Agenda item

This report provides the Governance and Audit Committee with details of the Council’s outturn position for the financial year 2020 - 2021.

The Interim Director of Finance and Section 151 Officer presented a report which provided the Governance and Audit Committee with details of the Council’s outturn position for the financial year 2020/21 and covered the general fund revenue budget, the housing revenue account budget and capital programmes relating to the general fund and housing revenue account.

From a financial perspective it was noted that 2020/21 had been the most turbulent year for many years and one that had proved extremely challenging. The Council had responded in many ways, including the formation of Covid-19 financial impact reports that tracked and monitored the situation throughout the year. This culminated in an amended budget approved by the Council on 17 September 2020 which set out the budget allocations that required re-basing and showed in detail the full extent of the potential deficit the Council was potentially exposed to, based upon a range of scenarios and in the absence of mitigating actions being implemented. The budget report also confirmed that the Council’s budget stabilisation reserve had not been required to balance the financial year. This reserve was further bolstered by specific allocations to it as part of the budget framework proposals for 2021/22 that were approved by Council on 1 March 2021.

The Interim Director of Finance and Section 151 Officer took members through the report, which captured the volatility that ensued throughout the year and highlighted the changes that had occurred together with the nature and level of grants that had been allocated directly to the Council to support its financial stability. It also set out details of the grants that were administered by the Council for its residents and businesses throughout the year. It was noted that the variance and explanatory information contained within the report was based on the comparison between the amended budget and the outturn rather than the original budget that was set in March 2020.

In presenting the report, members noted the update position in relation to:

·         general fund revenue budget amendments;

·         general revenue outturn position;

·         removal of accounting adjustments;

·         general revenue outturn position, excluding accounting adjustments;

·         specific Covid-19 grants 2020/21;

·         general fund significant income streams;

·         general fund capital programme;

·         general fund reserves;

·         housing revenue account revenue outturn position;

·         housing revenue capital programme;

·         housing revenue account reserves.

With regard to the housing new build ambition, a concern was expressed that construction costs had increased significantly as a result of the Covid-19 pandemic and whether, in view of this, the reserves would be sufficient to fund the programme. Confirmation was provided that the capital budgets were costed before any increases in such costs and, therefore, there was a risk that the budget allocations may be insufficient. In this scenario, Members would need to consider whether the programme required amending accordingly.

In reference to £200,000 in the general fund reserves in respect of the 3G football pitch, a question was asked as to whether this was for The Deepings. Members were informed that this allocation was for the Meres Leisure Centre in Grantham in response to a requirement of Sport England for the Council to have a sinking fund in place. The provision of a 3G football pitch for The Deepings was included in the Capital Programme for 2021/22.

Decision:

That the Governance and Audit Committee:

(1)  Approves the revenue and capital outturn report and associated appendices for the financial year 2020/21.

(2)  Approves the proposed reserve movements as set out in the report.

(3)  Notes the budget carry forwards to be included into the 2021/22 budget framework as set out in Appendices D and H.