“Immediate mitigating action” is needed at Slough Borough Council to manage a £11.7m pressure on its budget for this year (2024/25).
The council overspent its 2023/24 budget by £14.182m, which will need to be financed from reserves, according to the authority’s latest revenue and capital budget outturn report.
Slough has been under government intervention since December 2021; with a section 114 notice having been issued earlier that year.
In their latest report, as reported, the government-appointed commissioners said intervention may be needed at Slough beyond the currently stated end point of 30 November 2024, as improvement has been “insufficient and inconsistent”.
The council’s financial recovery plan is heavily dependent on the delivery of its asset disposal strategy, but the revenue and capital budget outturn report revealed how this has so far fallen short.
Slough’s treasury management strategy states a target of generating £400m from asset sales to the year ended 31 March 2024, but disposals yielded capital receipts of £195m in 2022/23 and £29.7m in 2023/24 – totalling £224.7m to date gross (£223.5m net).
The report also noted that a £600m target for asset sales up to 31 March 2027 has proven “unrealistic” and is now under review.
Some asset disposals have been pushed back to 2024/25 and 2025/26, with the authority expecting a further £72.8m of sales income.
The report additionally states that the council will need a capitalisation direction, granted in 2021, “for some years to come”. The Exceptional Financial Support by way of the capitalisation direction as at 31 March 2024 is estimated to be £298.6m, financed by net capital receipts from the asset disposals.
Another refresh of the authority’s medium-term financial plan will now be presented to cabinet, including proposals for changes to the capital programme.
The revenue and capital budget outturn report states that 2023/24 was a “challenging year” for the council, “due to the actions, savings and transformation needed due to its unique circumstances arising from the issuing of a s114 notice in 2021”.
The report also notes the impact of “national economic factors” such as inflation and the continuing increase in demand for services, with homelessness and adult social care particularly impacting Slough, and generating “significant” overspends.
Additionally, the departure of Adele Taylor, executive director of finance & commercial, and deputy directors in the last quarter of the year, had “inevitably created a degree of uncertainty, given the constant churn at this level in the organisation over the last few years”, the report stated.
Taylor has since been appointed as interim director of finance and customer service, and section 151 officer, at Cheshire East Council.
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