Agenda item

To consider the Provisional Revenue and Capital Outturn for the

2018/19 financial year.

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 put forward by the Committee were welcomed by the Executive and it was noted that these had been fully captured in the minutes from the meeting.   

Councillor Schofield concluded by stating that despite the challenges, at a time when many local authorities were making cuts and selling off assets, that the Council would continue to be ambitious and would continue to deliver excellent services to residents.  

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.

Reason for decisions: To advise Members of the revenue and capital expenditure for 2018/19, to seek authorisation for the proposed changes to reserves and to comply with the Council’s reporting requirements in relation to Treasury Management activity.

Alternative options: To amend, or reject, the proposals to adjust reserves as set out in the report.