Issue - meetings

Provisional Outturn Report 2018/19

Meeting: 20/06/2019 - Executive (Item 19)

19 Provisional Outturn Report 2018/19

To consider the Provisional Revenue and Capital Outturn for the

2018/19 financial year.

Supporting documents:

Decision:

RECOMMENDED that the 2018/19 prudential and treasury indicators, set out in the Annual Treasury Management report at Annex 3 of the report to the Executive from the Head of Finance and Assets, be approved.

RESOLVED that:

(i)            The provisional revenue and capital outturn position for 2018/19 be noted; and

(ii)          The use of reserves proposed in paragraph 11 of the report to the Executive be endorsed and the Head of Finance and Assets be authorised to make the necessary arrangements.

Minutes:

Councillor T. Schofield, Deputy Leader and Executive Member for Finance, introduced the report and advised the Executive of the provisional revenue and capital expenditure for 2018/19.

The Executive was informed that the capital programme had progressed well in 2018/19 with a lower underspend than recent years of £3.29 million or 8% compared to original forecasts. In response to questions, Councillor Schofield highlighted that significant progress had been delivered across a number of major projects which had supported strategic objectives, including Marketfield Way. It was also noted that the Council had invested in additional commercial properties in order to achieve sustainable new income sources as well as maintaining operational assets, including play areas and car parks.

In terms of the revenue budget, Councillor Schofield explained that the outcome for 2018/19 was a favourable variance of £1.6 million or 9% compared to original forecasts. It was noted that income receipts had been particularly buoyant. For example, recyclate prices had been higher than expected, membership of the Garden Waste scheme had continued to increase, investment in the Council's property portfolio had resulted in new income streams, while planning fee income was higher than originally forecast. Councillor Schofield also explained that borrowing costs had been lower compared to the forecasts and that there were budget savings due to staff vacancies as new management structures were implemented. In response to questions, the Executive was informed that the main cost pressures during the year related to the continued requirement to buy in external legal services and a slightly lower than expected benefit subsidy from Government.

The report also confirmed the outturn position for the Headroom Contingency Budget. It was highlighted that this had taken into account the one-off charge to the accounts that had been necessary to resolve long-standing bank reconciliation balances. In response to questions, it was explained that details relating to this transaction would be reported to the Executive in July 2019 when the statement of accounts for the year were presented, following completion of the audit.

Councillor Schofield explained that the proposed use of the revenue underspend, to establish two new earmarked reserves, had been set out in paragraph 11 of the report. The Executive was informed that the first would help fund new posts which were being established across the Council during 2019/20 to support the delivery of corporate priorities. The second, to be overseen by the new Commercial Ventures Sub Committee, would be used to fund feasibility studies for new commercial initiatives to help ensure businesses cases were robust.   

In terms of Treasury Management, it was noted that the report presented the outturn position for treasury activities and confirmed that the Council had complied with treasury policies previously approved. It was noted that this formed part of the formal reporting requirements of the CIPFA Code of Practice on Treasury Management.  

The Overview and Scrutiny Committee considered the report on 6 June 2019.  The Deputy Leader and Executive Member for Finance thanked the Committee for its questions, observations and comments. The suggestions  ...  view the full minutes text for item 19


Meeting: 06/06/2019 - Overview and Scrutiny Committee (Item 7)

7 Provisional Outturn Report 2018/19

To consider the provisional 2018/19 outturn report for Revenue, Capital and Treasury Management, to be reported to the Executive on 20 June 2019.

To consider any Advance Questions submitted.

Supporting documents:

Minutes:

The Committee considered the provisional 2018/19 outturn report for Revenue, Capital and Treasury Management, to be reported to the Executive on 20 June 2019.

Councillor T Schofield, Executive Member for Finance, gave an overview of how the Council performed in the 2018/19 financial year (subject to final figures approved by the Council’s External Auditors).

The capital programme progressed well in 2018/19 with a lower underspend than recent years of £3.29m or 8% compared to original forecasts. 

As reported during the year, significant progress has been delivered across a number of major projects which support the Council’s objectives, including Marketfield Way. The Council has also invested in additional commercial properties to support our ambition to achieve sustainable new income sources as well as maintaining our operational assets including play areas and car parks.

 

Revenue Budget Outturn 2018/19

For the Revenue budget the outcome this year has been a favourable variance of £1.62m or 9%. Income receipts were particularly buoyant:

·       recyclate prices were higher than expected and membership of the Garden Waste scheme continued to increase (£0.58m favourable).

·       Investment in our property portfolio resulted in new income streams (£0.18m favourable).

·       Planning fee income was higher than originally forecast (£0.26m favourable).

Borrowing costs were lower compared to the plan as the calls for property investments were lower than the forecasts when the treasury budget was prepared (£0.29m favourable) and there were budget savings due to staff vacancies as new management structures were implemented (£0.26m favourable). The main cost pressures during the year related to the continued requirement to buy in external legal services (£0.16m adverse) and slightly lower than expected benefit subsidy from Government (£0.12m adverse).

 

The report also confirmed the outturn position for the Headroom Contingency Budget after taking into account the one-off charge to the accounts that has been necessary to resolve long-standing bank reconciliation balances (£0.476m). This matter had been discussed at previous meetings of the Committee and of the Executive. The details relating to this charge would be reported when the statement of accounts for the year is presented to Executive in July following completion of the audit.

 

In view of the net £1.6m positive variance it is recommended that some of this resource be used to set up two new earmarked reserves which were:

1.     £0.5m to help fund new posts that are being established across the council during 2019/20 to support delivery of corporate priorities.

2.     £0.25m to be overseen by the new Commercial Ventures Sub-Committee and used to fund Feasibility Studies for new commercial initiatives to help ensure that business cases are robust.

 

Treasury Management Outturn 2018/19

The Treasury Management Strategy outturn report confirmed the Council has complied with Treasury policies previously approved by Council for 2018/19 and complied with the CIFPA Code of Practice on Treasury Management for local authorities.

 

In summary, despite continued financial challenges faced by local government (and at a time when many authorities were making damaging cuts and selling assets), the Council remained confident it would continue to run an ambitious  ...  view the full minutes text for item 7