Agenda item

The Portfolio Holder for Corporate Governance, 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 2021.

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

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 2021.

Mrs. Garton advised that the forecast on General Expenses was an underspend of approximately £120k at Quarter 1.  She updated Members that additional information showed that a slightly reduced underspend was anticipated.  This took into account any ongoing financial implications of Covid-19, the specific Covid contingency budget (set up as part of the budget) and the additional carry forward which Members had approved from last year’s underspend (providing additional support for the ongoing impact of Covid-19).  The Covid-19 position and financial impact was detailed at paragraph 9.1 of the report and showed a net impact in year of £108k to date, after taking into account specific income compensation grants.

Mrs. Garton highlighted that there were a number of non Covid-19 underspends and overspends forecast for the year.  Those over £10k were detailed within the report but the main area of non Covid-19 impact related to the latest pay offer, which was not budgeted for based on government guidance.  This added a further £80k of expenditure and was taken into account with the forecast of £120k underspend.

Mrs. Garton confirmed that a small overspend was forecasted for Special Expenses, which had increased slightly when taking into account Quarter 4.  The capital expenditure forecasts were broadly in line with the budget, with a number of key projects already underway or being procured.  There were 2 log-term projects where there was likely to be some delay into later years (disabled facility grants and the asset development programme).

The Leader advised that when setting the budget, the Council had anticipated 2021/22 being a challenging financial year.  It had prepared for this by setting aside a Covid-19 contingency by carrying forward some unspent budget from the last financial year.  This had proved to be the right approach and despite Covid-19 continuing to affect the Council financially, there remained some flexibility to meet any further unforeseen costs for the rest of the financial year.

However, it was important to not become complacent.  There would be further challenges ahead as the budget setting process for the next financial year was undertaken. 

The Leader highlighted that the Council had a modest Capital Programme within the General Fund and commented that he was pleased with the progress made to date on the delivery of these schemes, alongside other pressures the Council faced.

During discussion the following points were noted:

·         Members thanked officers for their work to ensure a balanced budged during this challenging time.

·         While the Council’s incomes decreased, it continued to spend on services for the community, such as housing and homelessness, which continued to areas of priority.

·         It was disappointing to see an overspend on homelessness.  It was suggested that the Council consider ways to reduce homelessness costs to the taxpayer.

·         It was important to note that windfall projects (such as Lake Terrace) would offer additional capacity to help house those who may be at risk of becoming homeless.

·         It was positive that income from the Cattle Market had exceeded budget expectations by £35k.  Cattle Market activity was progressing with increasing success and was an important source of income to the Council.  

·         The Council had supported households and businesses during the last 18 months and needed to continue to do so over the coming period of the recovery.

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

Reason for Recommendations

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.