Issue - meetings

This report provides details of the final financial outturn for the revenue account, capital programme, reserves, and the housing revenue account (HRA) for the financial year 2021/22.  

The general fund revenue outturn is a surplus of £6.8 million for the year, of which £3.3 million has already been allowed for in the budget for 2022/23.  It is proposed that the balance of £3.5 million is transferred to the financial resilience reserve to mitigate the emerging in-yearcost of living inflationary pressures. The position compared with quarter three reflects faster income recovery after Covid and higher expenditure savings, with some efficiencies now recognised from the transformation programme.

This improvement has meant that resources previously earmarked to support net overspending across services can instead be carried forward to support the cost of living crisis and medium term financial plan (MTFP). The statutory requirements are that the council undertakes prudent financial planning as evidenced by   delivery of a highly positive outturn   

RECOMMENDED that Council: -

(a)    approve that the final revenue surplus for the year of £6.8 million is added to financial resilience reserve with the extra £3.5m not assumed in the 2022/23 budget being used to mitigate the emerging inflationary cost of living pressures; and

(b)    approve the capital virement as set out in paragraph 97.

RESOLVED that Cabinet: -

(c)    approves the capital virements to accept new government grants as set out in paragraph 96.

Voting: Unanimous

Portfolio Holder: Leader of the Council

Reason

·     To comply with accounting codes of practice and best practice which requires councils to report their end of year financial position compared with the budget of the authority.

·     To comply with the council’s financial regulations regarding budget virements and the acceptance of new grants

The Leader of the Council presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix 'A' to these Minutes in the Minute Book.

Cabinet was advised that the report provided details of the final financial outturn for the revenue account, capital programme, reserves, and the housing revenue account (HRA) for the financial year 2021/22.  

In relation to this Cabinet was informed that the general fund revenue outturn is a surplus of £6.8 million for the year, of which £3.3 million has already been allowed for in the budget for 2022/23, and that it is proposed that the balance of £3.5 million is transferred to the financial resilience reserve to mitigate the emerging in-yearcost of living inflationary pressures.

Cabinet was advised that the position compared with quarter three reflects faster income recovery after Covid and higher expenditure savings, with some efficiencies now recognised from the transformation programme, and that this improvement has meant that resources previously earmarked to support net overspending across services can instead be carried forward to support the cost-of-living crisis and medium-term financial plan (MTFP).

Cabinet was further informed that the statutory requirements are that the council undertakes prudent financial planning as evidenced by delivery of a highly positive outturn.

The Chairman of the Corporate and Community Overview and Scrutiny Committee addressed the Cabinet advising that at their recent meeting the Committee had extensively discussed the report but had proposed no formal recommendations. 

RECOMMENDED that Council: -

(a)    approve that the final revenue surplus for the year of £6.8 million is added to financial resilience reserve with the extra £3.5m not assumed in the 2022/23 budget being used to mitigate the emerging inflationary cost of living pressures; and

(b)    approve the capital virement as set out in paragraph 97.

RESOLVED that Cabinet: -

(c)    approves the capital virements to accept new government grants as set out in paragraph 96.

Voting: Unanimous

Portfolio Holder: Leader of the Council

The Leader of the Council and Portfolio Holder for Finance and Transformation presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix 'B' to these Minutes in the minute Book. The Leader placed on record his thanks to officers for supporting everyone through this process and especially to all officers in the finance team. The Committee also unanimously offered their thanks and support to the officers in the finance team. There were a number of points raised and responded to in the ensuing discussion including:

·     An explanation of the provision for £5.45m in respect of Bournemouth Development Company was requested as it appeared to be an expense which was not recoverable and would therefore be counted as a loss.  The Portfolio Holder was asked whether this provision would mean BDC was making a loss. The Leader explained that effectively the scheme had been paused to allow Future Places to look at this in the round. The entire £10m from both joint owners of BDC could remain capitalised, if the scheme was to go ahead then the additional funds would just be overly prudent. It was expected that profits coming forward would offset any losses. The Leader advised that if anyone wanted to discuss this with him further he would be happy go into further depth .

·     There was a further concern raised regarding the implications of this for other planned work by the BDC and also Futureplaces and the level of confidence in being able to deliver schemes going forward especially in the current financial climate. The Leader advised that there was plenty of third-party finance available as long as the right schemes were coming through. There would be a higher bar set for schemes moving forward as they would need to fit with wider regeneration.

·     Whether the Council had needed to make the £5.45 million provision because MUSE had already decided to make provision of the same, which seemed to indicate a lack of confidence. 

·     Whether there was any risk in losing any underspends outlined in the Capital Programme around the Transforming Cities Fund. The Leader advised that they were committed to the TCF and this was not his understanding but he would seek clarification on this issue with the Portfolio Holder.

·     What plans there were to address the Dedicated Schools Grant and bring down overspend. The Leader agreed that it was a material risk to the authority. The Government gave local authorities the ability to place this off of balance sheets and the Council were trying to bring this down before the flexibility ends. It was suggested that it would be a useful piece of scrutiny to look at the work going on to address this.  It was noted that this was a problem nationally.

·     Concerns were raised that some of the savings outlined had only been able to be achieved because certain things were not done, for example the seafront team had not been able to  ...  view the full minutes text for item 17