Agenda item

Amended Budget 2020/21

Report of the Cabinet Member for Finance and Resources setting out amended Budget proposals for 2020/21 as a result of the COVID-19 crisis to reflect the changes in the income and expenditure budgets set by Council on 2 March 2020.

Decision:

Decision:

 

Cabinet recommends to Council:

 

1)    An increase in the salary and member allowances budgets of an additional 0.75% in order to meet the national pay agreement for 2020/21 of 2.75%.

2)    The draft proposed budget amendments for the 2020/21 budget framework contained within the Cabinet Member for Finance and Resources report and associated appendices subject to the following amendments:

 

                    i.          The Bourne Corn Exchange refurbishment to fully utilise the £168,000 allocated budget.

                   ii.          The £200,000 replacement of the Deepings all weather pitch to be deferred until 2021/22 provided agreement is reached with the football foundation.

                 iii.          To adjust the Commercial and Operations service cost to apply a 5%market supplement for loader and operational street scene staff to align their basic wage with that of the surrounding authorities. This will require a £93,000 adjustment to the Commercial and Operations service cost shown at table 3 of the report, increasing the 2020/21 proposed service budget to £8.727m (thereby increasing the proposed service variance to £1,319,000) and adjusting the general funding net budget requirement from £20.581m to £20.674m). The forecast net budget deficit will be £1,315,000 as shown at table 3 of the report.

 

Considerations/Reasons for decision:

 

  • Report of the Cabinet Member for Finance on the Amended Budget Proposals 2020/21.
  • The impact of Covid-19 on the budget set by Council on 2 March 2020.
  • Budget monitoring undertaken by the Finance, Economic Development and Corporate Services Overview and Scrutiny Committee.
  • Discussion of the proposed amended budget by the Joint Budget Overview and Scrutiny Committee held on 26 August 2020.
  • The allocation of £500m funding from the Government, of which £194,000 would be received by the Council.
  • The Government’s introduction of a co-payment scheme to compensate local authorities for relevant, irrecoverable losses in 2020/21 from loss of income.
  • The impact of Covid-19 in the long term and the volatility and uncertainty in forecasting assumptions for the financial year.
  • The Local Government Service Pay Agreement 2020/21 of 2.75%, a 0.75% increase on the budget framework agreed on 2 March 2020.
  • The bonus payment paid to street scene operatives during the Covid-19 response period, which was due to end on 30 September 2020.
  • Comparison between the rates of pay for South Kesteven’s Street Scene operatives and their counterparts across Lincolnshire.

 

Other options considered:

 

There is no option but to review and amend the current budget framework due to the ongoing impact from both an income and expenditure perspective.

Minutes:

The Leader of the Council thanked the Cabinet Member for Finance and Resources for his strategic direction and also the Finance Team and the Joint Budget Overview and Scrutiny Committee for their work on the amended budget 2020/21.

 

The Cabinet Member for Finance and Resources presented his report and stated that as a result of the Covid-19 pandemic an amended budget was required to reflect significant changes in the income and expenditure budgets.  The Joint Budget Overview and Scrutiny Committee had met on 26 August 2020 to discuss the amended budget for 2020/21. Members were supportive of the proposed amendments.

 

The Cabinet Member for Finance and Resources highlighted two changes to the budget since the Joint Budget Overview and Scrutiny Committee. He  confirmed that the £168,000 budget for the Bourne Corn Exchange refurbishment would be fully utilised and that the £200,000 for the artificial football pitch at Deeping St James would be deferred until 2021/22 provided confirmation was received from the Football Foundation.    The remainder of the budget remained the same.  He drew members attention to the recommendation which proposed an increase of 0.75% on the salary and member allowance budgets to meet the national pay agreement of 2.75%; 2% had been allocated when the budget had been approved on 2 March 2020. 

 

The Cabinet Member for Finance and Resources stated that he was aware that the Cabinet Member for Commercial and Operations also had an amendment to propose.  The amended budget proposed gave a deficit position, however, the report detailed a number of interventions and actions that would be overseen to mitigate the impact on the Council’s budget stabilisation reserve.  The budget would be kept under close review for the remainder of the financial year. 

 

The report also detailed the Governments reimbursement scheme for fees and charges.  A submission for the period April to June would be made in September 2020.   The forecast was for £1.4m and was on top of the monies highlighted in Table 1 of the Cabinet Member for Finance and Resources’ report. 

 

The Cabinet Member for Commercial and Operations proposed a small amendment which concerned payment to waste operatives.  During the Covid-19 pandemic it had become apparent that one of the critical services to be maintained was the collection of waste.  To reward the diligence of teams during the crisis, a £50 per week bonus was given to the waste teams which was due to end on 30 September 2020.  South Kesteven waste operatives were the lowest paid waste and street scene operatives in Lincolnshire.  Plans were in place to correct the issue before the next years budget, however in order to put their wages on a par with their colleagues in neighbouring authorities it was proposed to move their bonus status to their expected new level from October 2020.  The Cabinet Member for Commercial and Operations proposed an amendment to:

 

Adjust the proposed amended budgets to apply a 5% market supplement for loader and operational street scene staff to align their basic wage with that of the surrounding authorities. This would require a £93,000 adjustment to the Commercial and Operations service cost shown at Table 3 of the report increasing the 2020/21 proposed service budget to £8.727m (thereby increasing the proposed service variance to £1,319,000) and adjusting the general funding net budget requirement from £20.581m to £20.674m). The amendment, if supported would increase the forecast net budget deficit to £1,315,000 as shown at Table 3 of the report.

 

The Cabinet Member for Finance and Resources supported the proposed amendment.

 

A question was asked by a Non Cabinet Member about the salaries of EnvironmentSK employees and it was stated that this was not a matter for the Council to discuss, the employees would be paid in line with market salaries.

 

On being put to the vote it was AGREED that:

 

Cabinet recommends to Council:

 

1)    An increase in the salary and Members’ allowances budgets of an additional 0.75% in order to meet the national pay agreement for 2020/21 of 2.75%.

2)    The draft proposed budget amendments for the 2020/21 budget framework contained within the Cabinet Member for Finance and Resources report and associated appendices subject to the following amendments:

 

                         i.            The Bourne Corn Exchange refurbishment to fully utilise the £168,000 allocated budget.

                       ii.            The £200,000 replacement of the Deepings all weather pitch to be deferred until 2021/22 provided agreement is reached with the Football Foundation.

                      iii.            To adjust the Commercial and Operations service cost to apply a 5%market supplement from 1 October 2020 for loader and operational street scene staff to align their basic wage with that of the surrounding authorities. This will require a £93,000 adjustment to the Commercial and Operations service cost shown at table 3 of the report, increasing the 2020/21 proposed service budget to £8.727m (thereby increasing the proposed service variance to £1,319,000) and adjusting the general funding net budget requirement from £20.581m to £20.674m). The forecast net budget deficit will be £1,315,000 as shown at table 3 of the report.

 

Supporting documents: