Issue - meetings

Cabinet considered the General Fund and HRA Provisional Outturn report for 2020/21 and Members were advised that these were likely to be the final accounts for the year, subject to any last-minute amendments, or changes as a result of the external audit. On the General Fund revenue position, there was a £3.6million overspend. This compared favourably with the last monitoring report, in January. Some of the overspend was due to the impact of Covid, as a range of additional expenditure was incurred, and income had fallen. Almost all income had been affected, especially off-street car parking, Council Tax and Business Rates.

However there were also non-Covid factors that gave rise to the overspend. The two largest were the actual and potential legal costs associated with matters being considered by the Investigations and Disciplinary Committee, estimated at £733,000; and the revenue costs of the replacement of berth 4/5, estimated at £445,000. Additionally, the council had some pre-existing budget problems that would not have gone away. These were referred to in the 2021-22 budget monitoring report, which was also considered at this meeting. These would also be a factor to consider in the 2022-23 budget.

The accounting arrangements for Council Tax and Business Rates were exceptionally complex for 2020-21. For example, Business Rate Relief was subject to a Government grant that had to be included in the 2020-21 accounts, but the council would have to apply the entire grant in subsequent years. These technicalities meant that about £10million of the council’s reserves at 31 March 2021 were already committed, to be used to fund income losses. All districts would have a similarly inflated reserves position at 31 March 2021, which should not be considered to be available to spend on anything other than Council Tax and Business Rates.

The meeting were further advised that the overall position of the Housing Revenue Account was better than previously forecast. This was mostly due to rent income not being so adversely impacted by Covid than planned. On the capital programmes for both the General Fund and HRA, they were roughly 50% underspent. This was largely due to Covid, although there were some projects that would have underspent, not as a result of the pandemic.

Councillor Saunders proposed, Councillor Bob Bayford seconded and Cabinet agreed the following:

1. To note the following:

a.  The provisional outturn position for the General Fund;

b.  The provisional outturn position for General Fund Capital;

c.  The provisional outturn position for the Housing Revenue Account;

d.  The provisional outturn position for Housing Revenue Account Capital;

2. Cabinet further agreed the following:

a.  The reserve movements as identified at section 5 table 3 to the Cabinet report;

b.  The slippage in the General Fund Capital Programme as identified in section 6 to the Cabinet report;

c.  The slippage in HRA budgets as identified in section 6/7 to the report.