Agenda item

The Head of Strategic Finance and Property presented the General Fund Revenue and Capital Outturn report. The key points for Members to note were:

·        The Revenue Outturn was close to budget, with an underspend of £16,000, which would be taken into the General Reserve.

·        There was an underspend of £30.91m in the Capital Outturn due to the delay of several projects.
 

·        In the Net Cost of Services, there was an underspend of £33,000.

·        In the corporate budgets, the interest and investment fund delivered an additional £149,000 on top of the projected amount, due to the performance of the Property Fund. This would be added to the General Reserve to offset poor performance elsewhere; the COVID-19 pandemic had suppressed interest rates and there were difficulties in obtaining rent from some tenants. However, the property funds’ investments were spread over a diverse range of investments.

·        There was a transfer of £2.555m to the Collection Fund Reserve. Roughly £1.824m of this amount had been from Section 31 income. £731,000 had been taken from the Council’s participation in the Business Rates Retention Pilot in Hertfordshire.

·        In relation to the Capital Outturn, there was a spending programme of £41.672m, of which only £10.762m had been  spent, leaving £30.898m to carry forward. Progress was now being made in relation to projects such as Northgate End Car Park and Grange Paddocks Leisure Centre, which would mean that these funds should be used throughout the financial year.

Councillor Corpe said that some content of this report had been considered at the Executive meeting on 7 July 2020 and asked whether it would be more appropriate for the Committee to have seen this report before the Executive. He said that it was positive to see that the Council had an underspend and that he hoped it could be diverted to services that had previously faced cuts. He asked what would be done with the underspend.

The Head of Strategic Finance and Property said the normal process would be that the Committee would consider this report prior to the Executive. However, due to COVID-19 pandemic, the Executive had asked for financial data to be presented to it as soon as it was available. He explained that normally it would be preferable for the schedule of meetings to be altered to allow this Committee to see this data first.

The Head of Strategic Finance and Property said that funds would be added to the General Reserve, which could be spent on projects as Members saw fit. It was within the remit of the Committee to make a recommendation to the Executive over the use of these funds.

The Chairman said that whilst there was an underspend, this was net of a use of £750,000 of reserves, which was not planned for at the beginning of the year. This demonstrated that it was prudent to transfer underspends to the General Reserve for unforeseen circumstances. For example, the biggest use of reserves was seen in the New Homes Bonus Priority Spend reserve.

The Head of Strategic Finance and Property confirmed this was the case and that throughout the year authority needed to be obtained to use reserves. He confirmed that use of the New Homes Bonus priority spend reserve was most common throughout the year.

Councillor Corpe said that perhaps it would be helpful if it was highlighted more prominently in the accounts where spending had been subsidised by funds from various reserves.

The Chairman mentioned the accumulation of funds in the Flexible Homelessness Grant. He asked what this would be used for, as it did not appear to have been used throughout the year. He referred to unused funds in areas such as Discretionary Disabled Facilities, Decent Homes Grants and the Launch Pad 2 facility in Ware, and sought assurance that the Council was looking for opportunities to use these funds on the correct projects.

Alison Street, Finance Business Partner, said the Flexible Homelessness Grant was funding from Central Government to combat homelessness and any excess did not need to be paid back, so was transferred to a reserve for use in later years. Around £250,000 had been received this year and about half of this had been spent. Officers were looking for opportunities to promote these grants.

It was moved by Councillor Stowe and seconded by Councillor Fernando that the recommendations, as detailed, be approved.  After being put to the meeting and a vote taken, the motion was declared CARRIED.

RESOLVED – that (A) the Committee  approve the transfer of the General Fund revenue outturn of £16k under spend to the General Reserve; and

(B) the Committee approve capital budgets of £30.898m be carried forward to 2020/21 to fund ongoing capital schemes.