Issue - meetings

The Cabinet considered a report of the Director of Finance (Chief Financial Officer) that was prepared in accordance with the requirement of Section 25 of the Local Government Act 2003 to report on the robustness of the estimates made for the purposes of the budget calculations and the adequacy of the proposed reserves.

The level of general balances to support the budget and an appropriate level of earmarked reserves maintained by the Council in accordance with the agreed Council policy on earmarked reserves was an integral part of its continued financial resilience supporting the stability of the Council.

The report also included the Director of Finance’s consideration of the affordability and prudence of capital investment proposals.

It was reported that Members could be assured that the Council continued to be well placed to meet the challenging financial future facing Local Authorities and that the Council was preparing a detailed revenue budget within a five year Medium Term Financial Strategy (MTFS), a five year capital programme and the continuation of the early closure of accounts. This allowed early focus on the coming challenges and a robust financial transformation programme.

The financial resilience depended in part on the Council maintaining an adequate level of reserves which were set out in the report. The Audit Committee at its meeting in July 2018 considered the policy on earmarked reserves and it was proposed to action the same review after the closure of accounts for 2018/19.

Options/Alternatives considered

The Cabinet could comment on the recommendations of the report however Members had a statutory duty to have regard to the Chief Financial Officer’s report on the robustness of the estimates and the adequacy of the proposed financial reserves when making decisions.

The robustness of the estimates and reserves were satisfactory, however this was only the case provided the action necessary were taken to ensure the balances were set at the level recommended, that all budget options or in year alternatives were delivered as planned and monitored.

RESOLVED – That:

1. The General Balances currently calculated for 2019/20 at £14.250m be approved. Any Excess funding in general balances at the financial year end would be transferred to the financial mitigations reserves to support future budgets.
2. The initial estimate of General Balances to support the 2020/21 Medium Term Financial Strategy and the 2021/22, 2022/23 and 2023/24 Medium Term Financial Strategy were £14.814m and £14.134 respectively.
3. Submission of the intended report to the Audit Committee to ensure the Council reserves were subject to appropriate scrutiny, be noted.
4. The actions necessary to secure a properly balanced budget as presented in paragraph 3.6of the report be approved.
5. The actions necessary to ensure the prudence of the capital investments as presented in paragraph 4.4 of the report be approved.
6. The report be commended to Council for approval