Issue - meetings

Recommendations on page 22

RESOLVED – that Executive notes

1)   the monitoring position of the General Fund at the end of the first quarter as detailed on Appendix 1 to the report and the key issues highlighted within the report.

2)   the position on the Housing Revenue Account (HRA), the Capital Programme and Treasury Management at the end of the first quarter as detailed in Appendices 3, 4 and 5 to the report.

Executive considered the report of the Portfolio Holder - Finance and Community Safety which provided an update on the financial position of the Council following the first quarter’s budget monitoring exercise for the General Fund, the Housing Revenue Account (HRA), Capital Programme and Treasury Management activity.

General Fund

This is the first budget monitoring report to be presented in the new three Directorate format. 

The original budget for 2020/21 showed a funding deficit of £0.290m.  The current budget shows this had been reduced to £0.171m deficit after the Council tax increase and other small movements were included.

A breakdown of the Quarter 1 monitoring position by Directorate was included in the report. The overall position on the General Fund at the end of Quarter 1 showed that there was a favourable variance of £0.223m. However, this included the S106 under spent expenditure; the position without these was £0.069m under achieved.  As has been reported in the Leader’s updates, in April, May and June the Council lost leisure income totalling £0.412m which would not be recovered in 2020/21.  Planning income was also under achieved at this time. Performance in Quarter 2 would reveal how much other income had been lost on sundry debtor invoices and other miscellaneous income.

Executive were advised that the Fair Funding Review and reform of the business rates system had been delayed for a year. It was also anticipated, although not confirmed, that the Spending Review 2020 and reform to New Homes Bonus would also be postponed.

Housing Revenue Account (HRA)

At the end of Quarter 1, the HRA income figures showed an adverse variance of £0.552m. Expenditure showed an overall favourable variance of £0.534m. Overall the HRA showed a net deficit of £0.027m. In light of the expenditure patterns to date, there were no significant issues to report regarding the overall position for the HRA at the end of the first quarter.  In the second quarter a clearer indication could be given as to how much rent arrears have been affected by the financial impact of Coronavirus on Council tenants.

Capital Programme

In headline terms, the Capital Programme profiled budget for Quarter 1 was £3.179m and the actual spend and known commitments totalled £2.483m, which was £0.696m behind the planned spend position.

There were no significant financial issues to report regarding capital expenditure, however it was noted that the delivery of the approved Capital Programme was slightly behind the profiled position as at Quarter 1, in part due to Coronavirus related delays.

This was anticipated and caused concern regarding the spending of the 1-4-1 capital receipts that had a deadline to be spent by 30/9/20 or they had to be returned. This issue was highlighted to MHCLG in March and the Council had received notification of an extension to the deadline to 31/12/20.

Treasury Management

The Treasury Management activity undertaken in the first quarter of 2020/21 was in line with the plans agreed as part of the Treasury Management Strategy 2019-2023.  ...  view the full minutes text for item 32