Issue - meetings

Purpose of the Report

(a)         To present to the Executive the provisional 2020/21 financial outturn position on the Council’s revenue and capital budgets, including:

·         General Fund;

·         Housing Revenue Account;

·         Housing Repairs Service; and

·         Capital Programmes.

(b)         To provide the Executive with a summary of the actual income and expenditure compared to the revised budget and how any surpluses have been allocated to reserves.

Decision

(1)         That the provisional 2020/21 financial outturn for the General Fund, Housing Revenue Account, Housing Repairs Service and Capital Programmes (as set out in sections 3 – 7 of the report), and in particular the reasons for any variances, be noted.

(2)         That the transfers to General Fund earmarked reserves (as detailed in paragraph 3.12) and Housing Revenue Account earmarked reserves (as detailed in paragraph 4.6 of the report) be approved.

(3)         That the General Fund carry forward requests (as detailed in paragraph 3.14 of the report), which had not been requested at Quarter 3, be approved.

(4)         That the financial changes to both the General Investment Programme and the Housing Investment Programme (paragraphs 7.3 and 7.9 of the report), which were above the 10% budget variance limit, as delegated to the Chief Finance Officer, be approved.

Alternative Options Considered and Rejected

None. 

Reasons for Decision

Covid-19 had taken its toll on the financial resilience of the Council during 2020/21 as income streams had declined, and there were additional costs in continuing services during the pandemic.  These impacts were not limited to the 2020/21 financial year, but would affect the period of the medium term financial strategy.  In terms of the financial year 2020/21, the key challenges were the costs and demands arising from the pandemic. This had resulted in significant shortfalls on the General Fund prior to the support from the Government.  It was highlighted that for the General Fund the financial performance quarterly monitoring report for the third quarter had predicted an underspend against the revised budget of £122,723.  The provisional outturn for 2020/21 was now indicating an overall budget underspend of £148,381 (including proposed transfers to/from earmarked reserves and carry forward requests).  The financial impact of Covid-19 on the Council equated to circa £7 million. A breakdown of key variances to the General Fund was detailed at paragraph 3.3 of the report.

In advance of any financial support from the Government, the Council had implemented measures to reduce certain areas of expenditure, which ensured that the Council delivered its critical services and its financial balances would provide resilience for future years.

In response to requests from local authorities, the Government allocated a total of £4.6 billion of grant funding to support local authorities for expenditure pressures. The Government had also introduced an income compensation scheme for approximately 75p in every £1 of lost sales, fees and charges income. In additional a local tax income guarantee scheme compensated local authorities for 75% of irrecoverable losses in Council Tax and Business Rates. To date the Council had received funding support of £1.877 million for Covid-19  ...  view the full minutes text for item 3