Agenda item

The Committee considered a report which summarised the projected outturn position for the Council’s general fund revenue account, based on actual and accrued data for the period April to September 2020.

Officers were projecting an increase in net expenditure on the general fund revenue account of £6,806,000.

Covid-19 continued to impact the Council in several ways including the inability to maintain income levels at those budgeted for in February 2020.  The direct expenditure incurred by the Council in the current financial year stood at £948,881, with support received from the Government of £1,954,748.  The Government support would contribute to both the direct and indirect costs of the Covid-19 pandemic.

As the pandemic continued, estimates for losses in income and increased costs had been made with the best information available, which would be subject to change as the year progressed. The report considered the expenditure and income forecasted up to 30 September (before the second lockdown occurred) and would therefore potentially move adversely as the second lockdown progressed.

The Committee was reminded that the Council, at its meeting of 5 May 2020, had approved an emergency budget to deal with the impact of Covid-19 should government support fall short of the final costs of the pandemic.  The Government had since announced further support for local authorities and figures would be updated to reflect this support once the detail had been received.

There had been a reduction (£351,107) in the statutory Minimum Revenue Provision (MRP) charge to the general fund to make provision for the repayment of past capital debt reflecting a re-profiling of capital schemes. 

A surplus on the Housing Revenue Account would enable a projected transfer of £8.53 million to the new build reserve and £2.5 million to the reserve for future capital at year-end.  The transfer was projected to be £97,384 higher than the budgeted assumption and reflected modest variations in repair and maintenance expenditure and staffing costs.

Progress against significant capital projects on the approved programme, as outlined in section 7 of the report, was being made.  The Council expected to spend £97.896 million on its capital schemes by the end of the financial year.  The expenditure was higher than it had been for many years and demonstrated progress in delivering the Council’s capital programme.

The Council’s underlying need to borrow to finance the capital programme was expected to be £74.456 million by 31 March 2021, against an estimated position of £125.956 million.  The lower underlying need to borrow was a result of slippage on both the approved and provisional capital programme, as detailed in paragraphs 7.3 to 7.6 of the report.

The Council held £143 million of investments and £276 million of external borrowing as at 30 September 2020, which included £192.5 million of HRA loans.  Officers confirmed that the Council had complied with its Prudential indicators in the period, which had been set in February 2020 as part of the Council’s Capital Strategy.

During the debate, the following comments were made by the Committee:

·       An enquiry as to where Parks and Countryside income derived from

·       It was confirmed that monies received during the year towards Special Protection Area sites were transferred to a reserve and that the net effect on the General Fund was nil.

·       It was noted that, in relation to the £120,000 set aside in the Capital Programme for new boilers for the Electric Theatre, this had been agreed with the ACM at the time they entered into the lease with the Council in 2017.

·       In response to an enquiry as to why the planning appeals budget was currently overbudget given that the budget had been increased, it was confirmed that planning appeals were £40,000 over budget and that the variance related to the loss of income on planning performance agreements.

Having considered the monitoring report, the Committee

RESOLVED: That the results of the Council’s financial monitoring for the period April to September 2020, be noted together with the above comments.

Reason:

To allow the Committee to undertake its role in relation to scrutinising the Council’s finances.