Issue - meetings

Emergency Budget 2020/21

Meeting: 07/07/2020 - Executive (Item 73)

73 Emergency Budget 2020/21 pdf icon PDF 353 KB

To consider the report of the Chief Finance Officer.

 

Additional documents:

Decision:

Agreed

RECOMMENDED that Council:-

 

(1)  approve the Council’s revised spending proposals in respect of both its General Fund and HRA revenue budgets; and

(2)  notes that the future budget monitoring reports will assess the position against the revised budget and further decisions may be required depending on the economic impact being experienced as the year progresses; and

(3)  approves a budget of up to £1 million delegated to the Chief Executive, in consultation with the Leader and Chief Finance Officer, the budget to be used to fund urgent issues arising out of the response to Covid-19 and to offset the reductions in service budgets if required for urgent issues with the funds to be allocated from the income loss compensation announced by the Government.

Reason for Decision:

As set out in the report.

 

 

 

Minutes:

The Executive received the report on the impact of Covid-19 in relation to the finances of local authorities. Exeter had received £1.379 million of funding from Government, however the scale of income loss and additional expenditure incurred because of Covid-19 and the lockdown was larger than the additional funding received.

 

The Chief Finance Officer commented on the impact on business rates and the implications for the economy, particularly the key income streams for the city council in relation to the city centre, which were matters that would challenge the medium term financial plan. He highlighted the following details in respect of the need for the Council to make further savings of £5.8 million over the next three years:-

 

·         an extra spend of £2.62 million including support for rough sleepers, creation of the wellbeing hub and providing new refuse vehicles;

·         an income loss of £8.56 million;

·         Government announcement of additional support anticipated in respect of fees and charges but not commercial rent;

·         anticipated irrecoverable losses from sales, fees and charges for the year of £5.5 million with approximately £3.9 million compensation anticipated;

·         gap of £11.2 million, representing nearly a third of the Council’s gross budget of £35 million. A revised budget for 2020/21 was necessary to address the additional expenditure and loss of income experienced whilst maintaining the General Fund Working Balance above the minimum level of £3 million;

·         proposal to help balance the budget included £1.4 million Government grant, £1.2 million from General Fund Working Balance, use of Earmarked Reserves; offsetting repayment of debts against previous re-payments, the receipt of £1.7 million from the RAMM Business Rates valuation appeal and reductions in service expenditure totalling over £1.7 million;

·         future pressures included a pay award and supplementary budgets, possible additional costs bringing Leisure Services in house and the extension of rough sleeper support; and

·         the District Councils’ network was lobbying Government for support to both Leisure Services and the Housing Revenue Account (HRA).

 

During the discussion, the following points were raised:-

 

·         the immediate action to support rough sleepers came at a cost to the Council of £180,000 but with only £24,000 received in grant;

·         overall additional Government support of £500 million likely to be distributed to upper tier authorities and lack of clarity given when the Government announces support;

·         the Council was committed to working with local businesses through the Place Board to ensure that Exeter recovers as quickly as possible from the crisis; and

·         the Council is committed to maintaining front line services for the city

 

RECOMMENDED that Council:-

 

(1)        approves the Council’s revised spending proposals in respect of both its General Fund and HRA revenue budgets;

 

(2)        notes that the future budget monitoring reports will assess the position against the revised budget and further decisions may be required depending on the economic impact being experienced as the year progresses; and

 

(3)        approves a budget of up to £1 million delegated to the Chief Executive, in consultation with the Leader and Chief Finance Officer. The budget to be used to  ...  view the full minutes text for item 73