Agenda item

(Cabinet Member with Special Responsibility Councillor Bryning)

Report of the Head of Financial Services

(Cabinet Member with Special Responsibility Councillor Bryning)

Cabinet received a report from the Head of Financial Services which provided summary information regarding the provisional outturn for 2010/11 and the timetable for completion of the closure of accounts process.  It also set out information regarding the carry forward of underspent/overspent revenue budgets and capital slippage for Members’ consideration, and sought approval of various Prudential Indicators for last year for referral on to Council.  The Treasury Management Outturn report (previously reported separately) was also included.

The options, options analysis, including risk assessment and officer preferred option, were set out in the report as follows:

The City Council has a legal requirement to ensure that its expenditure is fully funded and to produce a Statement of Accounts in accordance with proper accounting practice.  In addition, the Prudential Indicators are a statutory requirement linked to the budgetary framework.  For these aspects, therefore, there were no alternative options for Cabinet to consider.  Members were asked to endorse certain actions taken by the Head of Financial Services, however.  Cabinet were requested to consider whether it had sufficient information to do so or whether it required any further justification.  With regard to reserves contributions, there would be opportunities for these to be amended during the current financial year, as part of the usual arrangements.

The report requested Cabinet to consider a number of revenue budget carry forward matters and capital slippage.  The framework for considering these was set out in the report but basically Cabinet could:

-        Approve any number of the items / requests, in full or part.

-        Refuse any number of the requests and if commitments have already been incurred, require alternative funding options to be identified.  Cabinet was requested to note, however, that this might impact on other areas of service delivery.

-        Request further information regarding them, if appropriate.  Cabinet was asked to bear in mind any work required against the value of the individual bids.

Officer recommendations regarding any carry forward of overspendings were set out in Appendix F, to the report.  Where there were alternative options for other aspects of the outturn, in view of the comments made above there were no specific officer preferred options put forward.

Although 2010/11 has been an uncertain year financially, as at 31 March the Council had improved its financial standing overall by generating net efficiency savings and through other underspendings.  Balances were significantly higher than forecast.  Whilst there were still uncertainties surrounding the outcome of Icelandic investments, the Council had retained its provisions to cover ‘worse case’ estimated losses and therefore potentially there was scope for its financial position to improve further, should a positive ruling be forthcoming.  Looking forward, the Council had earmarked further reserves to help respond to the ongoing financial challenges expected over the coming years.  Given funding prospects the Council must continue to reduce costs wherever possible – substantially more efficiency and other savings initiatives would be needed in future in order to ensure a balanced annual budget and financial stability.

Councillor Bryning proposed, seconded by Councillor Smith:-

“(1)      That the recommendations, as set out in the report, be approved.”

Councillors then voted:-

Resolved unanimously:

1.      That the provisional outturn for 2010/11 be noted.

2.      That Cabinet notes the transfers to provisions and reserves actioned by the Head of Financial Services as set out in section 4.2 of the report.

3.      That Cabinet approves the recommendations regarding carry forward of overspendings as set out at Appendix F in the report.

4.      That Cabinet approves the requests to carry forward underspent General Fund revenue budgets numbered 1 to 14 and the Housing Revenue Account request numbered 19 all as set out at Appendix G, with referral on to Council where appropriate.

5.      That Cabinet approves the remaining General Fund carry forward requests numbered 15 to 18, which involve some change of use from the original budget purpose, with referral onto Council where appropriate.

6.      That Cabinet approves the requests for capital slippage as set out at Appendix J.

7.      That the timetable for completion and reporting of the closure of accounts be noted, as set out in section 8 of the report.

8.      That the Annual Treasury Management report as set out at Appendix K be noted and referred on to Council.

9.      That the Prudential Indicators as at 31 March 2011 as set out at Appendix L be approved for referral on to Council.

Officers responsible for effecting the decision:

Head of Financial Services

Reasons for making the decision:

The City Council has a legal requirement to ensure that its expenditure is fully funded and to produce a Statement of Accounts in accordance with proper accounting practice.  In addition, the Prudential Indicators are a statutory requirement linked to the budgetary framework.  The decision enables Members to endorse certain actions taken by the Head of Financial Services, and, with regard to reserves contributions, there will be opportunities for these to be amended during the current financial year, as part of the usual arrangements.