Budget monitoring – half-year position

Report of the treasurer 

The papers attached show the budget for 2023/24 and the actual 2023/24 expenditure and income up to 30th September, the halfway point in the year. Whilst it is good practice to report this to members it is recognised that, on its own, it is of limited value. For this reason the report also provides a forecast for the year which takes due account of real-life changes that have taken place since the budget was set.

The headings where a significant variation from budget is forecast are:

  • Salaries – an underspend of around £7,800 is forecast. This is the best forecast that can currently be made with the pay award for 2023 still not settled. The forecast allows a little for an improvement in the offer thus far made. A saving arose during the gap between when Andy Longville left before the start of the financial year and when his successor, Kevin Terry, started. Another saving arose from a reduction this year in the percentage of salaries that the Council is required to pay into the pension fund;
  • Interest received – the Town Council has substantial investment with Wyre Forest District Council and with interest rates having risen considerably the forecast of income has increased by £6,700 to £8,000;
  • Income from burial fees – this has been lower than budgeted so far this year and is forecast to fall short of the budget by £19,000. This is a particularly difficult budget to forecast and difficult, of course, to do anything to affect the amount of income received. It is early days yet and this income will be monitored carefully but it could be that reduced income will give the Council an ongoing budgetary issue. A shortfall in income is, of course, as much of a problem as unbudgeted spending. The shortfall arises from fewer burials in April-September 2023 compared with April-September 2022 and, in particular, fewer ‘outside Stourport’ burials for which the Council’s charge is doubled;
  • Grave-digging – arising from the ‘fewer burials’ point above the cost of grave-digging is forecast to be £6,300 compared with a budget of £10,000;
  • Community Centre – 3 new doors - not budgeted for but spending of £7,248 approved by Finance Committee in March;
  • Sink hole behind Civic Hall – the work to investigate and the fill in the hole in the drive cost the Council £4,460 and was not covered by the insurance policy;
  • Bandstand repairs in Memorial Park – this estimated cost of £3,960 was discussed at Parks Committee and the spending was approved by email by members of Finance Committee in August;
  • Civic Hall – RAAC (concrete) survey – following the national ‘crisis’ about RAAC a survey of the Civic Hall (owned by the Town Council) was carried out at a cost of £1,750 and, fortunately, no further spending is expected to be required;
  • Civic Hall rent – in December 2022 the Council approved an increase in the rent to £10,000 but, following further discussions later, the rent was not increase and currently still stands at £4,500. A shortfall of £5,500 is, therefore, forecast.
  • Community Centre – at budget time it was not at all clear how the balance between spending and income would work out. Largely as a result of hard work by the Town Council the Community Centre now looks much better, is more secure and attractive to hirers and is generating significant income. A surplus for the year of £4,100 is now forecast compared with the budgeted deficit of £2,100 so a turnaround of £6,200.

At this stage, net spending is forecast to be £387,000 compared with a budget of £370,000. So an overall overspend of around £17,000 is forecast but much can change in the second half of the year. The Council holds balances of £98,000 which can meet an overspend of this size. The position will be reviewed in February when the Council will need to decide on its precept for 2024/25.

This meeting does, of course, provide an opportunity to consider not only the remainder of the current financial year but also, preliminarily, the budget for 2024/25 and the finances of the Town Council for the years ahead. The Town Council has taken on many additional responsibilities in recent years – not just the riverside toilets, the paddling pool and the community centre but also Lloyds Meadow, Britannia Gardens etc.. The ongoing financial costs of these additional responsibilities are now becoming much clearer. The Town Council now needs to consider whether it wants to include in its annual budgets some contributions to new funds to meet the substantial, but only occasional, costs of replacing major items such as the roof of the community centre or the roof of the riverside toilets. A good example of this sort of issue is that the Town Clerk has received a quotation of £35,000 for replacing the surface of the paddling pool. A decision re the surface of the paddling pool is not needed now but one way in which the Council may be able to meet such a cost is by, in the 2024/25 budget, setting up one or more new funds to meet such costs and, thereby, put the future of the newly-acquired responsibilities onto a secure ongoing basis. If the Town Council is keen to replace the surface of the paddling pool in time for the 2024 season without causing a large increase in the precept for 2024/25 then it may be possible to:

  • start making contributions to a fund in the 2023/24 accounts even though this has not been budgeted; and
  • make use of the funds already set aside for other purposes – this could possibly include an understanding that the funds will only be ‘borrowed’ from the existing fund.

The Committee is invited to comment on, and discuss, any of these points and/or raise any queries.


Graham Shaw
25th October 2023