The following should be read in conjunction with Part 5E 'Budget and Policy Framework Procedure Rules' of the Constitution.
2.1 It is the responsibility of Directors and budget managers, advised by the Finance team, to control income and expenditure within their area of responsibility and control, and to monitor performance using financial information derived from corporate financial systems maintained by the Section 151 Officer.
2.2 For capital this will include keeping under review the County Council's agreed capital programme for services under their control covering schemes and projects in progress, schemes and projects commencing in the current and forthcoming financial years and the revenue implications of those schemes and projects.
2.3 Budget monitoring data should be maintained at a level which enables effective monitoring of financial trends to be carried out, and to provide action plans to ensure adverse budget problems can be managed.
2.4 Cabinet will ensure that the budget approved by Council is implemented and will receive reports from the Section 151 Officer and Directors to enable it to discharge this responsibility.
2.5 The Section 151 Officer in consultation with Directors will establish an appropriate format and frequency for monitoring the County Council's financial performance (to Directors, budget managers and Cabinet) in compliance with regulations and best practice.
2.6 Directors and budget managers, with advice from Finance, will control and manage capital and revenue spending and income to ensure that each is contained within their approved budget. Directors and budget managers will investigate any variations and take appropriate action to deal with them.
2.7 The Section 151 Officer will support and advise Directors and budget managers in ensuring that financial management information is adequate for management purposes and that they have appropriate access to financial information via the corporate financial systems to enable budgets to be monitored effectively.
2.8 The Section 151 Officer will report monthly to the Corporate Management Team, and quarterly to Cabinet on the overall likely outturn position and any significant variances.
2.9 The financial information submitted by each Director for reporting to the Corporate Management Team, Cabinet and relevant Committees, will be supported by non-financial performance relating to those aspects of services regarded as the major drivers of expenditure impacting on future levels of service activity.
2.10 Directors will provide the Section 151 Officer with any information required to enable effective monthly monitoring and reporting to the Corporate Management Team, Cabinet and relevant Committees of expenditure and income against approved budgets, and will report on variances within their own areas of responsibility. They will take any action necessary to ensure that expenditure does not exceed their budget allocations and income does not fall below the budget allocations and will inform the Section 151 Officer where they are unable to take action to keep expenditure and income within their budget allocations, as soon as these are identified. Directors and budget managers will document decisions and actions adequately.
2.11 Where additional significant savings and/ or increased income (excluding grants), in excess of £250,000 and below £500,000 have been delivered and were not included in the revenue budget agreed by Council, these new resources will be reported to Cabinet for a decision to be taken on their utilisation. Where the additional significant savings and/or increased income (excluding grants) is above £500,000 these new resources will be reported to Council for a decision to be taken on their utilisation.
3.1 The approval of Council will be sought for any proposal that involves a change to the Budget and Policy Framework such that this would have a financial effect on the County Council's forward planning of resources or significantly limit the discretion of Council in the future allocation of its resources.
Revenue Budget
3.2 Subject to paragraph 3.3 below, the approved revenue budget may be amended by:
(a) The Cabinet approving transfers to or from contingencies, and to an earmarked reserve;
(b) The Council approving transfers to or from general reserves; and
(c) The Section 151 Officer (in consultation with relevant Director) approving budget transfers from an earmarked reserve for its designated purpose.
3.3 In making amendments to the approved revenue budget, the Cabinet, Section 151 Officer and Directors will:
(a) have regard to the Budget and Policy Framework approved by Council, and resolutions of Council; and
(b) be satisfied that an amendment to the revenue budget can be offset by additional income, contingencies, earmarked and general reserves within the revenue budget.
3.4 Annex A of these Rules (PDF 10kb) provides a summary of the amendment of approved budgets - revenue.
3.5 Any proposed amendments to revenue budgets will be subject to the advice of the Section 151 Officer. Following approval the amendment of revenue budgets will be recorded in the corporate financial systems.
Capital Budget (new schemes)
3.6 Directors have no power to approve new capital schemes to the capital programme. All capital schemes need Cabinet or Council approval as indicated below.
3.7 Cabinet may approve the inclusion of a new scheme in the capital programme, of up to £500,000 where it can be funded by additional government grants, and grants and/or contributions from external bodies.
3.8 Council is required to approve a new scheme in the capital programme of up to £500,000 if it will be funded from capital receipts, prudential borrowing and/ or revenue contributions.
3.9 The approval of Council is required for any new scheme of sums greater than £500,000.
3.10 Cabinet may approve the inclusion of scheme specific capital feasibility work in the capital programme up to £250,000. Scheme specific capital feasibility work of a value £250,001 or above will require the approval of Council.
3.11 If subsequently the capital scheme for which the capital feasibility work was undertaken is not approved the capital expenditure incurred will be charged to revenue.
