The purpose of the report is to provide an analysis of the financial position of the organisation at 31 March 2021.
Cabinet Portfolio Holder: Councillor Peter Butlin
Councillor Peter Butlin (Deputy Leader, Finance and Property) introduced the report by stating that it was a story of Covid. Some council services had increased and some had decreased. In some instances officers had been very cautious on expenditure. Financial support linked to the Pandemic had been provided by the government and this was appreciated. Nevertheless, the short timescales for using this money had meant that it had not been possible to utilise it all. This had resulted in a significant underspend. If factors around the Pandemic are removed from the equation, an underspend of just short of £6m was being reported. This is within the threshold previously set.
Cabinet was informed that some areas, including SEND have seen an overspend of their budget. This has been exacerbated by the Covid crisis and costs increasing significantly.
On the capital side the Pandemic has had an impact on projects. Contractors have been affected and the cost of materials has increased. This has all resulted in a degree of slippage.
Councillor Peter Butlin concluded by noting that looking to the future there remain some unknowns. For example, will an increase in older people entering the social care system make pressures more acute? Will the system be able to cope with an expected increase in mental health issues?
Councillor Jerry Roodhouse informed the meeting that the government is alleging that Covid support money is being locked up by local authorities and not used as it should be. He suggested that business could benefit from those resources as part of the recovery of the economy.
In reply Councillor Izzi Seccombe reminded Cabinet that early during the Pandemic the County Council had responded rapidly, offering support to local businesses and making short term loans available to district and borough councils to enable them to support the economy.
In closing Councillor Peter Butlin agreed that financial resources should not be hoarded and repeated the need to support businesses going forward.
a) Notes the net spend in 2020/21 and the consequent revenue underspend for the organisation at the end of the year;
b) Notes the explanations and mitigating actions for variations to budgets, and the implications on the Medium-Term Financial Strategy, as set out in Appendix A;
c) Notes the capital spend in 2020/21 and its financing and the explanations for variations on individual projects set out in paragraph 5.6 and Appendix B.
d) Approves the £6.221m carry forward of specific services’ revenue budget from 2020/21, to support the delivery of the Council Plan in 2021/22, as outlined in paragraph 4.4 and Appendix D;
e) Approves the reprofiling of the capital programme as set out in Annexes A to M and require Corporate Board to give an enhanced focus to the accurate phasing of capital spend in 2021/22 and over the medium term;
f) Notes the current reserves position for the organisation as set out Section 4 and Appendix N.