise in homelessness and reduction in supply of suitable accommodation are expected to result in an overspend of over £13m. Section 3.8 of this reports sets out the Council’s strategy in dealing with the  significant increase in costs of providing temporary accommodation for those homeless people to whom the Council owe a legal duty. While Brent is not in the financial situation of those Council’s that have recently issued, or threatened to issue, a Section 114 notice (legally required when the council cannot balance its budget, unlike the NHS and other parts of the public sector councils are not allowed to carry a deficit) all efforts must be focussed on positively changing the financial position.

 

In addition to these actions and the additional oversight provided by the Budget Assurance Panel, further measures are considered necessary to prevent the situation worsening. These will include, but are not limited to, controls on new spending decisions, limits on new recruitment, reduction in the use of agency workers, bringing forward in year savings and other mitigations to reduce expenditure. These sensible, proactive and prudent measures will provide more assurance over the Council’s spending decisions and reduce the risk that the budget position deteriorates further. These measures will remain in place until the end of the financial year, and updates provided to the Cabinet in future forecast reports and budget reports.

 

The report also includes updates on the viability of two major projects:

 

The Wembley Housing Zones project is expected to experience a viability pressure when updating the project plans to meet potential fire safety regulations. Work is already underway with the contractor, Wates, to reduce the impact of any changes required. The Morland Garden project is experiencing significant viability challenges whilst also being subject to a significant delay in the project delivery timescales dependent on the outcome of the public inquiry in relation to the stopping up order.

 

Link to 3.8 on action on Temporary Accommodation

Friday 14 February 2014

Ministers who won’t act on climate evidence must go, says Green Party

Source BBC
The UK’s response to the flooding crisis must centre on a long-term strategy to address climate change the Green Party says today, as it recommends a series of ten measures to improve the country’s flood resilience in future.

It says sustained political action on climate change is crucial to reducing the risk of severe flooding happening again.

The Party is calling for Environment Secretary Owen Paterson to be sacked and for the Prime Minister to remove Cabinet Ministers and senior government officials who refuse to accept the scientific consensus on climate change (1). The Met Office has said (2) all the evidence points to climate change contributing to these extraordinary floods.

“Politicians who ride roughshod over the painstaking findings of climate scientists (3), sometimes motivated by their inappropriately close links to fossil fuel big business, endanger our future and our children’s future”, said Green Party Leader Natalie Bennett. 

“It’s a crying shame more of the recommendations made by the The Pitt Review into the 2007 floods (4) haven’t been taken seriously by Labour, the Tories, and their Coalition government lackeys in the Lib Dem Party. But it is not too late for action.”

 Caroline Lucas, the Green Party MP for Brighton Pavilion, said:

“Across the country, homes and businesses are being devastated by the floods, and our hearts go out to everyone whose life is being turned upside down.  Nature is giving us another wake-up call.

In addition to making sure everything possible is done to help people affected by the immediate crisis, we need a credible long term strategy to tackle the risk of flooding and extreme weather to people's homes and liveilihoods in the future.”  

The call to government urges ministers to adopt the recommendations of a major independent cross sector coalition[1]  for  a Cabinet-level committee on infrastructure and climate change resilience and a Royal Commission on the long-term impacts of climate change on land.

The Green Party is also calling for all staff cuts at the Environment Agency to be cancelled, planning rules to be strengthened to prevent further development on flood plains, and for increased levels of spending on flood defences to a level in line with expert recommendations from the Environment Agency and the Climate Change Committee.

And it is supporting the call of campaigners for  the billions of UK fossil fuel subsidies and tax breaks to be used to help the victims of flooding[2]

“This redirection will address the underspend and assist the victims of flooding, as well as putting a halt to public money exacerbating the problem of climate change that is making the floods so much worse”, noted Bennett.


Notes

1)    International Panel on Climate Change Climate Change 2013 Report http://www.ipcc.ch/report/ar5/wg1/#.UvuRuf3RozU



4)    Pitt Report on floods: http://news.bbc.co.uk/1/hi/uk/7472813.stm