Issue - meetings

The Portfolio Holder for Corporate Governance, Finance and Resources to submit a report providing financial progress information on the General Fund and Special Expenses for period 1 April to 30 September 2021.

Cabinet NOTED the year-end forecast and financial position for the General Fund and Special Expenses at 30th September 2021 for both revenue and capital.

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 to 30 September 2021.

Mrs. Garton advised that the forecasted position on general expenses was an underspend of approximately £193k.  This was primarily due to the £362k Covid contingency and without it, the Council would have been in an overspend position.  The forecasted position on special expenses Melton Mowbray was an overspend of £11k.  On capital expenditure, budget holders were forecasted to spend in line with the budget.  However, it was likely that some projects would roll over into next year, particularly for those larger projects, such as the Asset Development Programme (and budgets would roll over into next year).

Mrs Garton confirmed that the key pressure on the budget was the ongoing reduction in income from car parking, the loss of the leisure management fee  and the unbudgeted pay award.  Loss of income had been mitigated in the first quarter by the government’s Income Compensation Scheme but this had not continued beyond 30 June 2021.  The financial impact of Covid-19, including ongoing pressures affecting next year’s budget was detailed at paragraph 9.2 of the report.  It was anticipated that the residual balance from the Covid contingency would be needed to support next year's budget, in addition to the consideration of savings to balance the budget next year.

Mrs. Garton highlighted the strategic risk to the Council’s finances, as detailed at paragraph 15 of the report.  This was the highest risk on the Council's Risk Register and had been exacerbated by the pandemic.  There had been some positive news in the Spending Review but great uncertainty about how funding would be distributed amongst councils remained and Members were aware of the forecasted gap on next year's budget.

Councillor Ronnie de Burle, Portfolio Holder for Corporate Governance, Finance and Resources reiterated the points highlighted by Mrs Garton, adding that the report clearly illustrated the financial challenges, which the Council continued to face, due to the growing impact of Covid-19.  Delivery of the forecasted underspend on the general fund for this financial year was only made possible by incorporating savings and fully utilising the Covid contingency and Income Compensation Scheme.  The Council must remain very cautious in its aspirations because significant shortfalls in income would continue into next year and setting a balanced budget for 2022/23 would be challenging.  Difficult decisions would need to be made to secure the Council's financial sustainability and it was important to plan and prepare to ensure the Council remained financially sustainable and able to deliver against core priorities and responsibilities.

Councillor de Burle commented that the Spending Review for local government appeared to be generous.  However, it was not clear how funding would be distributed and it was unlikely to fully mitigate the sizable ongoing income losses.  Any underspend in this current year would be critical to helping the Council to lessen the impact of income  ...  view the full minutes text for item 210