Agenda item

The Select Committee were provided an update on the Council’s 2020/21 forecast revenue budget position and the financial position of the capital programme as at 30 September 2020 (Month 6) together with the Revised Capital Programme 2020/25.  The report had been included on the Cabinet Agenda on 30 November 2020.

The report enabled the Select Committee to continue its review of the financial position of the Council.  As well as the Forecast Revenue Position at Month 6, the report also presented the current forecast position for the Dedicated Schools Grant (DSG), Housing Revenue Account (HRA) and Collection Fund.

The COVID-19 related expenditure gap was shown as £4.250m and was a considerable reduction of £10.061m compared to the COVID-19 pressure of £14.311m reported at Month 5.  The reduction was largely as a result of additional funding of £8.928m received from the Government and now included the confirmed compensation for the lost income related to sales, fees and charges of £1.282m which was paid to the Authority on 27 November 2020.  The basis of the COVID-19 costs is the Round 6 (September) return that was submitted to the Ministry of Housing, Communities and Local Government (MHCLG) on 6 October 2020, at which point the financial challenge was estimated to be £12.388m.  This estimated financial position submitted to the MHCLG was prepared without the inclusion of any additional funding incorporated in the monitoring report. This was simply a timing issue.

Members were reminded that monthly returns were submitted to the MHCLG to assist the Government in assessing the financial pressures being faced by Local Government arising form the COVID-19 pandemic.  The Round 7 Return was subsequently submitted on 6 November 2020.  The report also provided an update on both ringfenced and un-ringfenced, mainstream and COVID specific grant funding.

Members asked for and received clarification on the following:

·         Was the recent lockdown included and was it expected to decline – monitoring was being undertaken on a monthly basis and the position did initially get worse with the new lockdown but the position is constantly changing. This will be outlined in future reports. The significant issue would be the COVID legacy funding going forward. Government Grant Funding would be used to support for 2020/21 but the impact for 2021/22 is unclear.

·         Were checks being made on business grant applications – a number of checks are undertaken (in line with Government guidance) before the paymet of usiness grants to ensure that any instances of fraud are minimised. There had been a significant increase in the number of applications due to the current situation and the availability of new rounds of grant.

·         Were the reserves used for specific initiatives – A range of reserves have been used in year to support specific initiatives that are deemed corporate priorities. The most significant reserve used relates to a Central Government grant to support the response to COVID-19. This was paid in advance in the previous financial year and carried forward, thus increasing the vale of the use of reserves in year.

·         Multiple payments to businesses in the same property - The grant payable is based on whether a business is registered for business rates and the rateable value of the business. Therefore, if businesses are registered and pay Business Rates separately then multiple businesses in the same property could apply for separate grants.

RESOLVED that:

1.         The Finance Update – Revenue Monitor and Capital Investment Programme 2020/21 at Month 6 be noted.

2.         A further updated be provided at the next meeting of the Select Committee.