Agenda item

The report sets out the Revenue and Capital outturn position for Buckinghamshire Council for the financial year 2020/21 as at quarter 3.

RESOLVED –

Cabinet noted the current forecast outturn for the financial year 2020/21 and the latest estimates of impacts and funding related to Covid-19.

Katrina Wood, Deputy Leader and Cabinet Member for Resources, introduced the report which set out the overview of the financial Revenue and Capital outturn position for Buckinghamshire Council for the financial year 2020/21 as at quarter 3.  The report took into account the pressures relating to Covid-19 and also the business as usual activity.

The forecast Revenue outturn was an overspend of £0.1m, which had reduced from the £4.9m reported for Quarter 2, with the improvement due to additional funding and the active management of overspends.   The forecast Capital outturn was £160 million, representing slippage of £27.7m.  This was an increase of £12.0m from the £15.7m reported at Quarter 2.  It was possible that the position could deteriorate further as a result of the latest lockdown.

The reported position did not include the impacts of the third lockdown which commenced in January 2021, and for which the financial implications were yet to be quantified.  Circumstances were continuing to change and consequently the forecast outturn position would continue to be monitored closely.  The Council was currently holding circa £47m of General Fund Reserves, which was a significantly healthier position than many other Local Authorities.

Mitigating actions to address the slight in-year forecast revenue overspend included continuing to lobby the government for the full recovery of all additional expenditure and lost income in relation to Covid-19, action within Directorates to identify additional mitigations, as well as the review of commitments against earmarked reserves and corporate contingencies included within the budget.  Actions already identified had contributed to the reduction in the forecast overspend.

Members were informed that all Directorates appeared to be forecasting an overspend this year, with the major driver behind this being the loss of income and increased costs in relation to the Council’s response to Covid-19.  Un-ringfenced grant funding to cover the impact of Covid-19 was being held corporately meaning that the overall position linked to the pandemic was an adverse position of £0.2m. 

The most significant movements in Directorate Business as Usual budgets were within Planning, Growth & sustainability, where the overspend had increased by £1.0m.  This was as a result of a review of pressures reported between Covid-19 and BAU, and an increase in the lost income from rental properties, which was not recoverable through the Government’s Sales, Fees & Charges scheme.

In Children’s Services the forecast BAU overspend had decreased by £1.2m to £4.1m.  This largely related to additional demand in Social Care which was not directly Covid-19 related, and ongoing pressures in Home to School transport budgets.

Corporate & Funding was forecast to underspend by £46.8m, due to an additional £42.8m of un-ringfenced grant income from central government in response to Covid-19.  At Quarter 2 this had been expected to be £39.6m; however, further funding announcements to support the ongoing costs of Covid-19 have been made during the latest reporting quarter. This comprised £32.3m of un-ringfenced grants to cover expenditure pressures and an estimated £10.5m of grant income from the Sales, Fees and Charges lost income compensation scheme (£9.6m has already been claimed).  In addition, £4m of corporate contingencies were not currently forecast as committed.

Appendix 1 to the report provided further detail on the revenue forecast outturn by Directorate.  Appendix 2 presented a breakdown of pressures arising from Covid-19. The 2020/21 pressure resulting from Covid-19 differs from the total pressure as approximately £0.4m of costs and lost income were absorbed within 2019/20, and £0.5m of grant had been applied to cover other Covid-19 costs within 2019/20.

The capital programme forecast outturn position (underspend/slippage of £27.7m (14.7%)) reflected the impacts of Covid-19, the establishment of the new Council and the fact that the programme was based mainly on legacy schemes that the new Council had inherited. In future years the programme would have been developed by the new Council and, as such, key decisions would have been made and it would be easier to profile spend and ensure that underspends were minimised.

Significant slippage / underspends had been reported in Children’s Services (£3.9m), Communities (£6.6m) and Planning, Growth & Sustainability (£16.6m).  Children’s Services slippage related to the School Places programme, where restricted site access had delayed progress.  Communities slippage related to Culture, Sport and Leisure of £2.4m, and Highways & Technical Services slippage of £5.6m largely on car park projects either delayed or cancelled due to current uncertainties.  Planning, Growth and Sustainability slippage largely comprised re-profiling of schemes with unrealistic expenditure profiles inherited from the legacy Councils.

The Leader stressed the many challenges that the Council had faced over the last year, and commended the Government who he believed had responded to assist the Council better than might have been anticipated.  The Government support plus internal savings achieved meant that the Council was on track to deliver a balanced budget at year’s end.

RESOLVED

Cabinet noted the current forecast outturn for the financial year 2020/21 and the latest estimates of impacts and funding related to Covid-19.