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Today, the final report on our financial position for the end of 2023/24 has been published as part of the agenda for Transformation and Improvement Overview and Scrutiny Committee, alongside the first monthly report of the new financial year.
2023/24 outturn
The outturn report confirms that we made an exceptional £41m of savings in 2023/24, more than we have ever made before, despite rising demand for our services and higher costs from long period of high inflation. This is thanks to more robust reporting, a clear plan and much hard work from colleagues.
We also ended the year with a higher than projected balance in our general fund reserves, the pot of money that provides resilience and helps manage the uncertain financial future we cannot predict. At the end of the year, the balance was £8.2m and this is already budgeted to increase by £30m in this financial year to give us more resilience for any challenges that lie ahead. This is still low for a council of our size but gives some security as we head into another year with even more savings to make.
Finally, we ended the year with a lower than expected overspend of £7.9m, instead of £14m predicted when we reported on the third quarter of the year.
Overspending comes as a result of growing demand pressures affecting councils all over the country, especially in social care and temporary accommodation, but has its own challenges in a large, rural county like ours with a population having complex heath and care needs.
Minimising this by managing demand through innovation, early help and prevention, as we have done, is key to staying in control of our budget and gives us a healthier start to the new financial year.
Period 1
This is the first time we have published monthly finance reports and this reflects our commitment to regular, robust and transparent reporting.
Everybody who manages a budget has access to a detailed Power BI finance dashboard, with tools to track progress towards our savings target of £62.5m in this financial year. It is more important than ever to use every tool we have to keep this ‘single version of the truth’ accurate and up to date. This is everybody’s responsibility.
Whilst our challenge this year is even bigger than last year, period 1 shows we are already making good progress.
Over 15% of our savings target has already been delivered or is firmly projected to deliver, and there are firm plans already in place for another £38m of savings. The remaining £14m is the subject of ongoing work, but finalised plans have not yet been signed off.
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The year ahead is going to be a challenge; there is no doubt we will have to dig deeper than we ever have before and this will include difficult decisions.
We are focusing on reducing our spending with third parties, managing demand for our services, increasing our income, reviewing our assets to reduce running costs and becoming a smaller council, with fewer people.
Resizing
Resizing the organisation is just one of the ways we will make the savings we legally must make, and our voluntary redundancy programme is the first step.
We are also reviewing data from all managers, to determine where there are existing vacancies that can be removed, alongside more detailed service reviews.
We are reviewing our use of agency staff and, where appropriate, bringing these colleagues into our workforce instead, which is better for our budget and gives employment benefits to these people too.
We are completing all these steps in this order to establish the potential figures and plan our next steps.
Keeping the number of redundancies to a minimum and making savings by other means remains our priority, as we overcome our challenge to become the financially healthy council we need to be to continue delivering The Shropshire Plan.
A new way of working
Some of our plans to transform the way we operate are dependent on decisions by our Cabinet. Following the announcement of the General Election, we have had to postpone this. This means that some decisions will take place after the election date of 4 July 2024 and we will update you as soon as we are able to.
We know that uncertain times can be unsettling for colleagues. If you need support, please use the wellbeing support pages on the intranet for resources that might help.
I will update you again soon when there is more to share on our next steps.
As ever, thank you everybody for your ongoing hard work.
Andy Begley
Chief Executive
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