Issue - meetings

To consider the quarterly budget position. 

That the financial performance for the first half of 2021/22 be NOTED.  

57.1          The report of the Head of Finance and Asset Management, circulated at Pages No. 35-59, set out the second quarterly monitoring report of the Council’s financial performance for the year and highlighted a projected outturn surplus based on the quarter two position of £3,611,060 on the revenue budget and detailed the expenditure to date against both the capital programme and the approved reserves. Members were asked to consider the financial performance information provided.

57.2          The Head of Finance and Asset Management explained that the budget for 2021/22 had been approved by Council in February 2021 with the reserves approved by Executive Committee in July 2021. The report before Members was the second quarterly monitoring report of the Council’s financial performance for the year. It was noted that the reported £3.6 million surplus was comprised of £3.6 million of S31 business rates grants which were required to be set aside to meet a business rates collection fund deficit in 2022/23. Therefore, the balance of the budget forecast at the end of the second quarter was cost neutral and on target to deliver an outturn in line with the original estimates for 2021/22. The Head of Finance and Asset Management drew attention to Paragraph 2.0 of the report and explained that the quarter two full year projection highlighted a full year cost of service provision totalling £12.334 million resulting in a surplus against the approved budget of £83,244. The main reasons for the projected surplus were set out in the report and in Appendix A. The full year projection for employees highlighted a potential gross surplus of £432,612; it should, however, be noted that within the Council’s corporate expenditure was a target to save £155,000 from employment costs across the Council. The net position was therefore a surplus against target of £277,612. The figures did not include the pay award which was still being negotiated but a reserve had been put aside which would equate to a 2% pay award. In terms of corporate expenditure, this highlighted an estimated surplus of £3,527,816 for the financial year. Treasury activities were expected to deliver small savings in borrowing costs and an increase in interest received from investing. The Council’s commercial portfolio was currently predicting a deficit on the year as a result of the unexpected temporary void at one office unit, a tenant exercising a mid-year break clause at an industrial unit and the inducements offered to secure leases at the Clevedon units. Should the commercial property account remain in deficit for the full-year, the Council would utilise the commercial property reserve to cover the void and lease costs resulting in no impact on the base budget position. The anticipated business rates showed a net surplus of approximately £2.9 million from the original budget compiled in December 2020. The major component of the surplus was the £3.62 million S31 grant paid by the government to provide further relief from business rates for businesses in certain sectors. Those businesses would receive the relief in  ...  view the full minutes text for item 57