Agenda item

LIST OF BACKGROUND PAPERS AS REQUIRED BY LAW

(Papers relied on the write the report and which do not contain exempt information)

Contact Officer, telephone number and email: Lucy Hume, 01263 516246, Lucy.Hume@north-norfolk.gov.uk

To recommend the following to Full Council:

a)  The provisional outturn position for the General Fund revenue account for 2020/21;

b)  The transfers to and from reserves as detailed within the report (and appendix C) along with the corresponding updates to the 2021/22 budget;

c) Allocate the surplus of £752,223 to the Delivery Plan Reserve;

d)  The financing of the 2020/21 capital programme as detailed within the report and at Appendix D;

e) The balance on the General Reserve of £2.326 million;

f)  The updated capital programme for 2021/22 to 2024/25 and scheme financing as outlined within the report and detailed at Appendix E;

g)  The outturn position in respect of the Prudential Indicators for 2020/21 as detailed in Appendix F and;

h) The roll-forward requests as outline in Appendix H are approved.

Reasons for the recommendations:

To approve the outturn position on the revenue and capital accounts used to produce the statutory accounts for 2020/21.

The Portfolio Holder for Finance & Assets, Cllr E Seward, introduced this item. He said that the report provided a final budget monitoring position for the 2020/21 financial year. It showed an overall underspend of £752,223, allowing £255,917 from budget and grant underspends to be rolled forward within earmarked reserves to fund ongoing and identified commitments for which no budget had been allocated in 2021/22.

Cllr Seward said that the surplus showed that the Council was soundly managed and emerging from the pandemic in a good financial position. He thanked the Finance Team and the Revenues and Benefits team for their hard work.

He summarised key points from the report. Regarding the Council’s operating costs against the budget, he said that there was an adverse balance of just over £1m but this had been more than compensated for by not having to borrow money, which had been anticipated for the waste vehicles contract and the new leisure centre. Instead, the amount income coming in meant that this had not occurred.

Regarding the business grants collection fund, Cllr Seward said that this had exceeded expectations. Due to the number of small businesses in North Norfolk which were entitled to rate relief, this income then came straight to the Council.

He then spoke about the Fees and Charges compensation scheme which covered loss of income from the Council’s car parks and leisure centres, explaining that this had also brought in further funds. All of this additional funding had been allocated to the Delivery Plan Reserve, to be spent on projects for the District and its residents.

Cllr Seward concluded by saying that the Council, like many others, had received financial assistance from the Government during the pandemic, adding that unlike a lot of local authorities which were now facing a dire financial situation, NNDC was not. He referred to the challenges of budget forecasting, using the example of the Budget of February 2019 as an example. At that time, there had been a forecast deficit of £2m for 2021, yet there was now a surplus of  £0.75m. One of the biggest, ongoing challenges that the Council faced was the uncertainty over future Government funding. If it stayed as it currently was, then the Council could maintain its services.

Cllr C Cushing asked how much funding the Council had received from the Government in the previous financial year. The Chief Technical Accountant replied that Covid grant funding had totalled £1.7m (in four tranches) with a further £700k to cover lost fees and charges. Cllr Cushing said that it would be appropriate then for the Council to thank the Government for its support. He then referred to Cllr Seward’s comments about the forecast deficit of £2m and asked what work was being undertaken to understand how forecasting and projections could be improved for the future.

Cllr Seward said that in terms of central government support, it was assumed that this would fall away and therefore there was a very cautious approach going forward. The Chief Technical Accountant added that it was very hard to forecast even one year ahead and as yet there was no clarity regarding future funding streams. The business rates retention scheme was also currently under review and this, together with the business rates revaluation programme, was causing uncertainty from April 2022 onwards. In addition, it was possible that many of the non-ringfenced grants such as New Homes Bonus and the Rural Delivery Grant, may not continue. Consequently, the Finance Team took a cautious approach in their estimates, particularly regarding grant income. They worked with funding advisory services which helped provide a steer and shared information with peer groups.

The Leader, Cllr S Butikofer, said that Cabinet also asked the same questions of the Finance team and that for anyone from the commercial sector, local government funding was a difficult subject to understand.

Cllr J Rest referred to page 35 of the report and the allocation of £0.75m to a special reserve. He asked for more information on this. Cllr Seward replied that this was the Delivery Plan Reserve. The funding had been allocated to this reserve and would be earmarked for future investment in North Norfolk.

Cllr L Shires referred to page 81 and the second homes council tax. She said that it did not make it clear that this had now been withdrawn and suggested that future reports should be updated to reflect this.

Cllr J Toye thanked everyone for their hard work in preparing the report.

It was proposed by Cllr E Seward, seconded by Cllr L Shires and

RESOLVED

To recommend the following to Full Council:

a)  The provisional outturn position for the General Fund revenue account for 2020/21;

b)  The transfers to and from reserves as detailed within the report (and appendix C) along with the corresponding updates to the 2021/22 budget;

c) Allocate the surplus of £752,223 to the Delivery Plan Reserve;

d)  The financing of the 2020/21 capital programme as detailed within the report and at Appendix D;

e) The balance on the General Reserve of £2.326 million;

f)  The updated capital programme for 2021/22 to 2024/25 and scheme financing as outlined within the report and detailed at Appendix E;

g)  The outturn position in respect of the Prudential Indicators for 2020/21 as detailed in Appendix F and;

h) The roll-forward requests as outline in Appendix H are approved.

Reasons for the recommendations:

To approve the outturn position on the revenue and capital accounts used to produce the statutory accounts for 2020/21.