Decision details

The Deputy Leader of the Council and Cabinet Member for Corporate Support introduced the revenue and capital outturn expenditure for 2019/20 explaining that the report set out the actual performance for Capital, Housing Revenue Account and General Fund Revenue against budget for 2019/20.

It was explained that despite the early effects of the Covid-19 pandemic the Council finished the financial year with some strong financial performance.  The supplementary estimates approved during the year were effectively covered by underspends in other areas and a review of unrequired earmarked reserves enabled an addition transfer to the Funding Resilience Reserve which now stands close to £6m (£5.826m).

            The Financial Services Manager, before commenting on the outturn report stated that she would like to take the opportunity to update Cabinet on the latest Covid-19 grant funding position.  The allocation of the third tranche of £500m had been announced on 16 July 2020 and it was pleasing to confirm that the Council would be receiving a further £264,767.  This was the highest amount for all the Districts in West Sussex and had been based on Round 2 and 3 spend, population and deprivation.  This made the total of non-ringfenced support £1.939m, meaning that Arun had received the highest level of grant funding out of all Districts in West Sussex.

In addition, separate compensation was anticipated for fees and charges such as car parking under the Income Loss Scheme, however, Leisure Trusts were not covered by the scheme at this stage nor were commercial and rental income.

            The Financial Services Manager then reported on the Revenue and Capital outturn 2019/20 report confirming that the draft accounts for the year ended 31 March 2020 were available to view on the Council’s website.  The Statements were currently being audited as originally planned for approval by the Audit and Governance Committee on 30 July 2020, however, achieving this deadline was subject to significant additional risk this year mainly due to the increased uncertainty due to Covid 19 including the issues that were completely out of the Council’s control like the conclusion of the audit of the West Sussex County Council pension fund.

It was outlined that if there were any material changes specially to the usable reserve balances, then a full update would be provided to the next meeting of Cabinet on 21 September 2020.

            Brief updates were then provided as follows:

·         General Fund Outturn 2019/20 - Section 2 - some of the variations against individual service budgets in appendix A were due to technical accounting requirements e.g. capital and special projects which were budgeted separately.  Also, the requirement to split current and past pension fund liabilities. 

The variations against original budget had been summarised in table 2.4 of the report. It was outlined that it should be noted that the outturn was made up of a significant number of over and underspends against budget.

The outturn was generally favourable which allowed an additional contribution of £844k (balance £5.826m) to the Funding Resilience Reserve.  This reserve was set up to allow the Council a planned reduction in net expenditure due to pressures from reduced funding.  This included Recycling Credits (£826k 2019/20) as well as the reset of the Business Rates.

·         Capital and Asset Management C – the review of GF assets in 2019/20 found these assets would require significant investment to keep them to the required standard for service delivery.  £390k was identified and placed in an earmarked reserve to contribute towards these works in the future.

·         Appendix D Capital Receipts – this showed £2.815m of capital receipts at 31 March 2020 of which £1.812m related to 1 for 1s to right to buy

·         Earmarked reserves of £15.768m were shown in portfolios in Appendix E

·         The total s106 developer contributions held on deposit at 1 March 2020 was £8.544m.

The Chairman thanked the Financial Services Manager for a most comprehensive report and extended Cabinet’s thanks to the entire Finance team for their superb work in looking after the Council’s financial resources and during such exceptional times.

            The Cabinet

                        RESOLVED – That

(1)  The outturn report at Appendix 1 be noted;

(2)  The revenue and capital outturn expenditure for 2019/20 be noted;

(3)  The level of balances and unused Section 106 sums at 31 March be approved;

(4)  The additional contribution of £0.844m to the Funding Resilience Reserve be noted; and

(5)  The additional £249k required to complete the Housing Revenue Account (HRA) part of the Housing service restructure in 2020/21 be noted.

The Cabinet confirmed its decision as per Decision Notice C/006/200720, a copy of which is attached to the signed copy of the Minutes.