Agenda item

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

1.     To note and accept the NWEAB's end of August 2024 revenue review.

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

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

The report was presented by the Host Authority's Head of Finance Department.

RESOLVED

1.     To note and accept the NWEAB's end of August 2024 revenue review.

2.     To note and accept the NWEAB's reserves update.

3.     To agree the NWEAB's revised capital expenditure profile.

REASONS FOR THE DECISION

·       To note a forecast underspend of £5,966 against the revenue budget in 2024/25.

·       To note a further slippage on the capital programme, with an estimate of £14.28m expenditure in 2024/25 compared with the approved budget of £24.67m for the year. 

DISCUSSION

It was explained that the report noted the actual revenue position to the end of August 2024 and also estimated the position up to the current financial year. An underspend of £6,000 was projected by the end of the 2024/25 financial year and various elements of the budget were detailed as follows:

·       Net overspending of £9,368 for the 'Portfolio Management Office' was forecast as a result of overspending on supplies and services. It was noted that this overspend derived from systems costs and it was explained that this budget heading would need to be reviewed for the future.

·       It was explained that the £20,000 underspend of 'Cyngor Gwynedd's Finance Services Support' would be used to fund the spending on external financial support which formed a part of the 'Projects' heading.

·       It was confirmed that spending under the 'Joint Committee' heading was expected to be within the budget for 2024/25.

·       It was noted that the 'Projects' heading indicated a net overspend of £70,000. It was explained that this was mainly due to external legal support that was required for several capital programme projects.

·       It was explained that the 'Grants' heading included expenditure on local Area Energy projects and the Shared Prosperity Fund. It was confirmed that an extension until March 2025 had recently been received on the Local Area Energy grant, therefore, this overspend would be funded by the grant.

            Reference was made to principal income streams for the 2024/25 financial year. It was noted that these included partner contributions, the 'North Wales Growth Deal Grant' revenue allocation of the Welsh Government Energy grant, the North Wales Corporate Joint Committee, the Shared Prosperity Fund and the reserve fund.

            The position of the Board's funds was reported stating that there was an estimated balance of nearly £211,000 in the general reserve fund. There was an estimated balance of £152,000 in the projects fund and £7.2 million in the interest fund. It was explained that the interest fund had been earmarked to fund future borrowing costs. It was noted that high interest currently meant that the Board received a significant amount of interest on the balances with an estimated interest of £2.5 million for 2024/25.

            The latest position of the capital programme was shared stating a net reduction of £10.39 million in projected expenditure for 2024-25. It was explained that this was due to delays on four projects, namely 'Smart Local Energy', 'Deeside Fuel to Waste', 'Holyhead Port' and the 'Former North Wales Hospital Site'. However, it was noted that there was likely expenditure on the 'Centre for Environmental Biotechnology' and 'Tourism Talent Network' projects within the current financial year. It was elaborated that there was a potential two-year delay on the 'Kinmel Studio' and 'Glynllifon Rural Economy Hub' projects.

            It was confirmed that the Growth Deal grant of £56.9 million already received was sufficient to fund expenditure up to the end of the 2025/26 financial year based on this revised spending profile.

            In response to an enquiry about overspending on External Legal and Financial Support under the 'Projects' heading, the Assistant Head of Finance confirmed that external financial support had been used to receive input on business applications. It was acknowledged that this had led to overspending within the 'Projects' title, but it was emphasised that underspending within 'Finance Support Services' met this overspending. It was elaborated that the increase in legal expenditure derived from an increase in contracts matters as the Board's projects were developed sooner and expert negotiations to support agreements. The need to re-consider the budget for future legal support was noted.