Revised budget 2020-21 (Agenda item 10)
- Meeting of Council, Thursday, 24th September, 2020 10.00 am (Item 67/20)
- View the background to item 67/20
Report of Councillor Phil Cowen, Executive Member for Finance & Growth.
Members are asked to note that this report has already been discussed at the Cabinet meeting on 7 September 2020 and has been recommended to Full Council for a decision.
Councillor Cowen, the Executive Member for Finance & Growth presented the report.
In these unprecedented times he doubted whether anyone could recall an instance when the Council had to consider a change to the budget part way through a fiscal year.
COVID 19 has had a significant impact on the workings and financial status of Councils throughout the United Kingdom and Breckland was no exception.
Earlier in the year, in June 2020, an interim report was presented on the likely and potential impact of COVID 19 on the budget that had been set prior to the outbreak.
The report now being considered contained two recommendations that were related directly to the impact of the pandemic and the likely cost effects having been drawn out of the Quarter One financial report that had been presented to the Cabinet meeting held earlier in the month on 7 September 2020.
Losses had been suffered through reductions in the Council’s income streams as shown in paragraph 1.3 of the report. The Council had also experienced additional costs as identified in paragraph 1.4 of the report. Government support had been targeted at some of the gaps the pandemic had created and whilst substantial, it had not fully funded the budget gap resulting from the impact of the pandemic.
However, Breckland Council through its prudent fiscal management had been able to absorb the majority of the financial gap by drawing down Reserves as shown in Appendix A of the report and the Council was confident that it should be able to put in place measures to address the £217k shortfall.
Furthermore, despite all the disruption, redeployment and change of working practices that staff had faced in the last 6 months, the Council Taxpayers of Breckland had been provided with an uninterrupted service. Bins had been emptied regularly, planning applications had been processed, communities had been supported and housing needs had been met.
Councillor Cowen thanked all the Teams within Breckland Council who had worked in challenging and often difficult circumstances to put this revised budget together. This had been a workstream that they had never encountered before and hopefully one which would not occur again.
Full details that supported the revised budget had been set out in the report and appendices.
The recommendations were then commended to Members for approval.
Councillor Bushell asked if the Executive Member could confirm whether the Council could still deliver its growth agenda, having regard to the drain on finances as result of the Covid 19 outbreak had placed on the budget. She also thanked the Officers who had worked diligently throughout.
In response, Councillor Cowen advised that the report highlighted the significant sums that had to be drawn down from the Council’s Reserves in order to bridge the gap. He drew attention to section 1.6 of the report that stated very clearly the great deal of work the Council was currently engaged in such as the HIF project in Thetford, the Snetterton power project as well as many others some of which were externally funded, but all would enable growth in the District and have an effect on many people and businesses as a result. Government plans in respect of the Autumn budget had been paused and news was anxiously awaited. One could only assume that there would be more assistance for businesses. The more businesses that survived this pandemic, together with the funding that Breckland Council put in place would help to enable the District to build back stronger. He did want to put Breckland Council in a strong and viable position moving forward and the budget proposal would leave the ‘head room’ to undertake that.
Councillor Birt recognised the position that the Council was in, but had every confidence that it would remain on top of its financial constraints. He mentioned the Council’s assets, and the impact of the reduction in value to the asset register and asked how this would be recorded and whether this would have an impact on the long-term income to this Council.
In response, Councillor Hewett, the Executive Member for Contracts & Assets referred Councillor Birt to Councillor Wickerson’s Question on Notice under agenda item 7 to which a response had been provided. However, the most recent asset valuation as of March 2020 had been reconfirmed in July as being at approximately the right level. All were very conscious of an uncertain future and accordingly the Councils assets were currently being monitored. It was working with all tenants, as any responsible landlord would, and rigorous processes were being applied whilst also taking into account that all tenants formed part of Breckland’s communities.
Councillor Jermy did not have any specific questions about the detail within the budget report but thanked Councillor Cowen for his presentation. At this time of the year the Executive Member and the Finance Team would be thinking about next year’s budget and he asked the Executive Member if any thought had been given as to how Members would be involved in this process taking into account the uncertainties and concerns surrounding this matter.
Councillor Cowen agreed that it was going to be a challenge in setting any future budgets but as far as Member involvement was concerned any suggestions and opportunities would be welcomed going forward. However, looking at the wider picture there were other aspects in putting the Council’s budget together such as the Worksmart 20:20 programme which would, in itself, have an impact on the Council’s costs. This particular year would be a challenge and would be somewhat different from those that had been experienced in the past for various reasons not least Covid.
Councillor Borrett felt that this was a very testing time for all concerned in local government finance but due to the decisions that Members had consistently taken over a number of years, Breckland Council had no borrowing, it had large amounts of Reserves and had used those Reserves to invest and generate income for the Council. He congratulated the Cabinet Member and supported the recommendations contained within the report.
Councillor Askew asked the Executive Member if he agreed with him that Covid-19 had proved the importance of maintaining healthy Reserves and he supported the recommendations.
Councillor Cowen advised that the majority of local Councils across the East Anglia region were no different to Breckland as all had been very good at maintaining their Reserves.
Councillor Morton thanked Councillor Cowen and the Finance Team for presenting a budget under very difficult times. He asked for clarification on two points about lost income, the first being the commercial services provision being 86% down on budget and asked if there was a possibility that this might be clawed back with any extra business as the Planning department had been experiencing. Also, in respect of investment interest, he had been surprised to note that it had gone down so much.
In terms of Planning, Councillor Cowen advised that planning applications had risen by 20% compared to this time last year and there was an expectation that the local economy was still growing in some areas As far as the commercial services provision and the 86% decrease, this had not been a surprise, but there had been enormous support from Government to enable those businesses to keep going and as a responsible landlord to its tenants the Council was doing all it could to ensure that its tenants remained in business. The Council’s assets were currently undergoing a major audit and the external auditors had provided assurance that these values were accurate. Regarding investments, part of that included Breckland Bridge and unfortunately a great deal of that work had not been as forthcoming as the Council would have liked due to the pandemic. However, the major scheme in Attleborough was still on-going and the dwellings were continually being sold and, consequently receipts from the loans were expected.
Members were informed that if any further detail was required on commercial services provision, Ralph Burton, the Strategic Property Manager in conjunction with Councillor Hewett would be able to provide this information.
After being proposed and seconded, and subject to one abstention, it was:
1) the additional revenue costs, funding and use of reserves as set out in Appendix A to the report be approved; and
2) the changes to the capital programme set out in Appendix B and Appendix C to the report be approved.
- Revised budget 2020-21, item 67/20 PDF 74 KB
- Appendix A for Revised budget 2020-21, item 67/20 PDF 39 KB
- Appendix B for Revised budget 2020-21, item 67/20 PDF 77 KB
- Appendix C for Revised budget 2020-21, item 67/20 PDF 47 KB