Overspend expected following delayed opening of community farm

Twm Owen Local Democracy Reporter

The delayed reopening of a popular farm attraction could cost a council more than £400,000 and contribute to a potential overspend.

Greenmeadow Community Farm is due to reopen to the public for the first time in nearly three years on Saturday, September 13 following a multi million pound redevelopment.

When contractors were appointed, in July 2024, it was anticipated building work could take nine months with the council owned attraction expected to open in April this year.

However that was delayed with an “end of summer” date promised before Torfaen Borough Council confirmed the attraction, that closed for redevelopment in October 2022, would reopen on September 13.

The council’s cabinet was however told, at its Tuesday, September 2 meeting, the prolonged closure will hit the council coffers.

Report

A report for the Labour cabinet warned the trading account for Greenmeadow Farm could be £407,000 in the red by the end of this financial year in March.

Robert Green, the council’s head of financial services, told councillors: “You are all aware of the situation and the later than anticipated opening, that has financial consequences. It’s important to highlight until it opens there’s lots of variables, and to see how they play out, in terms of trading conditions and those are estimates based on assumptions.”

Overall the council has warned it could finish the financial year with a £624,000 overspend against the budget it agreed in March.

But Mr Green said the projection, based on spending figures from April to July, month four of the financial year, aren’t something the finance team “feel unduly concerned about”.

He added: “12 months ago they were significantly higher and we still produced a balanced position.

“We are reasonably confident, barring any major pressures, unforeseen emergencies, we can still have a balanced position.”

The council monitors its spending and costs throughout the year and reports variances against each departmental budget with favourable changes balancing out adverse over runs.

The highest potential adverse budget area is housing benefit, with Mr Green explaining the full cost of temporary accommodation isn’t covered by the UK Government’s Department of Work and Pensions, leaving the council with a potential £373,000 overspend against its agreed budget.

Uncertainty

Greenmeadow Farm’s trading account is part of the council’s adults and communities directorate which is reporting a projected £271,000 adverse variance meaning underspends in other areas off set the projected losses.

A report, presented by Mr Green, said the farm’s £407,000 deficit could change: “This current projection takes account of the agreed opening date, anticipated income generation during the remainder of the year and the costs involved in operating the facility.

“At this stage of the financial year, there remains a degree of uncertainty regarding the trading position for the facility, with greater clarity only expected once trading begins.”

He said the intention is to mitigate the costs within the adults and communities service but said there is available funds in the reserves to cover the “one off pressure”.

Children’s social care, which drove the council’s projected overspend last year, is now reporting a “minor adverse variance” with the children and families directorate projecting a small, favourable underspend against budget.

The report said forecast placement numbers of 424 children in care is below the budgeted number, of 438, but a “requirement” to use more expensive unregulated placements has added some cost pressures.

That has been off set by savings including reduced contract inflation and “employee-related savings” of £400,000. As part of the budget for the current year the council put in place a £1.9 million transition fund to support children’s services and so far only £461,000 is required in order to balance the overall position.

Mr Green also said it isn’t anticipated all planned budget savings will be achieved this year but it is hoped they will be in the following financial year.

Council leader Anthony Hunt said he had “confidence” in the council’s finance team and said the potential £624,000 overspend “needs to be viewed in the context of a £248 million budget.”