Agenda item

To consider the quarterly budget position. 

That the financial performance information for the first quarter of 2020/21 be NOTED.  

33.1          The report of the Head of Finance and Asset Management, circulated at Pages No. 66-79, highlighted a quarter one deficit 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 for the first quarter of 2020/21.

33.2          Members were advised that unfortunately a significant deficit of £444,000 was being reported; however, overall, the financial position was not as bad as first feared due to the COVID-19 pandemic. The position was summarised within the report at Paragraph 2.1 and in Appendix A.  The Head of Finance and Asset Management explained that the COVID-19 financial position was being analysed separately and the main contributions to those costs were the Places Leisure contract payment; purchase of laptops for remote working; Personal Protective Equipment (PPE); and the additional costs from Ubico in terms of staffing etc. for safe working requirements. Income levels were substantially down in several areas but the quarter two information to date suggested an early recovery in some services.

33.3          With regards to savings, the Head of Finance and Asset Management explained that the largest area of saving in this quarter was within the employees heading and that highlighted the number of staff vacancies the Council had needed to manage during the COVID-19 response as well as providing a normal level of activity in core services. Recruitment was now beginning to take place and the Council was receiving a high number of applications to some posts which was great news. In terms of the pay award, 2% had been allocated within the budget but that had not been spent in the first quarter; an award of 2.75% had now been agreed and that would be backdated to April – this would be covered by the contingency that had been put into place when the budget had been set.

33.4          An updated COVID-19 impact forecast was included in the report at Paragraph 2.6 and Members were reminded that this was not a full budget forecast at this stage and, overall, the expenditure remained around £3 million.

33.5          During the discussion which ensued, a Member questioned whether the underspend on employees would have an impact on the performance indicators going forward; he was acutely aware that the Council sometimes had issues when it was understaffed. In response, the Head of Finance and Asset Management explained that it was difficult to know the contingencies that had been put into place by different services, or how staff had been redeployed during the COVID-19 pandemic, so he was unable to provide a full response to that query. In terms of the finance team, there were a couple of vacancies which should be filled soon; however, the service had not been unduly impacted in the first quarter from those vacancies. In addition, the Deputy Chief Executive explained that one of the things the recovery plan would look to do was to implement clear and transparent methodology for each service area to understand the implications of COVID-19. A template was currently being put together for each Head of Service and Operational Manager which, once completed, would help the authority understand the resource implications and how they could be addressed. In addition, he confirmed that the Recovery Plan reflected the priorities of the Council Plan and, as such, the performance trackers for each plan would be twin-tracked going forward with both trackers being considered by the Overview and Scrutiny Committee and the Executive Committee; this would help clearly explain where actions had been reprioritised into a different workstream, which actions had been superseded and what was still moving forward.

33.6          In response to a query regarding community grants, the Head of Finance and Asset Management confirmed that, at the time of writing the report, the fund was £710,000 underspent; however, applications were still being received so that figure was likely to be less now. The government had been firm in its stance that any unspent monies would have to be returned to central government after the closure of the scheme on 28 August.

33.7          A Member expressed his thanks to the finance team for keeping Members informed of the position of the Council’s finances in a clear way even in these exceptional times. Accordingly, it was