Posted by: John Brace | 7th September 2019

Wirral Council overspent its budget by £4.327 million in first three months of this financial year!

Wirral Council overspent its budget by £4.327 million in first three months of this financial year!

                                                  

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Cabinet (Wirral Council) 2nd September 2019

Wirral Council Cabinet (2nd September 2019) Cllr Pat Hackett (right) presenting a finance report on quarter 1

Wirral Council Cabinet (2nd September 2019) Cllr Pat Hackett (right) presenting a finance report on quarter 1

In an extremely short seven minute long public meeting of Wirral Council’s Cabinet on Monday morning held at the slightly earlier time of 9.30 am, the Cabinet Member for Finance and Resources (Cllr Janette Williamson) was not present so Leader of the Council Cllr Pat Hackett gave a verbal summary of the written financial report in her absence.

The written report explained that at the end of quarter 1 (which covers the period April 2019 to June 2019) that Wirral Council is projected to overspend its planned budget by £4.327 million.

More than half of the projected budget overspend (which resulted in a forecast of a £2.5 million overspend by year end) the report explained was because the average residential placement costs for looked after children were underestimated by 17% when the budget had been prepared and agreed by councillors earlier this year.

The current demand on special education needs services in the Schools Budget is greater than the grant funding available meaning to pay for it the ring-fenced Dedicated Schools Grant of £2.3 million was being used.

The Safer Wirral Hub was predicted to underachieve its income target by the end of the year by £220,000 due to the loss of clients such as Magenta Housing and schools converting to academies.

Car parking income was expected to fall short of expectations by £300,000 and the loss of income from fixed penalty notices following the termination of the Kingdom contract earlier this year was also mentioned in the report.

Cabinet noted the report and made some minor recommendations to a public meeting of all councillors regarding changes to the capital part of the budget (for clarity the projected overspend was in the revenue part of Wirral Council’s budget).

Budgetary matters are the responsibility of all 66 of Wirral Council’s councillors.

Wirral Council have also failed to publish its final audited accounts for the previous 2018-19 financial year by the legal deadline of 31st July 2019.

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Responses

  1. No Surprise here then!
    Maybe the one and half million they get in for the push bike racing might help

  2. Burgess 2013 :

    Small business development ,such a small slice of our hundreds of millions expenditure.

    Well every penny counts and a small slice of that £12 ,000,000,PERHAPS THE DEFRAUDED SUM OF £2,000,000, would certainly come into it’s own in balancing the books.

    You reap what you sow you muppets

  3. A public body can easily overspend its budget in the first quarter when outgoing payments exceed the quarterly incoming receipt of grant. Criticisms should await the final out-turn.

    • Pardon me but WBC accounts department will provide for that in accrued income. Large public bodies do not do

      Cash accounting

      They do accrual accounting, making provision for anticipated revenue .

      If they did not the accounts would be worthless .

      Mr Hutchinson they have truly overspent £4.2 million…I don’t have to contain my exasperation

      • Hi Nigel,

        Thanks for your comment.

        The report takes the spending in quarter 1 for 2019-20 – then predicts a £4.327 million overspend based on that spend by the end of the year.

        Obviously that is a projection – it could be worse than that figure or better by the end of the year.

        However if roughly half of the projected overspend is to do with Wirral Council underestimating the costs of residential placements for looked after children (which is going to be a problem Wirral Council can’t correct in quarters 2, 3 and 4) and some of the rest is to do with factors that Wirral Council doesn’t directly control (such as third parties cancelling contracts etc) then I think it’s fair to say that unless something happens – such as a freeze on non essential spending or in year budget changes then the £4.327 million overspend (or possibly more) will happen as a result of an unrealistic budget being set.

        There are reserves of £10 million – but these reserves would have to be replaced for the budget next year.

  4. The safer wirral hub have not worked in any way for Magenta for almost 5 years.
    Did it really take then that long to find out?
    School going to acadamies is another excuse, they lost half their schools security to a local company doing the job at commercial rates. Thye now charge less than it actually costs to do the job!!
    They have underperformed and under revenued for the past 5 years.


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