Agenda item

Dewi Morgan (Host Authority Head of Finance and Statutory Finance Officer) and Sian Pugh (Host Aauthority Assistant Head of Finance) to present the report.

1.     To note and accept the NWEAB's end of December 2023 revenue review (Appendix 1).

2.     To note and accept the NWEAB’s reserves update (Appendix 2).

3.     To agree the NWEAB’s revised capital expenditure profile (Appendix 3).

The report was submitted by the Assistant Head of Finance.

RESOLVED

1.     To note and accept the NWEAB's end of December 2023 revenue review (Appendix 1).

2.     To note and accept the NWEAB’s reserves update (Appendix 2).

3.     To agree the NWEAB’s revised capital expenditure profile (Appendix 3).

REASONS FOR THE DECISION

An underspend of £340,768 was forecast against the revenue budget in 2023/24. Any underspend at the end of the financial year may be transferred to reduce the amount used from the North Wales Growth Deal Grant.

To note a further slippage on the capital programme, with an estimate of £3.36m expenditure in 2023/24 compared with the approved budget of £11.25m for the year. 

DISCUSSION

Members were guided through the end of December 2023 financial review, referring to Appendix 1 which set out the true revenue position to the end of December and the projected position to the end of the financial year. Attention was drawn to the following main points:

·       That there was a net overspend of £33,000 on the Portfolio Management Office, with the main overspend on employees. It was noted that this would be funded from income from the Shared Prosperity Fund and the Corporate Joint Committee (noted as income).

·       There was an underspend of £35,000 on Support Services. It was explained that this money would be used to fund the external financial support expenditure.

·       That there was an underspend of £39,000 on the CJC due to underspending within the fields of 'external legal support', 'financial fees' and the 'Business Delivery Board'.

·       That there was a net underspend of £109,000 on Projects due mainly to underexpenditure on developing the projects' business cases.

            Sources of income for 2023/24 were reported upon and Members were reminded that an underexpenditure of £267,000 had been predicted in the August 2023 review. It was explained that this underspend had now increased to £341,000 and therefore it was suggested that a smaller amount of the growth deal be used in order to leave the Board in a neutral position for the year. It was confirmed that this figure would be confirmed at the end of the financial year.

            The fund balances were confirmed as follows:

·       The General Reserve Fund balance at 31 March 2023 was £552,000. It was noted that £274,000 had been allocated in this year's budget which left a balance of £278,000.

·       The Balance of the Projects Fund as at 31 March 2023 was £152,000 and there was likely to be no movement on the fund this year.

·       The Interest Fund Balance as at 31 March 2023 was £1.7million. It was explained that a balance of around £4.4million was forecast by the end of the financial year with the addition of the partners' interest contributions of £251,000 for 2023/24 together with around £2.5million interest on the balances (including the Growth Deal Fund) for this year being added to the fund.

            It was reported that there was a £7.89million reduction in expected spending in the capital programme for 2023/24, compared to the budget approved in March 2023. It was explained that this was due to a further reduction of £3.77million to what was envisaged in the August 2023 review following a reduction on four projects.

            It was noted that the Board was unlikely to receive a £20million annual grant contribution this year but confirmed that officials had been in discussion with the UK Government to work on a capital re-profile. It was explained that if this was successful, it could mean receiving a UK Government grant allocation in line with expenditure rather than as a flat rate over 10 years. It was recognised that this would reduce the Board's borrowing costs but borrowing costs would still exist for the Welsh Government funded element. It was confirmed that borrowing costs would result as the grant payment would be received at the end of the financial year rather than during the year as the expenditure took place.

            The Officers were thanked for their work and the report.