Issue - meetings

The Portfolio Holder for Corporate Finance and Resources to submit a report providing financial progress information on the General Fund and Special Expenses for period 1 April 2019 to 30 September 2020.

Cabinet NOTED the year end forecast and financial position for the General Fund and Special Expenses at 30th September 2020

Dawn Garton, Director for Corporate Services introduced the report, the purpose of which was to provide financial progress information on the General Fund and Special Expenses for period 1 April 2019 to 30 September 2020.

Mrs. Garton highlighted the forecasted underspends of approximately £100k on the General Fund and £4k on Special Expenses.  A portion of Covid-19 costs to be charged to Special Expenses was being considered and would change the current position slightly.  The forecasts included the estimated impact of Covid-19 (additional expenditure, estimated lost income, reduced by government grants including the income support scheme).  The Council was awaiting information on the Leisure Grant Scheme and some outstanding new burdens funding but there may also be further costs arising from any local lockdowns and in response to the current national lockdown.  The forecasts did not take into account any bad debts, which may arise and need to be written off from council tax, business rates and other income streams (e.g. property rentals). 

Mrs. Garton advised that the more positive position (than previously forecasted) had been achieved as a result of over £400k of savings from delayed or halted work, alongside vacancy savings from held posts, which would impact some areas in work programmes and capacity.  If this had not been achieved, the shortfall would need to be met from limited revenue reserves, which would impact on the Council’s future financial sustainability.

Mrs. Garton drew Members attention to the risk section within the report and the overall strategic risk relating to the Council’s finances, which reflected the pressure of future financial sustainability, as a result of a number of years of funding reductions, the current uncertainty of future local government funding and the added pressure caused by Covid-19 both currently and in the future.  The budget setting process for 2021/22 had started and there were many unknown factors (the level of Government grant for Covid-19 and business as usual activities for later years, the impact on business rates and council tax collection and growth, when income levels will return to pre Covid-19 levels).  Setting a balanced budget for 2021/22, without significant additional Government support would be challenging and there was a high risk of savings having to be made to meet this challenge.  Against this background any surplus from this year would be essential to mitigate financial challenges in future years.

Councillor Ronnie de Burle, Portfolio Holder for Corporate Finance and Resources commented that the Council had responded well to challenges within this financial year.  He advised that although an estimated underspend on the General Fund was very positive, it must be noted that this had only been achieved due to the significant savings identified in year.  There remained much uncertainty on the level to which those finances would be challenged further by bad debts, the ongoing support to businesses and the community, as well as any impact of further national and local lockdowns.

Councillor de Burle reiterated that the Council would face significant financial challenges in budgeting for the  ...  view the full minutes text for item 128