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There is no summary of this meeting yet. One is written once the council publishes the minutes. The agenda and papers are below.
Apologies for absence were received from County Councillors: D Bebb, E. Vaughan, R Devlin. Officers: Clive Pinney, James Chappelle, Adam Jones, Dr Richard Jones, Marie James Lynne Hamilton Observer – Chair of Governance and Audit Committee.
There were no Declarations of Interest from Members relating to items to be considered on the agenda.
Background The Portfolio Holder for Finance and Corporate Services gave a brief synopsis of the report. Points raised by the Panel: Responses received from Officers or Cabinet Members. Overall Q3 Revenue Position & Sustainability • Asked whether the improved Quarter 3 revenue position had been anticipated or whether it had come as a surprise. • Questioned whether the improved position could realistically be maintained through to the end of the financial year. • Panel Members asked whether any further unexpected financial changes might arise in Quarter 4. • Queried whether falling inflation and potential interest‑rate reductions would continue to support the position. In response to questions about whether the improved Quarter 3 position had been anticipated and whether it could be sustained, officers explained that the improvement resulted from several positive movements across services. Some small additional grants had been received, but the main driver had been strong financial management within service areas, where budgets were closely monitored and controlled. The Cabinet Member emphasised that the budget was an “organic beast” that moved continually, but at that stage there was no indication that the position would deteriorate before the year end. Officers confirmed that falling inflation and the prospect of interest‑rate reductions would assist both the revenue and capital positions. A further end‑of‑February forecast was also planned to track the trajectory of the year‑end outcome. Temporary Accommodation & Homelessness • Whether reductions in temporary accommodation costs were due to falling demand or more cost‑effective solutions. • Sought clarity on the impact of the homelessness triage model, including the reported 27–30% reduction in homelessness presentations. Officers reported that the reduction in temporary accommodation costs was driven largely by the success of the homelessness triage model. This model focused on early, preventative action and had reduced homelessness presentations by approximately 27–30% over recent years. As a result, the Council had seen declining reliance on more expensive options such as bed‑and‑breakfast accommodation. The improvement was attributed to both reduced demand and the introduction of more cost‑effective solutions. Adult Social Care Savings (£1.9m) • Panel Members questioned why £1.9 million of Adult Services savings had shifted from “achievable” to “not achieved / not assured”. • Whether the savings targets had been overly ambitious when originally proposed. • Requested assurance that the undelivered elements would be achieved early in the next financial year. • Queried whether the savings being rolled forward were in addition to, or part of, existing savings requirements. • Whether any of the savings overlapped with work undertaken through the Newton Europe analysis. • What specific factors were driving increasing care costs, including the influence of provider uplifts and open‑book processes. In relation to the shift of £1.9 million of Adult Services savings from “achievable” to “not achieved / not assured,” officers explained that two main issues had contributed. First, savings linked to Day Opportunity staffing changes had taken longer than anticipated to implement and could not be delivered within the financial year. Second, savings associated with right‑sizing domiciliary care packages had reached the point where historic opportunities were largely exhausted. The service had already achieved several years of substantial reductions and could no longer guarantee further reductions with confidence. Officers stressed that while these savings could not be achieved in‑year, mitigation had been identified and delivery was expected early in the next financial year. They also clarified that none of the figures involved any double‑counting with opportunities identified through the Newton Europe analysis, which would begin generating benefits from the following year. Learning from Undelivered Savings • Whether undelivered savings were formally reviewed to understand the reasons for non‑delivery. • Requested examples of savings that had not been delivered and the lessons learned from them. • Queried whether unrealistic savings proposals continued to appear in annual budget setting. Responding to questions about learning from undelivered savings, officers outlined that a formal review approach—described as a “plan‑to‑review” (PDR)—had been embedded within service areas. Undelivered savings were analysed to understand the reasons for non‑delivery, and this informed improvements for future budget planning. Officers also noted that before the new budget had been developed, services had examined which savings had proved particularly challenging and ensured that similar proposals were not repeated unless delivery confidence was high. A brief summary explaining reasons for non‑delivery had already been provided during the year, demonstrating the Council’s commitment to transparency and learning. Highways, Transport & Recycling (Revenue Pressures) • Why £0.5 million of