The report of the City Treasurer is enclosed

A report was submitted to provide a summary of the position of the 2018/19 revenue budget at the end of August 2018. The report gave details of the projected variances to budgets, the position of the Housing Revenue Account, Council Tax and business rate collection, revised prudential borrowing indicators, and the state of the Council’s contingency funds. Projecting forward from the position at the end of August 2018 it was forecast that by the year-end in March 2019 the revenue budget would be overspent by £6.145m, which was better than the previous projection of an £13.749m overspend as reported in July (Minute Exe/18/77).

The report explained the steps that had been taken since July to reduce the size of the projected overspend. The budget recovery plan was referred to in July had been implemented

The report examined a proposed change in one of the Prudential Indicators for 2018/19 that had been set by the Council in March 2018 as part of the resolution of the Council’s 2018/19 budget (Minute CC/18/17). The indicator for non HRA Capital Expenditure for 2018/19 was forecast to be higher than the target that had been set. It was therefore proposed that the non HRA Capital Expenditure limit now be set at £600m.

The following revenue budget virements were proposed and agreed:

·         £292k in Revenue and Benefits and Shared Service Centre transferred from pay to non-pay to enable to service to meet non pay service pressures. Transfer of £189k budget (£283k in 2019/20) for the Research function from City Policy to Performance, Research and Intelligence Team following a service review.

·         Transfer of £1.701m budget for Work, Skills and Manchester Adult Education Services and £495k budget for Planning Licensing and Building Control function from the Neighbourhoods Directorate to Strategic Development in line with the changes in Directorate functions approved by Personnel Committee (Minute PC/18/16).

·         Transfer of £0.613m budget for the Commissioning Children's Placement Team from Adult Social Care Directorate to Children's services Directorate following a service review.

When setting the 2018/19 budget the Council has agreed to hold some funds that were to be allocated throughout the year. The report proposed the use of some of these budgets to be allocated. These were agreed:

·         Pay Inflation - £5.150m for the costs of the pay award which was agreed as 2% at Grade 4 and above with higher percentage increases at Grades 1 to 3. This has been allocated across the council’s pay budgets.

·         Non pay inflation - Children’s Services inflationary increase - £1.859m to support the continued delivery of the Looked After Children strategy.

The report also addressed use of the Council reserves. It explained that the draw-down of £18k of the English Institute of Sport Reserve was requested to invest in sports programmes. That was approved.

1.         To recommend to Council that the revised Prudential Indicator for non HRA Capital Expenditure be set at £600m.

2.         To note the report.

3.         To approve the proposed virements as set out above.

4.         To approve the use of budgets to be allocated and contingency as shown above.

5.         To approve the use of reserves as set out above.