Agenda item

The Finance Manager (S151 Officer) updated members on the financial position as at the end of September 2020 and presented details on the 2020/21 Projected Financial Outturn.

 

At the end of Quarter 1, the Finance Manager (S151 Officer) had forecast a breakeven position.  The current position was projecting a surplus of £642k. 

 

The Finance Manager (S151 Officer) highlighted the income which was specifically related to Covid-19, stating that Torridge had a good year financially.   

 

·      To date, Central Government had funded 4 tranches of general Covid support grant, amounting to £1,187,000; other Covid “new burden” funding, amounting to £208,000 for the administration of business support grants for example; and compensation for lost fees and charges will be received, which will cover approximately 75% of fees and charge which have been lost. 

 

·      There had been an unprecedented increase in the number of planning applications

 

·      Recycling income had been underestimated by £72,000.  It was noted that, as the contract was between Devon County Council and the service provider and the details thereof were not available to Torridge District, budgeting for recycling income could only be done by estimate. 

 

Adversely, losses had been incurred in areas such as parking income, income from treasury deposits, leisure services and council tax and business rates.  Unexpected costs had been incurred in relation to Torrington pool roof repairs and reduced capacity at the hostels due Covid restrictions and delays in renovating the hostel site in the High Street.

 

A summary of business as usual variances was presented illustrating income versus expenditure.

 

Some of the factors which had led to the projected surplus included:

 

•      Staycation – bounce back of car parking income

•      Low incidence of Covid-19 – relatively insignificant agency backfill for frontline staff

•      Explosion of planning Income

•      Buoyant property market – strong recovery in land charge income

•      Stability of the Council’s commercial income

•      Very low increase in claims for local council tax support

 

The Finance Manager (S151 Officer) made members aware that there was a shortfall of £5million in the capital programme.  It was anticipated that the second Covid-19 lockdown will impact on the finances and posed many uncertainties.

 

It was noted that monthly returns on the impact of Covid-19 are submitted to the

MCHLG and it had been put on record that the grants will not be ringfenced and

clawed back.

 

The Chief Executive referred to the ”new burden” grants, adding that staff had worked conscientiously to get everything in place as required to support the new schemes within a short timeframe and that this had averted the need to bring in agency staff, thus keeping cost low.  He told members that, if they were to make the recommendation that the surplus of £642,000 be transferred to capital reserves, the money could be reallocated if required at a future date.

 

In response to a question about financial savings in respect of vacancies, the Chief Executive explained that some of the vacancies had been planned and were in relation to the restructure and recruitment was underway for others. 

 

Councillor Laws commended the well managed budget.

 

The Questions and Answers document was reviewed.  Additional information was provided as follows:

 

Page 19 Highlights – Budget monitoring

 

A verbal update was provided by the Finance Manager (S151 Officer).  When the budgets were set in February 2020, officers had looked forward to the financial pressures of the medium term, up to 2024/25, which had projected a funding gap for the year 2021/2022 of £259,000.  The forward projections included assumptions such as council tax increase, the amount of central Government funding, pay award inflation and pensions contributions.  Generally, in November the medium term projection is revised as it ties in with the Government’s spending review.  By December, the picture will be clearer as to how much Government grant funding will be available.  Moving forward an option might be to show, at the time of the QBR3 review, what the previous medium term strategy had shown for the financial year

 

Page 22 - Investments

 

The Finance Manager (S151 Officer) advised that more detailed information relating current investment holdings could be included in the QBR.  He gave an overview of the current position: £17million was currently held in short term treasury deposits, £14million of which was with instant access or 32-day notice accounts and £3million was due back in January.  Of the £34million received for business support grants at the start of the pandemic, approximately £27million had been paid out and the difference could be clawed back by central Government at any time.  Interest rates were currently so low that the difference between short term and longer term accounts was marginal.

 

A breakdown of current investment holdings will be circulated to members.

 

Page 23 TDC 2 – Inward Investment / Investment in Growth – Action ER4

 

Mr Harper raised concern as to whether Torridge District Council had its own

particular strategy, outside of the northern Devon Strategy, in relation to

Covid-19 and businesses.  The Chief Executive responded that the Torridge plan cascaded into the northern Devon and wider Devon Plan.  Working more closely with North Devon as a northern Devon economic area added more weight to applications for funding, particularly through the LEP and Government departments.

 

Page 24 - TDC3 - Harbour Review – Action H1C

 

Mr Harper commented on the Fishdock deficit of £55,631 questioning the viability of the contract.  The Finance Manager (S151 Officer) acknowledged that the business would not break even, however, it had been taken on following the collapse of the co-operative which previously ran it and perhaps should be considered for further scrutiny as an economic regeneration project.

 

Page 27/28 - Measure LE546 End to End time for processing Disabled Facility Grants

 

The Chief Executive confirmed recruitment was underway to enable this process to be brought back in house.

 

Page 28 - Housing - We must do something to ensure there is more social housing available for all.

 

The Chief Executive gave an update on the Strategic Plan and the work being carried out to address the responses to the consultation and to produce a delivery plan.  He told the meeting that he and the Leader had met with the Chief Executive of Westward Housing and P Clarke of the LGA and started to investigate the options for pulling this piece of work together.  A report will be presented to a future Full Council meeting.

 

Page 30 - Benefits Claims Processing Times

 

Further to the additional paper submitted by the Housing Benefits Team Leader, the Finance Manager (S151 Officer) explained that the software provider had had to change and test software in response to the Government enhancing the local housing allowance.  The benefit recipient had in fact already received the benefit but without the enhancement.  Hence, the delay was only in paying out the enhancement.

 

TDC6 - Waste Review – Action W1.C

 

Councillor Hames asked whether there was an opportunity for councillors to be engaged in the consultation on the County Waste Strategy.

 

Action: To be confirmed with Operational Services Manager

 

Page 36 - Measure LE701 End to End Times for Property Searches

 

The Head of Legal & Governance (Monitoring Officer) gave an update, noting that there had been substantial increases in land charges enquiries and the turn-around time was currently 30 days.  To commit additional resource to this service was difficult as significant training was required.  Staff were working overtime.

 

It was proposed by Councillor Newton, seconded by Councillor Langford and –

 

Resolved:

 

That it be recommended to Community & Resources that the projected 2020/21 surplus identified of £642k is transferred to capital reserves recognising that the capital program is currently under funded by circa £5m

 

A recorded vote was taken.

 

COMMITTEE MEMBER	FOR	AGAINST	ABSTAIN
CLLR BOUGHTON, R	X
CLLR COTTLE-HUNKIN, C	X
MR S DENGATE	X
CLLR GUBB, J	X
CLLR HAMES, P	X
MR I HARPER	X
CLLR INCH, A
CLLR LANGFORD, S	X
CLLR MANLEY, J	X
CLLR NEWTON, S	X
CLLR WATSON, P	X

 

(Vote: For – unanimous)