Issue - meetings

Report of Chief Finance Officer

Lead Cabinet member: Councillor Stephen Holt

(Non-key decision):

(1) To note the initial financial impact of Covid-19 and associated vulnerability of the authority’s budget.

(2) To note the assumptions being made about the ongoing financial impact of Covid-19.

(3) To authorise the Chief Executive, in consultation with the Leader of Council, Cabinet member for Finance and the Chief Finance Officer, to make use of monies held in the Council’s Reserves as he believes most appropriate in order to continue essential service delivery and/or to mitigate the impact of the Covid-19 emergency on residents and/or service users.

The Cabinet considered the report of the Chief Finance Officer, updating them on the initial financial impact of Covid-19 and associated budgetary implications.

Visiting member, Councillor Smart, addressed the Cabinet on this item.

The Chief Finance Officer presented the report and made reference to the Council’s latest submission to the Ministry of Housing, Communities and Local Government (MHCLG), appended to the report.

The budget for 2020/21 was approved by Full Council in February 2020. The budget took into consideration that the Council no longer received any Revenue Support Grant and had to meet the cost of its services through locally generated income.

In addressing the economic slowdown last year due to factors such as the uncertainty over Brexit and increased demand for key services such as homelessness and housing need, the Council came up with further efficiencies, savings and income targets that formed part of the agreed budget for 2020/21. Although the targets set were challenging and robust, several reviews and risk assessments were carried out to ensure the budget set was fully tested and sustainable.

During the initial phase of the Covid-19 pandemic, the Council implemented a wide range of initiatives in order to support the most vulnerable in the Borough, working in partnership with the voluntary sector. Emergency response funding from central government to date had totalled £1.09 million.

The Council’s increased spending in response to the crisis and projected loss of income due to the pandemic had significantly impacted on the savings targets set in February. It was estimated that additional costs, including delayed savings programmes, arising from Covid-19 could be as high as £300,000 per week, should the lockdown continue and result in a long term economic downturn. It was stated that this was an approximate impact and worst case scenario.

The Chief Finance Officer re-assured the Cabinet that in terms of cash flow, the Council was currently in a robust and sustainable position. Subject to revised government measures being put in place, the council should avoid the need to borrow to support cashflow until the end of August at the earliest.

The Council would continue to internally review and closely monitor the financial position and look at ways to mitigate the impact of Covid-19 and engage with the MHCLG in partnership.

Resolved (Non-key decision):

(1) To note the initial financial impact of Covid-19 and associated vulnerability of the authority’s budget.

(2) To note the assumptions being made about the ongoing financial impact of Covid-19.

(3) To authorise the Chief Executive, in consultation with the Leader of Council, Cabinet member for Finance and the Chief Finance Officer, to make use of monies held in the Council’s Reserves as he believes most appropriate in order to continue essential service delivery and/or to mitigate the impact of the Covid-19 emergency on residents and/or service users.

Reason for decisions:

The Council’s response to Covid-19 has been and continues to be fast paced. Budgetary assumptions are liable to change and are only given as an indication. This report provides a  ...  view the full minutes text for item 71