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Cabinet received report ES/0825 by the Cabinet Member with responsibility for Resources, who stated that his report provided an overview of the Council’s draft outturn position for 2020/2021 in respect of the General Fund, Reserves, Housing Revenue Account (HRA), the Capital Programme and the Collection Fund.
2020/2021 was, Councillor Cook reported, an unprecedented year, and the net budget impact of Covid-19 on the General Fund was forecast in the region of £8.6m, during the first quarter of the year. However, over the course of the last 12 months, there had been significant Government funding to support the Council’s response to the pandemic and to lessen the impact on the Council’s finances from additional cost pressures and loss of income. This was an area of significant uncertainty and fast moving developments, and was extremely difficult to forecast, especially the economic impact on Council income streams. As a result, the most significant variance from revised budget to actual was in relation to Covid, which had led to an outturn surplus for the General Fund of £1.1m. The proposal was for this balance to be transferred to the Transformation Reserve to provide funding for the delivery of the Council’s Strategic Plan.
As at 31 March 2021, Councillor Cook reported, the total on the Council’s earmarked reserves stood at £73.8m. This was an increase of £27.3m on March 2020, arising from additional income from Business Rates and funding for Community Projects and Covid-19 which would be utilised in the current year. It was worth noting, Councillor Cook advised Cabinet, that £42.1m (57%) of the year-end balance was held across four earmarked reserves for Business Rates, Capital, Covid and Port Health.
The HRA reported a small outturn variance of £39k against the revised budget. The most significant variances to report were due to re-phasing of the Housing Development Programme. The General Fund Capital Programme reported a £5.05m underspend at the end of the year due to projects being re-phased to 21/22.
The outturn position would feed into the review and update of the Medium Term Financial Strategy, the Capital Programme and the HRA in the 22/23 budget process. Going forward, the Council was in a much stronger financial position than it expected 12 months ago.
Councillor Cook, in conclusion, referred to the financial support from the Government, which he said had been extensive; however, the prudent management of the support had been key in delivering this extremely welcome outcome; he referred to the most difficult financial circumstances one could imagine, and a very firm financial ethos being maintained. Councillor Cook, joined by all members, commended the outstanding work of the Financial Services Team.
The Leader also gave his thanks, not only to the Financial Services Team, but also to the Cabinet Member with responsibility for Resources; he referred to the excellent outturn report, and not taking that for granted, it was exceptional and would allow ESC to deliver against its ambitious agenda over the next 12 months, and beyond.
The Cabinet Member with responsibility for the Environment gave thanks for the hard work undertaken and stated that this would help the Environmental Team to implement policies going forward.
The Deputy Leader also gave his thanks and he referred to the Assets and Economic Development Teams being able to make acquisitions that had enabled further income to come into the Council. The Deputy Leader also referred to the grants that had been given and the speed at which the grants had been processed.
Councillor Byatt, after giving thanks for the excellent report, asked a number of questions; he asked how Council Tax and Business Rates arrears were affecting the Council; he also referred to the money that had been saved in travel costs and asked if some of the savings could be put towards additional electric charging points at the Council offices. Councillor Byatt also referred to income from the Port of Felixstowe and asked if the knock on effect of the shortage of lorry drivers affected the operations of Felixstowe and associated ESC income. Finally, Councillor Byatt referred to the bid of £5,000 for Member training, and slippage, and he asked about Member training in respect of new Planning arrangements.
In response to the questions asked by Councillor Byatt, Councillor Cook advised that he would be presenting a report to Full Council which would cover Council Tax and Business Rates arrears, and he commented that no doubt the Cabinet Member with responsibility for the Environment, together with the Environment Task Group, would be considering additional electric charging points. Referring to the shortage of lorry drivers, Councillor Cook advised that, potentially, this would affect the transport industry and ESC would react accordingly. In conclusion, Councillor Cook acknowledged the importance of Member training and the investment of this. The Leader referred to one of the impacts of the exit from the EU, and the increase in work by Port Health, and he acknowledged that that came at a cost to the importers, hauliers, companies and central government; the Leader stated he too had concerns around the employment of drivers, and he also had concerns around general employment in a number of sectors. The Leader referred to all that ESC could do to promote people moving to, and coming to East Suffolk, to work, to live, and to resettle, would only be positive because with those people would come a workforce and that workforce would need homes and facilities etc.
On the proposition of Councillor Cook, seconded by Councillor Rivett, it was by unanimous vote
RESOLVED
1. That the Council’s draft outturn position for 2020/21 together with reserves and balances as at 31 March 2021 be noted.
2. That the transfers to and from reserves shown in Appendix C, including transfer of the £1.107m General Fund outturn surplus to the Transformation Reserve, be approved.