Highways savings remained undelivered and had been moved into the financial model for future years. • Questioned whether income‑generation ideas (such as increased parking charges or commercial waste income) would appear in the next year’s council‑tax papers. • The Chair asked why the undelivered Highways saving was being charged to the financial plan for future years rather than to the risk budget. • Panel Members asked how reliably the service forecast future demand, and whether the Council risked sudden unanticipated pressures. Officers confirmed that £506,000 of undelivered Highways savings related mainly to service‑redesign activity that had not been completed in time. This included work dependent on staffing restructures and digital transformation. Although income‑generation ideas had been discussed earlier in the year, the service confirmed that these would not be relied upon to cover the undelivered saving, and the saving would instead be delivered through redesign in 2026–27. Car‑park charges had been frozen for the following year, meaning that income‑generation options would not appear in council tax reports. When asked why this sum would be addressed through the financial‑resource model rather than the risk budget, officers repeated that the service was confident it could deliver the saving next year and therefore did not require risk‑budget support. Officers further confirmed that demand forecasting remained challenging because many Highways costs were affected by external factors such as weather and asset condition, although modelling work continued to improve. Budget Complexity & Demand‑Led Pressures • Whether forecasting models for statutory services were sufficiently robust. • Queried whether some demand pressures labelled as “unexpected” could have been anticipated with better modelling. • Raised concerns about the overall complexity of the budget, including heavy reliance on virements, re‑profiling and in‑year adjustments. Officers explained that the Council operated in a demand‑led environment, particularly in statutory services such as social care and education. As a result, forecasting could never be exact, and unexpected pressures could emerge when residents’ needs changed suddenly. The Chief Executive emphasised that pressure in statutory services such as social care inevitably squeezed discretionary services such as highways, contributing to infrastructure deterioration. Officers highlighted that mid‑year reviews, horizon scanning and continual updates to financial modelling were undertaken to manage these uncertainties. Children’s Services Staffing & Vacancy Management • Whether balancing the Children’s Services budget through vacancy‑holding risked leaving essential work incomplete. · Queried why posts such as Environmental Health roles and the place‑based planning role had remained vacant. Officers clarified that balancing the Children’s Services budget by holding certain vacancies did not compromise front‑line delivery. All essential and front‑line posts remained fully staffed, and only peripheral posts that did not impact child safety or statutory duties had been held vacant temporarily. The service also referred to the success of its Grow‑Your‑Own workforce programme, which was expected to produce 8–10 newly qualified social workers, making it prudent to hold some posts open to ensure future placement flexibility. Schools Funding, Post‑16 Provision & Deficit Positions • How much potential income the Council lost due to approximately 600 post‑16 learners being educated outside the county. • Whether delegated school budgets for 11–16 pupils were being used to subsidise sixth‑form provision. • How schools funded any additional post‑16 courses not included within the countywide curriculum offer. • Questioned why secondary‑school deficits were being netted off against surpluses from other phases, noting that surpluses were unlikely to recover the deficit. • Panel Members asked for the true total secondary deficit figure, before being offset by other school balances. • Chair asked for clarification on the total deficit within schools’ delegated budgets before any netting‑off with school surpluses, noting that the table presented showed only net positions. He emphasised that the gross deficit represented the Council’s true financial risk exposure and requested that this figure be provided. Officers reported that the grant for post‑16 provision provided around £4,900 per learner, based on three‑year retention rates, and acknowledged that the county lost approximately 600 learners each year to providers outside Powys. If all those learners had remained in the county, the Council might have received an additional £2.9 million, although officers noted that a proportion of those learners would always choose alternative settings. Officers reiterated that all sixth‑form provision must now operate within the post‑16 grant envelope and that schools had collectively agreed a sustainable curriculum model. Any courses outside the agreed model would require the school to consider how funding could be met without breaching financial regulations. Officers also recognised concerns around secondary‑school deficits and confirmed that detailed deficit reporting was included in budget tables, with further clarity available upon request. Officer confirmed that the detailed gross (pre‑net) deficit figure was not available at the meeting and stated would need to provide this information outside the meeting. Director of Corporate Services added that a previous report on school reserves contained relevant information and