Venue: Council Chamber - County Hall. View directions
Contact: Lisa Richards 01597 826371
Note: Joint with FSP
To receive apologies for absence.
Apologies for absence were received from County Councillors
DECLARATIONS OF INTEREST
To receive declarations of interest from Members.
There were no declarations of interest.
DISCLOSURE OF PARTY WHIPS
To receive disclosures of prohibited party whips which a Member has been given in relation to the meeting in accordance with Section 78(3) of the Local Government Measure 2011.
(NB: Members are reminded that under Section 78 Members having been given a prohibited party whip cannot vote on a matter before the Committee.)
There were no disclosures of party whips.
To consider the report of the Portfolio Holder for Finance.
· Report of the Portfolio Holder for Finance
· Financial Overview and Forecast as at 31 August 2018
· The Chair explained that he had called a joint meeting of the Audit Committee and Finance Scrutiny Panel regarding concerns that there was an overspend projected at year end. Any overspend affects the following year’s budget. Some services perform within budget others do not and this poses a real risk to the Authority. Ultimately the Committee need assurance that the budget is managed.
· The Deputy Chief Executive and Section 151 Officer had had discussions with the Chair regarding a comparison of the overspend at this point in time as compared with to the same period in the previous year.
· As at the end of August an overspend of £5.82M was forecast for year end. If this is the case at year end, the overspend will be met from reserves. The Deputy Chief Executive assured the Committee that the Authority would not go ‘broke’. However, the effect on the financial stability of the Authority in the medium term would need to be considered given the pressure faced by the Council.
· The overspend was remarkably similar to that forecast in August 2017. In the last financial year, the budget balanced at year end due to additional grant funding from the Welsh Government. By year end it had also been possible to make a contribution to reserves.
· The Committee questioned whether the Authority might find itself in a similar position at the end of the current financial year. There was some flexibility in that capital receipts could be used for revenue expenditure classified as ‘transformational’. This is a fundamental change to a key accounting principle. This could support issues around change, including redundancy costs and is available until the end of the 20121/22 financial year.
· The Council has reserves of £28.3M including specific reserves such as schools and the Housing Revenue Account (HRA)
· Members also questioned the additional contributions agreed to be made to the Pension Fund and what the likely effect on Council Tax would be
· The Portfolio Holder indicated that the level of Council Tax was still under consideration. There were no guarantees of additional funding from the Welsh Government and the Authority must remain prudent. Cash reserves were low as a decision had been taken to use cash reserves rather than borrowing to support the Council’s budget.
· The Deputy Chief Executive reminded Members of the difference between balance sheet reserves and cash reserves. It is likely that planned borrowing will recommence shortly. There would be no additional contributions to the Pension Fund until 2020. The Pension Fund is now 90% funded following gains on the stock market. A Triennial Actuarial Review was due next year to be implemented in 2020. Funding to the Pension Fund will be determined by the Actuary.
· It was confirmed that ‘The Floor’ was likely to be triggered this year – this ensures that there is a limit to the reduction in Welsh Government Funding in the settlement ... view the full minutes text for item 4.