Council / SIC projecting overspend
SHETLAND Islands Council (SIC) is projecting to be overspent by £2.5 million at the end of the financial year – but the position is expected to improve over coming months.
The figure, which represents the position at the end of June, was presented to a meeting of the council’s policy and resources committee on Monday.
Finance manager Paul Fraser said the £2.5 million figure related to the general fund revenue budget – the day to day spend.
It mainly accounts for savings not yet achieved.
The council’s 2023/24 budget included savings reviews among every directorate in the SIC, with a one per cent savings target on top.
Fraser said feedback from SIC departments was that this was proving a difficult process.
The total projected draw from reserves on both revenue and capital expenditure is £33.4 million, which is £1.8 million over the revised budgeted draw of £31.6 million.
But Shetland Central councillor Davie Sandison reiterated that whilst the “vacancy factor” is a key part of making savings, there is a requirement to hire more expensive agency staff to fill gaps in essential services.
While the financial projection is likely to change through the year, Fraser said it seems likely there will still be a revenue overspend come the end of 2023/24.
Meanwhile the council’s investments rose in value by £7 million over the first quarter of the 2023/24 financial year.
This involved a £10 million investment return and £3 million which was withdrawn and returned to the council. The overall value of investments at the end of July was £386 million.
Council leader Emma Macdonald said it was a positive step forward for the investments, but highlighted it was only a three month snapshot.
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