Agenda item

The Leader of the Council presented the report which concerned the Provisional Outturn Report for 2023/24.  He thanked Officers for their hard work and diligence in putting all the reports together for the Committee.  The report covered:

·       The General Fund (GF) Revenue Budget

·       The Housing Revenue Account (HRA) Budget

·       The Capital Programmes – General Fund and Housing Revenue Account

·       The Reserves Statement – General Fund and Housing Revenue Account

In introducing the report, the Leader commented on the new Housing System which had not interacted with the other accounting systems as expected, which had caused problems in retrieving the necessary data for the outturn report.  The Leader also commented on the scheduling of the report to the Governance and Audit Committee, ideally the report should have been to the Finance and Economic OSC first, however, this had not happened even with the change of date for the Finance and Economic OSC.

The Council was in a relatively positive position, it had been anticipated that £1.534m of the Budget Stabilisation Reserve would be needed during 2023/24 in response to an unprecedented increase in budgets relating to utilities, inflation, material and fuel costs.  However, the Budget Stabilisation Reserve had not been required as the situation had improved which had given the Council more flexibility with the General Fund and the Housing Revenue Account budgets.  The Provisional Outturn report had been considered and debated at a recent Cabinet meeting and would be going before the next Finance and Economic OSC.

The Cabinet had considered a number of budget carry forwards which were listed within tables 1 and 3 of the report in respect of General Fund budget carry forwards and tables 6 and 8 of the report in respect of Housing Revenue Account budget carry forwards.  Regular monitoring reports had been provided throughout the year to keep Members informed of the accounting position and that the requirement to use the Budget Stabilisation Reserve was not needed due to the Council’s investments performing better than expected and the way that the Council had managed its money internally.

It was proposed that two reserves were strengthened and these were the ICT Reserve, an increase of £200K and the Property Maintenance Reserve, an increase of £250K which reflected the importance of keeping these reserves at a level that enabled continued investment to be made.  Reference was made to the recent cyber attacks on ICT systems nationally and the need to have systems that were up to date and resilient to attacks.  It was proposed that new reserves were formed and these were:

·       The creation of a Flood Reserve of £30K to fund unforeseen costs in the event of extreme weather conditions such as Storm Babet.

·       The creation of a Leisure Investment Reserve of £200K in order to provide one-off funding in respect of leisure initiatives, with reference being made to the investments required in respect of the management and maintenance of the leisure centres and the change in government policy following the recent election.  Reference was also made to the £850K reserve already in place in respect of the Deepings Leisure Centre if and when it materialised.

The report gave a positive position in respect of the outturn for 2023/24 taking into account the concerns that had been made at the beginning of the year in respect of energy prices and investment returns and he asked the Committee to approve the recommendations contained within the report.

The Deputy Chief Executive and Section 151 Officer reminded the Committee that they approved the recommended reserve movements that had been outlined by the Leader.   The Deputy Chief Executive and Section 151 Officer also highlighted the delegation within the recommendation which had been amended at Cabinet to also include the Cabinet Member for Housing.  The reason for the delegation was that work was continuing in respect of the Statement of Accounts and the working balances would need to be signed off and the end of year entries were still to be confirmed.   The GF and HRA balances needed to work within a tolerance of between 10% - 15% of the net operating expenditure which had been set by Council and was a target that needed to be worked towards.  It was possible that amendments could be required to reach this target.

The Deputy Chief Executive and Section 151 Officer confirmed that the Cabinet had approved the carry forwards as outlined within the report at their recent meeting which were for noting by the Committee.  He referred Members to the appendices of the report which gave greater detail in respect of the General Fund and Housing Revenue Account and also the Revenue Capital and Reserves for each area.  Members were referred to table 4 and table 9 of the report which detailed the General Fund Capital Outturn Position and the Housing Revenue Account Capital Outturn Position and the capital programme that had changed significantly from the start to the end of the year, with most budgets being carried forward to the current financial year.    The bolstering of the budgets that had been mentioned had been made in consultation with the Cabinet and were due to either spending pressures or the ambition to carry through with the project work.

Members noted the comments that had been made around the sequencing of the report to the various committees and the recommendations proposed and the reasons put forward for strengthening certain budgets and creating new budgets.  The Leader made reference to recommendation 3 which was the transfer of £100K from the HRA Priorities Reserve to create a HRA Climate Change Reserve which he felt was something to celebrate as it would enable climate change mitigation and adaptation measures within the Council’s housing stock and he wanted to draw the Committees attention to that recommendation.

One Member commented on the carryover of funding in respect of the Rough Sleeper project which she had concerns about, she asked what progress had been made with the project and what action was being taken to spend the funding this year.   The Deputy Chief Executive and Section 151 Officer indicated that updates were given to the Housing OSC and that the Officer in charge of this funding was the Head of Housing, he stated that he would be happy to ask that an update be given to the Member concerned.

Further comments were made in respect of the layout of the report which was easy to follow and the explanations given.  The recommendations contained within the report were proposed, seconded and AGREED.

Decision:

That the Governance and Audit Committee:

1.     Reviewed and approved the provisional Revenue and Capital Outturn Position and associated appendices for the financial year 2023/24.

2.     Reviewed and approved the following reserve movements in respect of the General Fund:

·       £680k of the Business Rates Volatility Reserve to be transferred to the:

·                  ICT Reserve – to be increased by £200k

·                 Property Maintenance Reserve – to be increased by £250k

·                 The creation of a Leisure Investment Reserve of £200k

·                  The creation of a Flood Reserve of £30k

3.      Reviewed and approved the following reserve movement in respect of the Housing Revenue Account:

·       Transfer £100k from the HRA Priorities Reserve to create a HRA Climate Change Reserve

4.     Delegate tothe Deputy Chief Executive and s151 Officer in consultation with the Cabinet Member for Finance & Economic Development and the Cabinet Member for Housing to finalise the reserve movements in order to ensure the Working Balance level for the General Fund and the Housing Revenue Account are maintained at prudent levels.

5.      Notes the Budget Carry Forwards as shown within the report at Sections 3, 4, 5 & 6.