Agenda item

The Committee received the reports of the Chief Finance Officer which asked Members to consider and comment on the financial information that covered Quarter 1 of 2020-21.

Officers explained that Covid-19 had substantially impacted the 2020-21 financial year. The Council had been reporting monthly to the Ministry of Housing, Communities and Local Government (MHCLG) and the Executive the estimated impacts on income streams and cost base, affecting both the General Fund and the HRA.

The Committee noted that at the end of Quarter 1, taking into account Covid-19 and other issues, current estimated full year revenue outturn estimates indicated deficits of £1,164k for the General Fund and £374k for the Housing Revenue Account.

Officers explained that General Fund planned savings were showing a forecast shortfall of £603k, whilst the Housing Revenue Account was forecasting savings to be £195k lower. Much of this related to staff capacity at the Council to deliver savings this year where Covid-19 had led to a requirement for additional resources to deal with backlogs, where otherwise savings would have been expected to be made. There had been delays to negotiations on the environmental contract negotiations plus Covid-19.

Members acknowledged that the capital programme was currently forecasting an underspend of (£9,329k); (£3,641k) General Fund and (£5,688k) Housing Revenue Account. In the General Fund, the majority related to loans to the Housing Trust and the purchase of land whilst the HRA variance was due to much lower expected spend on the housing development and property improvement programmes in this financial year.

The report set out that Programme for Growth projects continued, but progress in terms of financial spend had been mostly staff cost in quarter 1.

Officers confirmed that the MHCLG return submitted for July indicated an overall estimated gross impact on Council finances of £3,759k across both the General Fund and HRA.

Members asked a number of queries about the report in relation to the HRA deficit, the adaptations budget, budgetary underspends and reasons for these, and the retail and hospitality grants issued by the Council during lockdown.

Officers explained that there were three main sources of funding for the HRA, and that in relation to the receipt of rents this was doing relatively well but would be monitored on a monthly basis. Savings across a number of budgets were due to the lack of staff in the offices due to Covid-19. Officers confirmed that they would provide further information to Members on savings and housing adaptations after the meeting.

In relation to retail and hospitality grants, Members noted that during the first round of such grants the Council was given some flexibility in how it could spend any residual funds left. Some of the £40k that remained was being spent on late grant applications for funding, and no definitive response had yet been received from the government about whether it could be used to support businesses in other ways.

The Committee were also informed that a new support scheme had been announced that would provide a £!5,00 payment to businesses in case of a local lockdown; no specific guidance had yet been received on how these funds could be used, but Officers would consider it carefully when it was.

RESOLVED:

To note the Council’s financial results and budget exceptions in Quarter 1 in 2020-21.