To consider the following finance related reports scheduled for Cabinet consideration on 24 June 2020:
· Budget Rebase 2020/21 – the revised annual budget for 2020/21 to recognise the financial impact of Covid-19.
The O&S Board is asked to scrutinise the report and make recommendations to Cabinet as appropriate.
Cabinet member invited to attend for this item: Councillor David Brown, Portfolio Holder for Finance.
The Cabinet report will be published on Friday 5 June 2020 and available to view at the following link: https://democracy.bcpcouncil.gov.uk/ieListDocuments.aspx?CId=285&MId=4290&Ver=4
Minutes:
Budget Monitoring Report – June 2020 - The Portfolio Holder for Finance introduced the report, a copy of which had been circulated and which appears as Appendix D to the Cabinet minutes of 24 June 2020 in the Minute Book. A number of issues were raised by the Board in the subsequent discussion, including:
There were concerns expressed that the paper was not proposing a full Cabinet decision on the significant amendments to the Budget but rather asking that Cabinet note these changes. It was noted that previous papers indicated that this would be a proposed update to the Budget which was outlined to full Council in February. The Portfolio Holder advised that as work progressed on the financial situation it was proposed that this would be an update to the February Budget rather than a rebuild of the budget. The Board was advised that there were still a lot of unknowns at present and there was a need to be able to continue to respond to these issues throughout the year. The Portfolio Holder advised that there was no doubt that the numbers outlined in the report would change, using the 24-week scenario in the planning allowed the budge to respond to changing circumstances.
In response to a query regarding the financial prospects of the Council the Portfolio Holder confirmed that the Council was in a strong position to be able to cope with the financial impacts it was facing.
A Councillor asked if representations had been made to central government on the financial impact on local authorities and the Portfolio Holder responded that this had taken place both as an individual authority and jointly with other authorities through collective organisations and the LGA. The Local authority had also been doing this through the local MPs.
A Board Member stressed the importance of opening out the decisions concerning the revised budge to the whole Council as hey ought to be fully aware of the risks and the challenge of re-floating the economy in the BCP area. In addition to this another Board member commented that during his time in local government he had never seen such a substantial budget change not be considered by the full Council.
A Councillor asked about paragraph 65 of the report and the impact that delaying spend in some of these areas until 2021/22 would have on them particularly the environment but also highway maintenance and street cleansing It was noted that this would deliver substantial savings and there was funding to deliver more. There had been some underspend in this area due to Covid-19.
A Councillor raised a concern regarding the substantial savings which needed to be made from the various directorates and suggested that they were difficult to find as these could only be found in an appendix to the report and felt there should have been more transparency. The Portfolio Holder noted the significant financial impact but commented that there was a need to swiftly review the impact and find resources to mitigate the impact. Some of the savings were almost naturally occurring as a consequence of the epidemic and a number were delaying particular projects. There was also an effort to try to find recurring savings which could be made which would also contribute to meeting the budget gap for next years budget which reflected work which would be happening anyway and would take away the pressure on the Medium Term Financial Plan.
A Councillor raised a concern that O&S Board members were making several comments rather than contributing and asked the Portfolio Holder what O&S Board could do to be helpful in these unprecedented times. The Portfolio Holder advised that O&S Board needed to be satisfied that the scenario planning was the best it could possibly be and that monitoring of the budget was continuous. The Local Government association had used BCP Council in one of its case studies and the LGA considered that the Council was doing everything it could.
A Councillor raised a concern that the next quarterly report would possibly not be due until October and that this was too long to wait in order to fully understand what the Council had been facing. It was noted that quarterly budget monitoring would be kept under review and any significant changes or government funding would be brought to Cabinet and O&S Board if required.
Due to the significance of the shortfall in funding to covered the Covid-19 epidemic a Councillor proposed that Councillors from all sides sign a letter, copied to local MPs, seeking action to address the gap between the actual cost of dealing with the pandemic, and the recompense made thus far by Government to local government. The motion was seconded and put to the vote which was lost.
A Councillor commented that response in terms of the budget to the situation needed to be continuous and flexible and noted that no alternative proposals had been put forward by the Board and suggested that requiring the budget to go to full Council would be causing unnecessary delays.
RESOLVED that the Overview and Scrutiny Board is surprised and disappointed that such a substantial rebase of the budget for the Council is not being put before all elected Councillors for their consideration and approval. This includes Cabinet, where the recommendation on the Cabinet Paper reads that the proposed £30m of savings should be “noted”, not even approved.
RECOMEMNDED that the revised budget as outlined in the Cabinet report be put before Full Council in the normal fashion for a budget decision.
Voting: For: 8, Against: 5, 1 abstention