Agenda item

The Section 151 Officer presented a report to update Budget Scrutiny Committee 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.

Members had no questions relating to the content of the report.

The Section 151 Officer gave Members an update on how the Council’s financial position had been changed in light of the ongoing Coronavirus pandemic. She explained how information was being provided from the Council to the Government on a regular basis, such as:

1) Weekly updates on grants paid and reliefs allocated to businesses

2) Monthly updates on a return of expenditure and income losses, reserve levels, reliefs through Council Tax, and levels of cash being received for Business Rates and Council Tax

3) Monthly updates on a return on the assurance checks done on grants the Council has paid out to prevent fraud and ensure they meet Government guidelines

The Section 151 Officer explained that the return of expenditure and income for the current month was being prepared, and the figures within it for the whole of the pandemic so far were:

1) Expenditure – approximately £200,000 extra to what was budgeted (spent on ICT equipment for officers to work from home, PPE and staff overtime to get grants paid out)

2) Income lost – approximately £390,000 (primarily leisure facilities not being allowed to open)

3) Delays in income – approximately  £162,000 (Planning, land charges and MOTs)

4) Total possible loss for the year – £1.5m

The Section 151 Officer explained that the Government had given three grants to the Council in an effort to mitigate these losses, and a future scheme was planned by the Government to address missed income from fees and charges. The scheme would involve the Council covering 5% of the losses, then the Government and the Council covering the other 95% by the Government paying 75p in every £1.

Members were also given an update on Business Rates and Council Tax by the Section 151 Officer. The Council was being asked by the Government to provide figures on cash received from both areas monthly, and the Council’s latest projections for both until the end of the financial year would be £3.350m lost in Business Rates and £1.702m lost in Council Tax. The Government were setting up a scheme to allow the Council to put off these collection fund deficits for three years.

The Portfolio Holder for Finance & Resources added to this by explaining that the previous financial year had put the Council in a strong position to deal with the pandemic.

The Chair invited Members to ask questions or make comments on the information provided by the Section 151 Officer.

Councillor Natalie Hoy believed the Council had been very good at releasing money to businesses in the midst of the pandemic.

Councillor David Dixon asked if any estimates had been made on how much could be lost in Business Rates over the possible three year period offered by the Government. The Section 151 Officer explained that it was very difficult to make a projection at this moment in time because the recovery of business rates payments had only just started.

The Chair thanked the Section 151 Officer for the report and the update, and brought attention to the two recommendations in the report to note the monitoring position as detailed in the report, and to note the position on the HRA, Capital Programme and Treasury Management at the end of the first quarter.

The recommendations in the report were moved by Councillor Jen Wilson and seconded by Councillor Ray Heffer.

RESOLVED that the Budget Scrutiny Committee:

(i) Notes the monitoring position of the General Fund at the end of the first quarter as detailed on Appendix 1 (A net favourable variance of £0.223m against the profiled budget) and the key issues highlighted within this report.

(ii) Notes the position on the Housing Revenue Account (HRA), the Capital Programme and Treasury Management at the end of the first quarter (Appendices 3, 4, 5 and 6).

(Section 151 Officer)