Agenda item

2020/21 Quarter 3 Budget Monitoring Report

A report that provides and update for Cabinet on the financial position of the Council for the period to December 2020.


Cabinet Portfolio Holder – Councillor Peter Butlin


Councillor Peter Butlin (Deputy Leader – Finance and Property) introduced the report summarising its key elements including underspends, reserves, the implications of academisation, capital slippage and the impact of the Pandemic on the Council’s ability to meet its savings targets.


Councillor Helen Adkins (Leader of the Labour Group) commented on the forced academisation of schools. Referencing Trinity School in Leamington Councillor Adkins acknowledged the need to mitigate for the £1m deficit at the school, Recognising that a total of £2.137m has been set aside she asked whether the remaining £1.137m would be used for schools in a similar situation. If so, she considered that it is unfortunate if the Council is having to compensate for shortfalls in funding from government. Cabinet was asked if it would not be better to provide more support for schools before they find themselves in financial difficulty. In response, Councillor Seccombe stated that the Council, whilst unable to provide direct financial support to schools in deficit does provide advice and other forms of support. Councillor Seccombe added that many secondary schools have elected to become academies as they can access more funding. However, all schools in Warwickshire, whether academies or not, are encouraged to be part of the County’s education “family”.


Concerning highways issues, Councillor Keith Kondakor observed that delegated budget projects are running late. The crossing project at Weddington Road, Nuneaton had been delayed and there was a need for resurfacing of the Old Hinckley Road. In reply, Councillor Jeff Clarke stated that a survey at Weddington Road had been delayed owing to the schools being on lockdown. The Old Hinckley Road would be surveyed soon. He assured Councillor Kondakor that the funding for the projects will be carried over into the next financial year adding that a new process for the administration of delegated budgets is in development.


Councillor Jerry Roodhouse (Leader of the Liberal Democrat Group) noted that if academy schools fail then it is the County Council that is required to intervene and address the matter. Referencing page 38 of the document pack the pressures of £1.658m on mental health were highlighted as were  pressures on domiciliary and residential care packages.


Councillor Dave Parsons (Deputy Leader of the Labour Group) noted that when a school becomes an academy all land and assets transfer from the Council to the academy. He asked that if an academy fails, is the land returned to the Council?


In closing Councillor Peter Butlin recognised that academisation is an emotive subject. He stated that the money set aside is for transference from the Council to an academy. If academies experience difficulties subsequently the Council cannot provide financial support. Regarding highways maintenance, this is not part of slippage. Maintenance happens throughout the year although much more can be done when the weather improves. The slippage identified in the report is on major projects. Not maintenance. The impact of Covid on mental health was recognised. Provision for this will be made in the budget for this.  




That Cabinet:


a)       Notes the forecast underspend of £9.271m for the 2020/21 financial year on the Council’s revenue budget, and the expected impact of an additional £11,526m will have on the Council’s un-ringfenced reserves.


b)       Notes there is a forecast shortfall in delivery of the 2020/21 savings requirement with a value of £2.581m.


c)       Notes the decreases to the approved 2020/21 capital programme of £29.378m since the programme was last reported in Quarter 2.


d)       Approves the carry forward of the reprofiled spend on the capital programme of £31.996m in 2020/21 into future years.


e)       Approves the request to create a new earmarked reserve to recognise the impact on WCC of funding school deficits resulting from forced academisation; as noted in paragraph 2.5.9.


f)        Acknowledges that at the date of writing this report, the national and local response to Covid-19 is an ever-charging landscape.  As such, it is important to note the inevitability of significant changes to the forecast position. This will be driven by changes to Covid-related income and expenditure pressures and also Covid funding changes.

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