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Senior Managers are responsible for ensuring that within any financial year they take all reasonable measures to ensure an approved Revenue or Capital Budget within their control is not overspent.

Senior Managers must seek to ensure that there is no shortfall in the budgeted level of income.

When a projected overspend (or under recovery of income) is forecast to occur in a section of the Revenue Budget, or on a scheme within the Capital Programme, Senior Managers and other responsible officers must take measures to eliminate or reduce the overspend and maintain records of such actions.

The Chief Finance Officer must be informed of potential budget variances in accordance with budget monitoring guidelines. The overspend will be the subject of a report to the Executive. Further details on the detailed responsibilities of the Chief Finance Officer and the Senior Managers can be found in the separate Financial Procedures Manual.

These rules aim to allow the Executive to manage the budget once it has been approved by Council, whilst also providing for good governance of financial matters. For more details on Virements please see FM2, FM5 and FA10 of Appendix A to these Rules.

A virement is the transfer of resources from one budget head to another, during a financial year. It is thus the financial consequence of a change in priority of service delivery or in the means by which services are delivered. It can also be the use of resources provided within the budget framework, but which are not allocated for any specific purpose e.g. unallocated contingency. A virement will naturally flow from, and be part of, a decision.

The Executive shall have the power to vire resources within each of the above components of the Budget Framework agreed by Council, subject to the following limitations:

Budget Holder in agreement with a Director

Budget Holder in agreement with the Directors from both affected portfolios

Much of the flow of money across the Council originates from services provided by one department to another. This, in a number of cases, stems from internal trading account services. To facilitate proper controls and the management of the Council's budgets, transactions need to be raised and processed in an efficient and effective manner. This should ensure that purchasers are charged promptly and pay within a commercially acceptable timescale, and that trading services invoice their customers in the knowledge that payment will be received within that stated time-scale. Where practicable these processes will be automated. The budget for core services e.g. admin buildings, payroll and legal will remain with the purchaser and the Chief Finance Officer will stipulate corporate arrangements for managing these recharges. For ad-hoc and project works the process follows similar principles to the ordering of and payment for goods and services. To ensure that the process is operating in accordance with the framework, regular departmental monitoring of incoming and outgoing recharges needs to be carried out. The Chief Finance Officer (or their delegate) will act as an arbitrator to resolve disputes that cannot be settled between purchaser and provider. This is to ensure that all disputes are resolved within a stated timescale and will not adversely affect financial monitoring. It is the responsibility of the purchaser to ensure that they have sufficient resources to pay for commissioned project and ad-hoc work. It is the responsibility of the provider before work commences to advise the purchaser if the work is not covered by the core support service budget and needs specific financing.