2019-20 Full Year financial Performance
- Meeting of Cabinet - This meeting will be streamed live. The link can be found on the Agenda frontsheet and the Reports Pack below, Cabinet, Monday, 13th July, 2020 9.30 am (Item 45/20)
- View the background to item 45/20
Report by Councillor Philip Cowen, Executive Member for Finance & Growth.
The Executive Member for Finance and Growth presented the report that provided information on the Council’s actual full year financial position as at 31 March 2020.
He thanked the Finance team for the work put in to deliver the report, especially during the period between March to the end of June where Officers had been redeployed to support the businesses of Breckland.
The Executive Member highlighted whilst the Council had an overspend of £224k, it was in a fortunate position to be able to use reserves to mitigate some of those costs which were explained in the report.
The report explained that due to the high overspend, the gain from the National Non-Domestic Rates (NNDR) pilot of £559k had been utilised to cover that overspend, and therefore due to the scale of the figure it would have to go to Full Council to be approved.
Whilst the Council had a reserve fund of just under £7m that was unallocated, the Council’s general fund was already at the minimum of £2,500k which he did not want to see drop below that figure.
The actual Capital out-turn showed a spend of 71% against budget which meant the Council had not used all the capital that had been set aside in the financial year to deal with various programmes and projects that were ongoing.
The Executive Member for Contracts and Assets said it was a delicate balancing act, and within his portfolio economic growth would allow the businesses within Breckland to thrive as the country started to emerge out of the COVID19 crisis. At the same time COVID19 has had a global impact and the District would not be immune to that impact. He was in agreement with the recommendations and believed it was the correct approach for the Council to follow.
Councillor Birt considered the significant variances and highlighted the Legal Services overspend and was concerned that there were issues with commercial property and asked how, as a Member, he could understand the detail of that overspend and what the issues were, as there could be scrutiny issues to consider.
In addition, in respect of the capital that had not been spent, he noted that the report was dated to 31 March, and therefore the COVID19 crisis did not apply and he was concerned that if the Council was not spending capital that had been allocated during normal times what would happen in extra-ordinary times such as the Council found itself in now.
Councillor Jermy was concerned about the level of overspend and in particular the expenditure of the temporary housing accommodation. In addition, he raised apprehension that the new property currently being refurbished would do little to reduce costs as it would not be able to take the numbers that the Council would require. He went onto ask the Cabinet for their plans to address the increased housing costs, given that they were a significant amount.
The Executive Member for Finance and Growth responded to Councillor Birt that he too had also raised a question in respect of the Legal Services budget, and informed Members that it was not a service that could be clear about their costs at the beginning of the financial year. There had been some significant changes with regard to the commercial property deals that had required the support of Legal Services, of which the Executive Member for Contracts and Assets would be able to provide more detail if required. The Executive Member was keen to look at all the variances as it was important to understand what was happening within each service area.
In terms of the Capital spend, the Executive Member provided reassurance of the way in which the Council managed its finances. The capital projects were grant funded, and spending the funding required the assurance that the right contract was in place.
The Executive Director of Place advised that the level of demand for temporary housing accommodation was unprecedented and that had been reflected in the financial figures. During the pandemic there had been a nationwide instruction to house the rough sleepers within the District. There had also been a rise in emergency accommodation requirements and movements between registered providers were not allowed during the crisis which had resulted in a rise in the figures again. The property at Elm Road formed one important part of a more complicated solution. Numbers within other Local Authorities were similar and therefore a countywide response was being considered and Breckland were actively part of that. In addition, Breckland were actively working with Saffron Housing and Flagship to match voids within the system and having looked at the figures there was resource to house some of those within temporary accommodation.
Councillor Atterwill asked the Executive Member for Finance and Growth for clarity on the Development Control costs highlighted within the appendices of the report, that referred to a loss of a court case. He went onto ask the Executive Member for Planning to provide in writing a summary of what that court case was. The Executive Member for Finance and Growth confirmed that the court case costs were approximately £35,000 of the £72,431costs highlighted.
1) That the report and appendices be noted and recommend to Full Council
· That capital budgets (& associated funding sources) of £2,194,668 be carried forward into 2020-21 to support projects in progress.
· That the final capital out-turn and funding for 2019-20 as detailed in appendix B be approved.
· That the revised capital budget and associated funding for the 2020-21 capital programme as detailed in appendix C be approved.
· That the NNDR Pilot gain is utilised to cover the over spend and that £214,489 is contributed from the Organisational Development Reserve and a further contribution is made from the Revenues and Benefits Reserve to cover the remaining over spend.
2) That the report and appendices be noted and changes are made to the recommendations to Full Council.
Reasons for Recommendation
To provide timely information to Members on the overall financial position of the Council, enabling resource re-allocation to priorities where necessary and protecting the General fund balance.
To enable approved capital projects to continue to deliver in the new financial year.
RESOLVED that the report and appendix be noted; and
CABINET Recommend to FULL COUNCIL:
1) That capital budgets (& associated funding sources) of £2,194,668 be carried forward into 2020-21 to support projects in progress.
2) That the final capital out-turn and funding for 2019-20 as detailed in appendix B be approved.
3) That the revised capital budget and associated funding for the 2020-21 capital programme as detailed in appendix C be approved.
4) That the NNDR Pilot gain is utilised to cover the over spend and that £214,489 is contributed from the Organisational Development Reserve and a further contribution is made from the Revenues and Benefits Reserve to cover the remaining over spend.
- 2019-20 Full Year financial Performance, item 45/20 PDF 75 KB
- Appendix 1 for 2019-20 Full Year financial Performance, item 45/20 PDF 115 KB
- Appendix 2 for 2019-20 Full Year financial Performance, item 45/20 PDF 83 KB