3.12 In making amendments to the approved capital programme, Council and Cabinet will:
a) Have regard to the Budget and Policy Framework approved by Council, and resolutions of Council;
b) Be satisfied that an amendment to the approved capital programme can be financed; and
c) Be satisfied that any revenue budget consequences of the amendment can be offset by additional income, contingency, or earmarked reserves or reserves, within the revenue budget.
3.13 Any proposed amendments to capital programme will be subject to the advice of the Section 151 Officer.
3.14 Annex A (PDF 10kb) provides a summary of the amendment of approved budgets - capital.
4.1 A revenue budget approved by Council may be spent without further reference to Council, the Cabinet (including a Committee appointed by Cabinet) or Committees appointed by Council.
4.2 No power is delegated to any Director to spend above the approved budget for their area of responsibility unless or until the relevant rules for amendment of approved budgets at section 3 and budget transfers at section 6 have been followed.
The following should be read in conjunction with Part 5E 'Budget and Policy Framework Procedure Rules', of this Constitution.
Revenue Budgets
6.1 In consultation with the Director of Finance (S151 Officer), Directors (or budget managers with the appropriate Director(s) approval) may transfer (vire) any revenue budget within their responsibility and control for any lawful purpose relating to the Directorate for which they are responsible providing that:
(a) The budget transfer is within the estimate approved by Council for the relevant Directorate;
(b) The reason for the transfer is within the Budget and Policy Framework;
(c) No commitment to a higher overall level of expenditure in future financial years is entered into;
(d) The amount in question does not exceed £250,000, and
(e) No other Directorate is affected, subject to where a budget transfer between budgets is controlled by more than one Director, the transfer is agreed by all the Directors concerned.
6.2 Cabinet may transfer any revenue budget within its control for any lawful purpose for which they are responsible providing that:
(a) The transfer is within the estimate approved by Council for the relevant Directorate;
(b) The reason for the transfer is within the Budget and Policy Framework;
(c) No commitment to a higher overall level of expenditure in future financial years is entered into; and
(d) The amount in question does not exceed £500,000.
6.3 Any transfer of revenue budget not falling within the criteria detailed in paragraphs 6.1 and 6.2 as set out above will require approval of Council.
6.4 Any proposed virement to revenue budgets will be subject to the advice of the Section 151 Officer. Following approval the virement of revenue budgets will be recorded in the corporate financial systems.
6.5 Approval of virements will not be anticipated or assumed in advance. Directors should not present to Cabinet or Council requests for virement to meet commitments already entered into; proper monitoring routines should identify the need for virement (and/or adjustments to expenditure) sufficiently in advance for options to be identified and planned and appropriate action to be taken.
6.6 Annex B (PDF 131kb) provides a summary of the transfer of budgets (virement) - revenue.
Capital Budget
6.7 Cabinet may transfer any budget between schemes within the capital programme within its control for any lawful purpose for which it is responsible, providing that: -
(a) The reason for the budget transfer is within the Budget and Policy Framework;
(b) Be satisfied that any revenue budget consequences of the budget transfer can be offset by additional income, earmarked or general reserves or savings elsewhere within the capital programme; and
(c) The amount in question does not exceed £500,000 at any one occasion.
6.8 Any transfer of budget between capital schemes not falling within the criteria detailed in paragraph 6.7 as set out above, but subject to paragraph 6.9 below, will require approval of Council.
6.9 The Assistant Director Environment and Enterprise or other identified accountable Director may authorise a virement between projects within a scheme of an amount up to £250,000
6.10 Any proposed virement to the capital programme will be subject to the advice of the Section 151 Officer.
6.11 Annex B (PDF 131kb) provides a summary of the transfer of budgets (virement) - capital.
9.1 Section 25 of the Local Government Act 2003 places a duty on the Director of Finance (Section 151 Officer) to report to Council about whether the proposed reserves will be enough for the County Council's purposes and support the budget. This includes general reserves and reserves earmarked for specified purposes.
9.2 Cabinet has the authority to agree transfers to/from contingency and transfers to earmarked reserves. Transfers from earmarked reserves are agreed by the S151 officer providing the transfer is for the purpose which earmarking was agreed by Cabinet.
9.3 Requests for earmarked reserves and provisions will be submitted by Directors to the Section 151 Officer for consideration before recommending to Cabinet.
9.4 When requested and in any event, always at the financial year end, Directors will provide the Section 151 Officer with a statement of earmarked reserve balances held and movements therein. The Section 151 Officer will consider the continuing relevance and adequacy of reserves (earmarked reserves and General Fund balances), and make recommendations to the Cabinet and Council.
The following should be read in conjunction with Part 2D of this Constitution.
10.1 Each Local Committee may transfer budgets over the various services within its delegated responsibility, within the limitations of the guidance issued by Cabinet.