offered to circulate the link to that report for members’ reference. Identification of Income Streams • Why emerging or potential income streams were not routinely highlighted in financial reporting. Transport‑Related Grants & Funding Flow · Panel Members asked whether the significant transport‑related grants were exclusively for Powys or shared with neighbouring authorities. · Queried the total value of bus‑related grants, having noted that combined allocations appeared to total around £15 million. Officers explained that potential income streams were considered when appropriate, but income generation was not always suitable or reliable in demand‑led or statutory service areas. In some cases, past attempts at income generation had not produced sustainable returns. For that reason, not all income ideas were included in routine reporting unless they were sufficiently developed and deliverable. In response to questions regarding bus‑service grants and transport funding, officers clarified that Powys received a range of grants totalling around £15–16 million for integrated transport. Some transport‑related funding, such as the Regional Transport Delivery Plan allocation, was shared with Ceredigion, while others—such as youth travel subsidies—were Powys‑specific. Officers confirmed that grant consolidation by Welsh Government had caused some confusion but that each funding stream was fully accounted for within Highways, Transport and Recycling. Tendering, Procurement & Value for Money • How tender submissions were challenged, particularly when costs appeared significantly higher than expected. • Questioned whether the Council automatically accepted the lowest bid or undertook detailed scrutiny of contractors’ costings. • Whether external specialists were used to provide cost assurance for major capital projects. • Suggested that councillors would benefit from a seminar explaining the tender evaluation and challenge process. Officers emphasised that a rigorous tendering process was in place. All bids were assessed against cost and quality criteria, and challenge was routinely applied where estimates appeared too high. In some cases, the Council had rejected tenders and re‑engineered project scopes to reduce costs before retendering. Benchmarking was also undertaken against Welsh Government standards and other local authorities. For large school‑building projects, the Council had procured the services of AECOM to provide additional cost‑management expertise. Officers confirmed that learning was shared through participation in the CLAW consortium, and the Leader noted that Welsh Government acted as a final safeguard by refusing to fund school‑capital schemes if value for money was not demonstrated. Councillors’ suggestion of a seminar on procurement processes was welcomed.
Panel made the following observations: The Panel endorsed that; • The improved Quarter 3 financial position, including the forecast underspend of £1.4 million, reflected strengthened financial management and tighter service‑level budget control. • The reduction in temporary accommodation costs had demonstrated the positive impact of the homelessness triage model and the shift toward early, preventative interventions. • Overall performance across services had contributed to stabilising the Council’s revenue position during a challenging year. The Panel welcomed that; • Falling inflation and the possibility of lower interest rates were expected to support both the revenue and capital budgets. • Children’s Services had maintained a balanced financial position while sustaining full staffing levels within frontline teams. • Additional grant income received during the quarter had strengthened the overall financial outlook without reliance on one‑off measures. • Adult Services had taken steps to mitigate undelivered savings and anticipated delivering those savings early in the next financial year. The Panel requested that; • Further assurance be provided regarding the achievability of the £1.9 million Adult Services savings that had been reclassified as undeliverable in‑year. • The updated end‑of‑February forecast be shared to confirm whether the positive trajectory would continue to year‑end. • Learning from undelivered savings be presented clearly to demonstrate how the Council was improving its approach to setting realistic and deliverable savings targets. • Further work be undertaken to understand the scale of lost post‑16 funding associated with learners educated outside the county. The Panel remained unconvinced of; • The robustness of Adult Services’ savings plans, given the significant movement between Quarter 2 and Quarter 3 in the assessment of savings deliverability. • The strength of demand‑forecasting processes in key statutory services, noting the continued emergence of unforeseen cost pressures. • The reasons cited for the slippage in Highways savings, especially given the £506,000 carry‑forward into 2026–27. The Panel expressed concern of; • The overall scale of undelivered savings across the organisation and the associated risks to future financial sustainability. • The worsening position within the schools delegated budget, particularly in relation to secondary‑sector deficits and the implications of pupils studying outside the county. • That reliance on vacancy‑holding to deliver savings in some service areas risked masking underlying structural cost pressures. • That, despite improvements in Quarter 3, demand‑led services continued to show volatility and required close monitoring for the remainder of the financial year. No recommendations were raised.
