Agenda item

Consideration was given to a report of the Director of Finance which provided the Cabinet with an update on the Council’s 2020/21 forecast revenue budget position at Annex 1 of the report and the financial position of the capital programme as at 30 June 2020 (Quarter 1) together with the revised capital programme 2020/25, as outlined in section two of the report at Annex 2.

Revenue Position

The current forecast outturn position for 2020/21 was a projected deficit variance of £21.299m after allowing for approved and pending transfers to and from reserves.

The position also included additional costs and pressures that have been identified by the Authority in this financial year as a direct result of the Governments lockdown arrangements to mitigate the spread of COVID-19 commencing on 23 March 2020. The additional pressures included forecasts of both income shortfalls and additional expenditure that have impacted on the Authority’s budgets as a result of the pandemic

The pandemic had affected nearly all aspects of Council service delivery; however, the most significant areas of concern were the People and Place, Children’s Services and Community Health & Adult Social Care Portfolios. Action was being taken and would continue for the remainder of the financial year to address variances and take mitigating action as detailed in the report.

The overall corporate position was partly being offset by the application of the £16.638m unringfenced Government COVID related grant funding received to date. In Appendix 1 to the report, the full Government grant was presented as a single sum so that it highlighted the level of variation across all Council budgets, given that there was insufficient resource to offset the adverse variance. However, this summary report presented the position after applying the Government grant across Portfolio areas. As further General Fund grant was expected in respect of lost income for sales, fees and charges, both the overall financial position and the application of Government grant would therefore change during the course of the financial year.

Capital Position

The report outlined the most up to date capital spending position for 2020/25 for approved schemes. The revised capital programme budget for 2020/21 was £143.711m at the close of Quarter 1, a net decrease of £3.921m from the original budget of £147.632m. Actual expenditure to 30 June 2020 was £18.214m (12.67% of the forecast outturn).

It was probable that the forecast position will continue to change before the year end with additional re-profiling into future years.

Option/alternatives

Option 1 - to approve the forecast revenue and capital positions presented in the report including proposed changes

Option 2 - to approve some of the forecasts and changes included in the report

Option 3 - not to approve any of the forecasts and changes included in the report

RESOLVED – That:

1. The forecast revenue outturn for 2020/21 at Quarter 1 being a £21.299m adverse variance having regard to the action being taken to manage expenditure be approved.
2. The forecast positions for both the Housing Revenue Account and Collection Fund be approved.
3. The use of reserves as detailed in Appendix 1 to Annex 1 to the report be approved.
4. The revised capital programme for 2020/2024 as at Quarter 1 be approved.