Issue - meetings

Recommendations on page 25

RESOLVED that Executive notes

1)   the monitoring position of the General Fund at the end of the second quarter  detailed in Appendix 1 to the report (A net favourable variance of £0.413m against the profiled budget) 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 second quarter (Appendices 3, 4 and 5 to the report).

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

General Fund

A breakdown of the Quarter 2 monitoring position by Directorate was included in the report. The overall position on the General Fund at the end of Quarter 2 showed that there was a favourable variance of £0.413m. However, this included the S106 under spent expenditure; the position without these is £0.195m under achieved. The figures in this report had not yet been adjusted for the financial effect of Coronavirus. Extra expenditure incurred was to be covered by the Government grant and irrecoverable losses of fees and charges will be compensated in part, by the Ministry of Housing, Communities and Local Government (MHCLG) income compensation scheme. Further assessment of lost income would be undertaken as part of the revised budget process.

It was noted in respect of the Medium Term Financial Plan, that from 2021/22 onwards, there was a transfer into the general fund from the NNDR Growth Protection Reserve to replace the losses caused by changes in Government funding. As this was not a sustainable source of income for the general fund, the Council looked to the new directorate for development to generate income.

Housing Revenue Account (HRA)

At the end of Quarter 2, the HRA income figures showed an adverse variance of £0.192m. Expenditure showed an overall favourable variance of £0.400m. Overall the HRA showed a net surplus of £0.188m. 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 second quarter.  All of the HRA Budgets were to be reviewed as part of the revised budget process.

Capital Programme

In headline terms, the Capital Programme profiled budget for Quarter 2 was £8.701m and the actual spend and known commitments totalled £4.424m, which was £4.277m behind the planned spend position.

Whilst there were no significant financial issues to report regarding capital expenditure at the end of the second quarter, it was noted that the delivery of the approved Capital Programme was behind the profiled position as at Quarter 2, in part due to Coronavirus related delays. There were concerns regarding the spending of the 1-4-1 capital receipts. Officers continued to monitor the situation closely and would keep MHCLG updated. 

Treasury Management

The Treasury Management activity undertaken in the second quarter of 2020/21 was in line with the plans agreed as part of the Treasury Management Strategy 2019-2023. The income received from investments was higher than budgeted, however, interest rates being received on investments was generally lower than estimated. A full assessment of this was to be carried out as part of the revised budgets process.

Executive thanked the Portfolio Holder – Finance and Community Safety for the report  ...  view the full minutes text for item 50