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Agenda item
Quarter 2 Budget Monitoring Report 2021-22
Finance, Qualis Client and Economic Development (C-030-2021-22) – to review the quarter 2 budgetary position of the General Fund and Housing Revenue Account.
Decision:
1. The Cabinet noted the General Fund revenue position at the end of Quarter 2 (30th September 2021) for 2021/22, including actions being or proposed to improve the position, where significant variances had been identified;
2. The Cabinet noted the General Fund capital position at the end of Quarter 2 (30th September 2021) for 2021/22;
3. The Cabinet noted the Housing Revenue Account revenue position at the end of Quarter 2 (30th September 2021) for 2021/22, including actions proposed to ameliorate the position, where significant variances have been identified; and
4. The Cabinet noted the Housing Revenue Account capital position at the end of Quarter 2 (30th September 2021) for 2021/22.
Minutes:
The Finance, Qualis Client and Economic Development Portfolio Holder, Councillor J Philip introduced the Quarter 2 Budget Monitoring report. The report set out the 2021/22 General Fund and Housing Revenue Account positions, for both revenue and capital, as at 30th September 2021 (“Quarter 2”).
The report had also been considered by Stronger Council Select Committee on 16th November 2021.
In terms of General Fund revenue expenditure – at the Quarter 2 stage – a budget under spend of £0.129 million was forecast, with projected net expenditure of £16.682 million against an overall budget provision of £16.811 million.
The financial pressures due to the impact of the Covid-19 pandemic had generally stabilised, with the Leisure Facilities budget especially now back on track (albeit based on lower income expectations) as leisure centre usage recovered more sharply than expected. Similarly, Car Park usage was now back to around 80% of pre-pandemic levels, although the budget was off track.
The temporary delay in asset disposals to Qualis – as part of the Regeneration element of the initiative – was also causing some financial pressure in areas such as Building Costs and (Qualis) Interest Receivable, although the disposal had subsequently taken place on 20th October 2021, so the financial pressure would not get any worse.
Paragraph 2.3 of the report summarised a range of other budget pressures. However, despite the pressure, a projected surplus on Financing and Recharges was expected to help deliver a small budget surplus.
As with 2020/21, the Housing Revenue Account position was less affected by the Covid-19 pandemic. However, a range of other financial pressures – as presented in Paragraph 3.2 of the report – were combining to result in a projected year-end deficit of £1.403 million. The largest spending pressure relates to Housing Repairs (£560,000), which had been a challenge for the Council in recent years. However, the recently established delivery arrangements through Qualis were expected to deliver significant savings in the medium term.
Decision:
1. The Cabinet noted the General Fund revenue position at the end of Quarter 2 (30th September 2021) for 2021/22, including actions being or proposed to improve the position, where significant variances had been identified;
2. The Cabinet noted the General Fund capital position at the end of Quarter 2 (30th September 2021) for 2021/22;
3. The Cabinet noted the Housing Revenue Account revenue position at the end of Quarter 2 (30th September 2021) for 2021/22, including actions proposed to ameliorate the position, where significant variances have been identified; and
4. The Cabinet noted the Housing Revenue Account capital position at the end of Quarter 2 (30th September 2021) for 2021/22.
Reason for Decision:
This report facilitates the monitoring of the Council’s financial position for 2021/22.
In terms of General Fund revenue, it was a stabilising picture following the turbulence experienced in 2020/21 (and during Quarter 1 this year) due to the Covid-19 pandemic. However, there were still some spending pressures and it was essential that the Council avoids overspending due to a relatively limited contingency balance in the General Fund Reserve.
There were some significant spending pressures on the HRA revenue budget, including ongoing issues with Housing Repairs, which had been a challenging budget area in recent years.
Capital spending had been relatively limited in both the General Fund and HRA in the first half of the year.
The Stronger Council Select Committee asked a number of questions, which were contained in the minutes, but made no comments for Cabinet to consider. The Portfolio Holder was in attendance to hear the discussion.
Other Options:
There were no matters for decision in this report. The Cabinet is asked to note the contents but may choose to take further action depending on the matters reported.
Supporting documents: