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Shropshire Council is facing £4.3m overspend
SHROPSHIRE Council is on course for a near £4.3 million over-spend on its budget for 2012/2013.
Council cabinet papers show the cash squeeze is hardest on adult social care, while the projected general fund balance as at March 2013 could be nearly £2 million less than the minimum required.
The assessments are made in revenue budget monitors, which are produced for cabinet to report on the period from June (period four) to February (period 11) of each financial year.
These reports track progress against the agreed budget decisions, forecast any significant variances and enable corrective action to be taken to ensure a balanced budget at the year’s end.
This week, cabinet heard that the projected revenue forecast for the year, at period 4, shows a potential overspend of £4.29 million – or 0.66 per cent – on a gross budget of £654 million – net £219 million – for the full year. The two individual service areas recording the most significant projected variations are: Å Assessment and eligibility (adult social care) – up £4,892,745, specifically purchasing care pressure within long and short-term support.
Å Business improvement – up £218,962 due to a shortfall of income in the print unit.
Corporate budgets, however, saw a projected variance of under 1 per cent – or £50,000.
Here, the figure was down £563,584 due to treasury management savings and slippage in the capital programme.
Further work on assessment and eligibility has been undertaken over the past month to clarify and determine the pressures and overall position of the adult social care budget.
A number of additional cost pressures have been clarified so far, including: Å Incurring full-year effect costs of £1.5 million as a consequence of continuing health care (CHC) review decisions by the Primary Care Trust. Talks are under way with the trust over easing this pressure.
Å An additional cost pressure of £0.1 million linked to the withdrawal of supporting people funding from a number of schemes.
Å A revised income prediction resulting in a cost pressure of £0.6 million.
In addition, the service has carried out an exercise to challenge and validate its current savings plans. Initial work suggests that there is likely to be an in-year shortfall of £1.9m.
Other areas of mitigation are also being considered, including the potential for additional funding from the PCT which the council has received in previous years to help cover in relation to winter pressure on care services.
But this is not guaranteed and – even if approved – won’t be confirmed until January.
The latest projection of the council’s end-of-year general fund balance is currently below both 0.5 per cent of the gross revenue budget and the level anticipated within the financial strategy due to the size of the current £4.29 million overspend.