Background: The Portfolio Holder for Finance and Corporate Services gave a brief outline Points raised by the Panel: Responses received from Officers or Cabinet Members. a. Road Network Investment & Reprofiling • Panel Members asked whether current capital funding levels were adequate to address the scale of deterioration across the road network. • Questioned the reasons for extensive reprofiling of capital budgets and whether these were driven primarily by delayed grants. b. Timing & Delivery of Highway Works • Why more resurfacing and road maintenance was not scheduled within the summer months when weather conditions were more favourable. • Queried whether trunk‑road work commitments during summer months caused resource shortages for Powys‑managed roads. c. Workforce Capacity in Depots • Expressed concern that reported staffing levels in some depots suggested that up to half the workforce was unavailable at times. Officers responded that although around £20 million in highways capital funding had been secured, the scale of the county’s 5,000‑kilometre network meant significantly higher sums—potentially £800–900 million—would be required to restore it fully. Capital programmes were therefore prioritised based on need. Reprofiling of budgets occurred for reasons including grant timing, planning delays, design changes, and tendering outcomes. Officers acknowledged that summer months provided more favourable conditions but noted that operational capacity could be affected by commitments to trunk‑road work undertaken under contract with the Trunk Road Agency. Some works also had to be phased due to contractor availability, weather‑related delays, or unforeseen events such as damage to bridges. Despite these challenges, officers remained confident that planned works would be delivered within Quarter 4. Regarding reports of low staffing levels in certain depots, officers explained that fluctuations occurred due to sickness, leave and operational demands, but confirmed that a combination of in‑house teams and local contractors was used to maintain service delivery. Workforce issues were recognised as a broader matter suitable for scrutiny by the relevant committee. Capital Funding Levels, Sufficiency & Long‑Term Need · Panel Members asked whether the capital funding available for Highways—described as approximately £20 million—was sufficient to address the overall deterioration across the county’s 5,000‑kilometre road network, given estimates of £800–900 million to restore it fully. · Questioned whether the current level of grant funding could realistically keep pace with long‑term asset pressures. Officers explained that although approximately £20 million had been invested in the highways capital programme, this sum represented only a small fraction of the scale of need across the county’s 5,000‑kilometre network. The Officer demonstrated this by noting that resurfacing works completed to date had cost an average of around £178,000 per kilometre, and by extension full network renewal would likely require between £800 million and £900 million. This calculation illustrated that grant funding, while welcome, could not realistically be expected to resolve long‑standing asset pressures on its own. Reprofiling of Capital Budgets & Reasons for Delay • Why such a significant amount of capital funding had been reprofiled within Quarter 3 and sought clarity on whether this movement was driven mostly by late grant receipts, planning delays, project redesigns, or other structural causes. • Queried whether widespread reprofiling indicated systemic slippage in project delivery timelines. Officers responded that capital budgets were reprofiled for a number of reasons, and not solely because of grant timings. Planning delays, design revisions, changes arising during the tendering process and service‑specific delivery issues all contributed to movement of budgets across financial years. Officers confirmed that these were normal features of a complex capital programme rather than evidence of systemic failure. The appended service commentaries provided detailed explanations for each scheme affected during Quarter 3. Certainty and Continuity of Capital Grants • How confident the Council could be about receiving similar levels of capital grant funding in the following year, particularly in light of political uncertainty and an upcoming election. The Cabinet Member explained that there was considerable uncertainty regarding future capital grants, especially in a year preceding national election. Officers noted that Welsh Government typically issued indicative figures through the settlement process, but these were rarely finalised until later. Furthermore, Ministers retained discretion to allocate additional grants after the main settlement had been issued. The Council therefore relied on the best information available at each stage while recognising that grant levels in future years could not be guaranteed. Asset Sales, Capital Receipts & Borrowing Implications • Panel Members asked whether the £850,000 already received in capital receipts, along with the additional £900,000 agreed but not yet completed, originated from the County Farm Estate or from a broader mix of Council‑owned assets. • Sought clarity on how asset disposals aligned with reducing the Council’s long‑term borrowing requirements, especially within the school‑building programme where borrowing costs were significant. The Leader clarified that capital receipts achieved to date came from a range of Council‑owned assets, not solely from the County Farm Estate. Officers indicated that the pipeline of pending sales included agricultural land, commercial units, and surplus sites. The Leader further emphasised that asset disposal played an important role in reducing the scale of borrowing necessary to deliver major capital programmes. For example, every £1 million of borrowing required for the schools capital programme translated into an annual revenue charge of around £60,000 for the life of the loan, making capital receipts a vital means of containing long‑term financial pressures. Status, Risks & Delivery of Specific Capital Programmes a. Highways Capital Programme • Questioned the meaning of service commentaries stating that programmes were “generally on track” and asked which specific schemes were not on track and what risks those delays posed. • Panel Members asked whether reported progress could be maintained given that 30% of capital expenditure still remained to be delivered in Quarter 4. b. Housing Revenue Account (HRA) Capital Programme • Why certain housing developments experienced “unavoidable and unforeseen regulatory delays” and sought clarification on what types of regulatory issues—such as biodiversity constraints—had caused the delays. Officers confirmed that although service commentaries stated that programmes were “generally on track,” this wording reflected the fact that the majority—but not all—of the listed schemes were progressing as planned. Further explained that unforeseen incidents such as damaged bridges, contractor capacity issues or adverse weather could create delays. However, the service remained confident that most outstanding works could be completed within Quarter 4, and where this was not possible, unspent allocations would be carried into the next financial year. It was clarified that the “unavoidable and unforeseen regulatory delays” referenced in the HRA commentary related largely to external compliance issues. In one example, major housing developments had been delayed due to biodiversity constraints, such as the presence of protected species including newts. Such regulatory requirements had caused unavoidable slippage to construction timetables. Timing of Capital Works, Seasonal Constraints & Workforce Capacity • Panel Members asked whether the timing of road‑surfacing work aligned appropriately with seasonal conditions, noting that summer months provided longer working windows and more suitable weather. • Questioned why some capital works appeared to be concentrated in winter rather than being brought forward earlier in the year. • Queried whether the Council’s own workforce was heavily allocated to trunk‑road responsibilities during the summer and whether this created pressure on delivering local capital schemes. • Expressed concern about reported shortages in depot staffing levels and asked whether workforce capacity issues risked slowing delivery of the capital programme. It was explained that although summer months offered better working conditions for surfacing and reconstruction, the scheduling of capital works had to consider competing demands on both the in‑house workforce and external contractors. A significant proportion of the Council’s directly employed teams were committed to delivering trunk‑road responsibilities during the summer under contractual arrangements with the Trunk Road Agency. Officers further acknowledged that the distribution of works throughout the year also depended upon contractor capacity, weather variations, and the availability of materials. Despite Members’ concerns about workforce shortages in specific depots, it was stated that a blend of internal crews and external contractors enabled the service to maintain planned delivery levels. Workforce issues, however, were recognised as an appropriate subject for further scrutiny. Schools Capital, Borrowing & Decarbonisation Funding • Whether the long‑term financing costs of new school buildings—such as the reported per‑pupil charge associated with large capital schemes—were borne by the whole Council or specifically by the Education service. • requested clarity on the £1 million allocation for school decarbonisation works and asked why the associated programme had not progressed more quickly. In response to questions about the long‑term financing of new school buildings, it was confirmed that capital borrowing costs associated with such schemes were borne by the Council as a whole rather than directly by the Education