Agenda item

Colleen Warren, Financial Services Manager,

a)    presented performance scrutiny committee with the provisional 2019/20 financial outturn position on the Council’s revenue and capital budgets

b)    explained that in relation to the General Fund Revenue Account, the financial performance quarterly monitoring report for the 3^rd quarter predicted a shortfall against the revised budget of £222,080. The provisional outturn for 2019/20 now indicated that this shortfall had decreased by £88,258, resulting in an overall budget shortfall of £133,822. This represented a variance against the revised budget of 0.99%. The key variances were as follows:

·         City Hall, Industrial Estates & Lincoln Properties – Increased Income (£167,351)

·         Housing Benefit Overpayments – Reduced Income £389,536

·         Other Interest – Increased Income (£88,080)

·         Car Parking – Increased Income (£90,912)

·         Housing Regeneration – Reduced Expenditure/Increased Income (£98,366)

·         MRP – Reduced Expenditure (£288,200)

·         Direct Revenue Financing – Reduced Expenditure (£230,475)

·         External Interest Payable – Reduced Expenditure (£222,139)

·         Yarborough LC – Reduced Income – (£53,400)

·         TFS Savings Target – Shortfall in delivery (£201,705)

c)    advised that in relation to the Housing Revenue Account, the financial performance quarterly monitoring report for the 3^rd quarter predicted an underspend of £79,582. The provisional outturn for 2019/20 now indicated an overspend of £71,514. This resulted in HRA balances at 31 March 2020 0f £1,007,095. The main over and underspends included within the provisional outturn were detailed in Appendix D, while the key variances were below:

·         HRS Surplus – Additional Income (£72,487)

·         Council Tax – Additional Expenditure £94,286

·         Depreciation – Revaluation of properties – additional expenditure (£383,122)

·         Loan Charges – Interest on additional borrowing – increased expenditure (£71,869)

·         Major Repairs Reserve – DRF adjustment to fund additional depreciation and loan charges – (£440,526)

d)    stated that in regard to the Housing Repairs Service, the financial performance quarterly monitoring report for the 3^rd quarter predicted a £117,075 surplus outturn for 2019/20. The provisional outturn for 2019/20 showed a trading surplus of £72,487. The net trading surplus of £72,487 was the result of several year-end variations in income and expenditure against the approved budget. The main over and underspends included within the provisional outturn were detailed in Appendix F and the key variances were as follows:

·         Reduced recharges for internal work and change to sub-contractor – reduced income (£181,936)

·         Reduction in material costs – reduced expenditure (£104,741)

·         Increased hire of equipment costs – additional expenditure (£87,633)

e)    highlighted that in relation to the General Investment Programme, –the last quarterly report approved a General Fund Investment Programme for 2019/20 of £12,509,748. Movements in the programme since the approved revised budget decreased actual capital expenditure in 2019/20 to £10,056,747.

New projects/changes that required the approval of the Executive were:

·         Disabled Facilities Grant – 2020/21 budget increased by £456,020 to match grant funding allocation.

·         Car Park Improvements – Ticket Machines - £87,360 within 2020/21 funded by borrowing to purchase 16 new ticket machines to ensure all car parks were able to take contactless or chip & pin payments.

The changes that had been approved by Executive and were included within the final quarter were:

·         Boultham Park Lake Restoration – a scheme to support the restoration of the lake supported by National Lottery Heritage Funding. £267,121 capital expenditure element was required and approved by Executive on 24/2/20.

·         Greetwell Hollow – settlement of dilapidations claim with Lindum of £150k agreed and sale of freehold asset for £100k capital receipt funded from unallocated resources. This was approved by Executive on 24/2/20.

f)     referred to the Housing Investment Programme and explained thatthe last quarterly report approved a Housing Investment Programme for 2019/20 of £14,906,247. Movements in the programme since the approval of the revised budget decreased actual capital expenditure to £11,977,262 in 2019/20.

The overall spending on the Housing Investment Programme for 2019/20 was £11,977,262 which was 80.19% of the revised 2019/20 programme as per MTFS 2019-24. Although this appeared to be low compared to previous financial years, the following points were taken in consideration:

·         Due to COVID-19 various scheduled work programmes had slipped or been delayed into 2020/21, with the 2020/21 budget impact still being assessed and would be reflected within 2020/21 reports.

·         9 property acquisitions were ongoing with delegated authority to start as at the 31^st March 2020, totalling £1.1m.

·         £590k had been released into available resources from the 2019/20 HIP programme

·         The budgets for large new build schemes, DeWint, Markham House and Rookery Lane had been reprofiled into 2020/21 in line with expected expenditure outflows.

g)    invited members’ comments and questions.

Question: Could more details on the Disabled Facilities Grant be provided?

Response: Every year a budget was allocated to the City of Lincoln Council from Lincolnshire County Council. There was always a delay as the spend was governed by Occupation Health assessing cases. This made it hard to deliver the estimated spend within the financial year.

Question: Members recognised that there was some money to be saved from previous years and asked what needed to take place for further savings to be made?

Response: There were technical issues with an outstanding review regarding an asset swap between the HRA and the general fund which meant that the asset swap was not completed within the financial year. This would though be progressed in 2020/21.

Question: Members asked what the allocated COVID-19 response money would be spent on?

Response: The money was spent on mitigating incomes as there was still a significant loss for what had been spent on COVID-19.

Members commented that it was good to see income (in 2019/20) for car parking had exceeded it’s budget, considering the current pandemic (note income in 2020/21 is significantly deteriorated.

RESOLVED that the financial performance outturns for 2019/20 be noted.