Agenda item

The Portfolio Holder for Corporate Finance and Resources to submit a report advising Members of the year end forecast and financial position for the General Fund and Special Expenses at 30 June 2020.

Cabinet NOTED the year end forecast and financial position for the General Fund and Special Expenses at 30th June 2019.

Dawn Garton, Director for Corporate Services introduced the report, the purpose of which was to advise Members of the year end forecast and financial position for the General Fund and Special Expenses at 30 June 2020.

Mrs. Garton highlighted the forecast for General Expenses and Special Expenses Melton Mowbray were overspends of approximately £59k and  £2k respectively.  The Council was considering an appropriate portion of Covid-19 costs to be charged to Special Expenses and would provide an update on this later in the financial year.

Mrs. Garton advised that the estimated impact of Covid-19 on additional expenditure and estimated lost income was significant.  The Council was yet to submit its first claim to the Government Income Compensation Scheme Grant but the forecast had taken into account that the grant claim may be reduced as a result of any savings made.  It had not included bad debts, which may arise and have to be written off (council tax, business rates, property rentals etc.)  The Council did not know the nature or amount due in respect of anticipated support from the Government on this.

Mrs. Garton emphasised that in order to achieve the forecasted overspends, which in light of Covid-19 were modest, the Council had considered in year service savings and had reduced budgets by approximately £284k.  If these savings had not been identified, the shortfall would have had to be met through limited revenue reserves, impacting on the Council’s future financial stability.  This has been an important piece of work and was a tremendous achievement.

Mrs. Garton highlighted the risk section and the overall strategic risk, detailed at paragraph 15 of the report, relating to the Council’s finances.  This was the highest risk on Council’s Risk Register and reflected the pressures regarding future financial sustainability, as a result of a number of years of cuts in Local Government funding, followed by the uncertainty on ongoing funding in future years, made worse by the uncertainty caused by Covid-19 (not just for the current financial year but on medium term).

During discussion the following points were noted:

·         Members thanked Senior Leadership Team and officers for their work, commenting that the report was both interesting and informative.  The Covid-19 impact on various income streams had been mitigated by the Council’s hard work and its support to the community.

·         Members noted that budget monitoring was reported monthly at Senior Leadership Team meeting and to Cabinet every 3 months.

·         Members commented that it was unfortunate that funds had been saved in Environmental Maintenance and Economic Development as these were important and it revealed that the Council may be struggling to recruit to vacancies in these departments

·         Planned efficiency savings of £38k, held within Corporate Management Team was in respect of a structure review within the Communities Team.  This work did not take place due to the need for a high priority Covid-19 response to meet community needs, impacting on priority and capacity.

·         The Council’s Covid-19 response had been impressive and all 7 districts in Leicestershire had worked to support their residents.  This had highlighted the advantages of district councils, having the ability to make quick decisions.  Local decision-making was vital.

·         Mrs. Garton would clarify the income shortfall within Place Portfolio – Car Parks, detailed at paragraph 5.4 of the report and in Appendix A.

Edd de Coverly, Chief Executive thanked officers for their work and Members for their support.  The challenge on the Council’s finances should not be underestimated.  Much work had been undertaken by the Council and this was not without compromise.  The Council would continue to lobby Government for further funding to mitigate the loss of income and would maintain a vigorous focus on this.

Cabinet NOTED the year end forecast and financial position for the General Fund and Special Expenses at 30th June 2019.

Reason for the decision

The Council, having set an agreed budget at the start of the financial year needs to ensure that the delivery of this budget is achieved.  Consequently, there is a requirement to regularly monitor progress so that corrective action can be taken when required, which is enhanced with the regular reporting of the financial position.