Contact: Nick Gibbins, (01962) 847544; [email protected]

1 Summary

1.1 There is an overspending of £5.6m against the 2005/06 revised budget, as a result of an overspending of £11.1m on Adult Services, offset by underspendings of £5.5m on other budgets. The overall position is more favourable by about £2.4m than forecast in the last monitoring report in April.

1.2 The following decisions are sought:

i) that the variations in service cash-limited expenditure, as set out in Table 1, be approved

ii) that the accounts be closed on the basis that:

· Environment retains 50% of its underspending in accordance with the County Council's financial management policy

· Policy and Resources and Recreation and Heritage carry forward their overspendings to 2006/07, also in accordance with the County Council's financial management policy.

· Adult Services' overspending in 2005/06 be written off in accordance with the proposed recovery strategy.

iii) that adjustments and variations on other budgets as set out in Table 3 be approved

iv) that the net overspending of £5.6m be taken from balances, and that a further risk assessment of the minimum level of balances be made in July in the light of the Adult Services recovery plan and action determined to recover £3.5m or more to replenish balances.

v) that contributions to and from earmarked reserves be made as set out in Appendix 4 and the draft protocol set out in Annex 2 to the appendix be approved

vi) that the report on the County Council's treasury management activities as set out in Appendix 5 be approved

vii) that the prudential indicators set out in Appendix 6 be approved for submission to the County Council

viii) that the backward look annual efficiency statement for 2005/06 be approved for submission to the Department for Communities and Local Government, as set out in Appendix 7

ix) that the final accounts of the Hampshire Pension Fund contained in Appendix 8 be approved and submitted to the County Council

x) that the final accounts of the County Council for 2005/06 be approved and submitted to the County Council

xi) that progress in implementing financial management policies as set out in Appendix 9 be noted

xii) that capital payments for the year be financed as set out in Table 3 of Appendix 10

xiii) that the carry forward of capital schemes from 2005/06 to 2006/07 as set out in Annex 2 of Appendix 10 be noted

xiv) that services' capital programme cash limits for 2006/07 be increased by the sums shown in:

a) column 6 of the table in Annex 1 to Appendix 10 (to reflect the carry forward of capital schemes and the balance of cash limits from 2005/06)

b) column 3 of the table in Annex 5 to Appendix 10 (to reflect services' share of capital receipts).

2 Reason

2.1 To enable the Cabinet to review the 2005/06 final accounts prior to their submission to the County Council for approval. Consideration of this report supports Aim 5 of the Corporate Strategy.

3 Other options considered and rejected:

3.1 Not applicable.

4 Conflicts of interest declared by the decision maker or other Executive member consulted

4.1 Not applicable.

5 Dispensation granted by the Standards Committee

5.1 Not applicable.

6 Reason(s) for the matter being dealt with if urgent

6.1 Not applicable

Approved by: (signature) Date: (date of decision)

Councillor T K Thornber