service. This ensured fairness in how major infrastructure investments were supported across the organisation’s financial framework. Regarding the decarbonisation funding, the officers explained that the £1 million allocation related partly to site‑safeguarding works approved earlier in the year. Additional grants were also being used for separate carbon‑offsetting activity. It was also acknowledged that further detail could be provided at a future scrutiny session for Members seeking greater clarity. Tendering, Cost Control & Procurement Assurance • How the Council challenged tender prices, especially where submissions were significantly higher than expected. • Questioned whether officers relied solely on in‑house teams to assess and challenge multi‑million‑pound tenders or whether external technical expertise was commissioned to validate costs. • How the Council compared its tender pricing with other local authorities and whether rural‑area cost uplifts were being appropriately scrutinised. • Panel Members suggested that councillors would benefit from a seminar covering how tenders were evaluated and challenged, including an overview of the additional scrutiny layers required in the public sector. It was confirmed that the Council operated a rigorous tendering process, with all submissions assessed against defined cost and quality criteria. Where costs appeared unreasonably high, the procurement teams challenged contractors through detailed scrutiny and benchmarking. In some cases, tenders had been rejected and projects re‑engineered to reduce scope or cost before retendering. The service also benchmarked its projects against Welsh Government standards and comparable work in other local authorities. For major school‑capital projects, the Council had procured specialist external cost‑management support to strengthen challenge and ensure value for money. The Leader added that Welsh Government served as an additional safeguard, as funding for school programmes would not be released if the Council failed to demonstrate robust due diligence. Officers welcomed the suggestion of providing Councillors with a seminar outlining the tendering process in greater depth. Action: Corporate Services to provide an all-Member Briefing / Seminar on the Outlining of the Tendering Process.
The Panel endorsed that: • The highways capital programme had progressed well, with a substantial volume of resurfacing work completed and significant grant funding supporting delivery. • Capital investment across several grant streams had enabled meaningful progress on improvements to the road network and wider infrastructure. • Overall capital expenditure had remained broadly on track for the financial year despite operational and seasonal challenges. The Panel welcomed that: • The Council had secured a high level of external capital funding, enabling progress across highways, transport, housing and school projects. • Most highways schemes were expected to reach completion during Quarter 4, with only unavoidable delays requiring rollover into the next year. • The programme of asset disposals was generating capital receipts that would help reduce future borrowing commitments. The Panel requested that: • Greater clarity be provided on the assets being sold, including which were drawn from the County Farm Estate and which from other parts of the Council’s property portfolio. • More detailed information be supplied on the £1 million allocated to school decarbonisation works, including timelines and reasons for delay. • Reporting of highways schemes described as “generally on track” include specific details of those at risk of slippage. • Further explanation be given on the regulatory and environmental issues that had contributed to delays within the Housing Revenue Account capital programme. The Panel remained unconvinced of: • The extent to which capital reprofiling had been caused solely by external pressures, raising questions about internal delivery capacity. • The sufficiency of long‑term investment in the county’s road network, considering the scale of need compared with current funding levels. • The feasibility of delivering the volume of outstanding capital work within Quarter 4, given the proportion of expenditure still remaining at the end of Quarter 3. The Panel expressed concern of: · The growing impact of environmental and regulatory issues—such as biodiversity requirements—on the timely delivery of housing developments. · The pressure placed on the highways workforce by summer trunk‑road obligations and the consequent effect on local capital delivery. · Ongoing challenges created by contractor availability and higher rural construction costs, which continued to affect capital schemes. · The risk that tendering delays, particularly where bids were higher than anticipated, might push essential projects into future years despite efforts to retender or re‑engineer schemes. No recommendations were raised.
Noted.
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