A report to present to the Committee the Council’s Statement of Accounts for the financial year 2020/21 including the revenue and capital expenditure outturn position.
The Committee gave consideration to a report which presented the 2020/21 Annual Statement of Accounts including the revenue and capital expenditure outturn position.
The Committee was informed that the overall revenue outturn position for 2020/21 was at a positive variance of £2.153m and would be credited to the General Fund balance, contributing to the Council’s financial resilience in future years. The deadline for the preparation of the 2019/20 Accounts had been extended due to the pandemic and had again been revised for 2020/21. Due to the multi-year impact of COVID-19, the deadline for the 2021/22 financial year had also been changed. The publication date for the final audited accounts for 2020/21 had been adjusted from 31st July 2021 to 30th September 2021 and the 2021/22 accounts would need to be published on 30th September 2022.
The Committee was advised that the Statement of Accounts had been considered at the Audit Committee on the 29th July 2021 where they were expected to be approved. However, although substantially completed, the audit work had not been finalised. It was agreed that delegation of the final approval of the Council’s Statement of Accounts, once there had been a resolution to the outstanding matters, would go to the Vice Chair of the Audit Committee having regard to the advice of the Director of Finance and the External Auditor.
The Committee were provided with the breakdown of the year end positions for each portfolio which were as followed:
· People and Place Portfolio - there was a deficit of £4.456m against a revised budget of £87.923m. the adverse variance was mostly in the Economic Development service relating to the loss of income as a result of the COVID-19 pandemic. The final outturn of £4.456m was an improvement of £0.472m compared to the projected deficit of £4.928m at month 9 (31 December 2020). The reduced variance was due to the economic impact of the third lockdown being less severe than had been anticipated.
· Community Health and Adult Social Care Portfolio - had a favourable outturn of £1.657m which represented an improvement of £3.245m compared to the forecast pressure of £1.588m reported at month 9. The variance movement was attributed to the cost of care provision being below expectations due to more financial support from the NHS funded Hospital Discharge Scheme and the additional contributions by the CCG to the cost of care.
· Children’s Services Portfolio - as a whole recorded an overspend of £8.059m against a revised budget of £81.706m. The majority of the adverse variance (£7.784m) was within Children’s Social Care, primarily due to the cost of placements; out of borough in particular, and also additional staffing costs, mainly agency to address demand pressures arising from the pandemic. The adverse variance within Education, Skills and Early Years was £0.345m; the main drivers being the cost of SEND provision (including out of borough placements) and staffing costs. Preventative services recorded an underspend of £0.070m.
· Communities and Reform Portfolio - seen an adverse variance of £0.367m, an improvement of £1.663m compared to the forecast adverse variance of £2.030m estimated at month 9. The overall adverse variance for Communities and Reform Portfolio was due to a number of COVID-19 pressures, the reduction of income for the Music Service, Outdoor Education, Sports Development, and pressures within the Leisure Services contract. These pressures were partially mitigated by the reduction in service provision by the Heritage, Libraries and Arts and Public Health teams for expenditure such as delivery of services in primary care and also by vacancies across the Portfolio.
· Commissioning Portfolio - had an adverse variance of £0.492m as a result of the use of external contractors by the Procurement Service and the Governments guidance in response to COVID-19 which encouraged immediate payment terms for all contracted services removed any benefit from an early payment scheme. Government guidance was also given on limiting debt recovery activities during the first half of 2020/21. The pressures were partially offset by vacancies within the Finance Division and reductions in non-pay costs.
· Chief Executive portfolio - seen favourable outturn position of £0.256m represents a £0.030m reduction compared with month 9 of £0.286m. The Directorate was impacted by COVID-19 in respect of income generation for the Registrars Service, land charges and the recovery of court costs in 2020/21. However, these pressures were mitigated by a reduction in costs such as the postponement of the local election in May 2020, fewer civic functions, reduced costs for the Coroners Services and vacancies within the Legal Services team.
· Capital, Treasury and Technical Accounting Portfolio - had a deficit of £15.244m due the impact of the pandemic on anticipated interest, dividend income and capital financing transactions including a shortfall in capital receipts to fund the £3.750m of expenditure to be financed using the flexibility allowed by the Government.
· Corporate and Democratic Core Portfolio and the Parish Precepts and Grants Portfolio both reported no variance to their 2020/21 budgets.
The Committee was informed of the following:
· The level of Government grants received in relation to the COVID-19 Pandemic;
· Schools balances at 31 March 2021 of £9.306m;
· The Dedicated Schools Grant (DSG) deficit was £3.560m which is now held in an unusable reserve rather than being netted off the Schools balances (as presented in the accounts in previous years);
· The final Housing Revenue Account (HRA) balance was £21.370m;
· The balance on the Collection Fund was a deficit of £27.213m;
· The revenue account earmarked reserves at £113.512m, other earmarked reserves at £29.452m (Revenue Grant Reserves of £20.145m plus School Balances as above) and an increase in the General Fund balance of £2.153m to £17.263m, reflective of the revenue outturn position;
· Expenditure on the Council’s Capital Programme for 2020/21 was £73.227mwhich is an increase on the month 9 forecast expenditure of £71.012m. The increase in expenditure required funding allocated to future years to be re-profiled to fully finance the Capital Programme in 2020/21;
· The significant items in each of the primary financial statements;
· The preparation of Group Accounts incorporating the Councils two wholly owned companies – the Unity Partnership Ltd. and MioCare Community Interest Company; and
· The Annual Governance Statement.
The Committee was advised that as of publication of the report almost every matter that could be addressed by the Council had been concluded. The issue in relation to the audit of the GMPF was beyond the control or influence of the Council and it remained with the External Auditor to finalise the position. Until this was fully concluded, the Council’s accounts could not be approved. It was anticipated that the audit would be completed before the next Audit Committee on 9 September 2021.
RESOLVED that the report be noted.