Agenda item

(To receive a report from the Executive Director – Resources, which describes the Council's financial performance in 2019/20 and reports on underspends on budgets and makes proposals on the carry forward of over and under spends into the current financial year 2020/21)

(1)  That the carry forwards set out in paragraphs 1.145 to 1.147 of the report, which are made in line with the Council's Financial Regulations, be noted.

(2)  That it be recommended to the County Council that the proposals in paragraphs 1.148 to 1.150 of the report, relating to the treatment of underspends in excess of 1%, be approved.

(3)  That the transfers to and from reserves carried out in 2019/20, as set out in Table E of the report, be noted.

(4)  That the financial performance in 2019/20, as set out in Table A (Key Financial Performance Measures), Table B (Revenue Budget Final Outturn), Table C (Net Capital Programme Summary Outturn), Appendix B (Prudential Indicators) and Appendix C (Flexible Use of Capital Receipts) of the report, be noted.

Consideration was given to a report, which was presented by the Executive Director - Resources and Assistant Director – Strategic Finance, on the Council's financial performance in 2019/20, which included an overall underspend of £15.140 million on Council's budgets and an underspend of £11.958 million on schools' budgets.  The underspend on schools' budgets are retained by each school.  The report also identified and explained the variances from the Council’s revenue and capital budgets; and how flexible capital receipts of £8 million had been planned to be used to fund revenue expenditure on transformation during the years up to and including 2019/20.  Prudential and financial performance indicators for 2019/20 were also included.

Proposals for the use of underspends, which were in excess of 1% of the approved budget from 2019/20, in the current financial year (2020/21) were set out in paragraphs 1.148 – 1.15 of the report.  These would be submitted to the County Council for approval. 

The Chairman of the Overview and Scrutiny Management Board presented the comments from the Board, which had included reference to the overall underspend in Adult Care and Community Wellbeing commissioning strategies; to compensation payments on the A1073; the overspend of £2.373 million on the home to school/college transport budget; the purpose of the Council's contingency budget of £3 million; and slippage on the capital programme.  

The Leader of the Council referred to anticipated pressures on the Council's budget during 2020/21, for example, the potential for inflation arising from the procurement of services, particularly for home to school/college transport.  The emphasis of capital programme funding would be on the delivery of the Council's preferred schemes, and if other schemes were to be substituted to take up slippage, there would be a risk that funding would not be available for the preferred schemes.  The purpose of the contingency budget would be reviewed during the course of the year.

The following issues were raised:

• On home to school/college transport, although social distancing would not be required from September 2020, there remained a possibility that the awaited government guidance could require pupils to travel in their 'bubble'.
• There was a pressure on bus companies arising from their reduced income during the pandemic.
• On the proposal to allocate funding to a corporate transformation reserve, plans on how this money would be used would be submitted as soon as possible.
• Lincolnshire County Council had been given a grant of £35 million by the Government to aid its response to the Covid-19 pandemic, with expenditure and lost income to date totalling approximately £47 million, which did not take into account any future losses arising from reduced Council Tax or Business Rate income.  A further £500 million had been awarded by the Government, and the Council's share of this would be confirmed shortly.  The Government had also announced plans for compensating local authorities for lost income, again with details due to be confirmed shortly.       

RESOLVED

(1)         That the carry forwards set out in paragraphs 1.145 to 1.147 of the report, which are made in line with the Council's Financial Regulations, be noted.

(2)         That it be recommended to the County Council that the proposals in paragraphs 1.148 to 1.150 of the report, relating to the treatment of underspends in excess of 1%, be approved.

(3)         That the transfers to and from reserves carried out in 2019/20, as set out in Table E of the report, be noted.

(4)         That the financial performance in 2019/20, as set out in Table A (Key Financial Performance Measures), Table B (Revenue Budget Final Outturn), Table C (Net Capital Programme Summary Outturn), Appendix B (Prudential Indicators) and Appendix C (Flexible Use of Capital Receipts) of the report, be noted.