Agenda item

2019-2020 Annual Accounts and Outturn

Report of the Executive Director, Finance and Resources


3.1      The Committee considered a report setting out the Council’s 2019/20 outturn position for revenue and capital for the General Fund (GF) and Housing Revenue Account (HRA). In addition, the report also provided a summary of the pension fund and the Council’s treasury management for the year. The Committee also considered the 2019/20 statement of accounts and a summary of these accounts. It was noted that the statement of accounts were currently at the draft stage with an audited version of the accounts due to be presented to the Committee at its July 2020 meeting for final sign off. This would be after the public inspection period which was due to end on 1 July 2020.


3.2      Gerald Almeroth (Executive Director of Finance & Resources) and RikinTailor (Head of Corporate Finance) provided the Committee with a detailed commentary of the following key sections of the financial statements.


·         The Committee was informed that the General Fund revenue position had seen a net outturn of £530,000 underspend compared to a Period 10 (January 2020) forecast underspend of £2.643m. It was explained that the majority of this movement was due to income losses as a result of the covid-19 pandemic. The revenue underspend would increase the Council’s general reserves to £63.306m which would assist the Council’s financial resilience, especially to deal with the financial pressures that would result from covid-19.


·       It was explained that the HRA revenue outturn was a surplus of £131,000, against a budgeted surplus of £9.793m. HRA revenue balances had increased by the surplus to £17.365m.


·       The general fund capital outturn represented a gross expenditure underspend of £71.527m against budget. This compared to a gross expenditure budget of £235.211m. The HRA capital outturn had a variance of £31.721m against a budget of £149.854m.


·       The total value of the Pension Fund as at 31 March 2020 was £1.324bn. This was made up of investments in various assets – 66% equities, 23% bonds, 10% property, 1% infrastructure.


3.3      The Committee held a detailed discussion on the report and noted that the accounts were currently at the draft stage. A concern was raised over the capital programme which was experiencing delays and represented a significant underspend. The Committee commented that this appeared to be a generic issue which had occurred before and questioned if there were linkages between capital programme execution issues and revenue issues. In response it was explained that there was a significant underspend in capital schemes however the majority of the slippage only related to a few large schemes which accounted for 60% of the total slippage in the programme leading to this variance.


3.4      The Committee discussed elements of the general fund revenue underspend and the reasons for the number of variations. It was explained that in terms of capital schemes causing delays in revenue, medium term financial planning had been undertaken including an assessment into how the capital programme fed into that in order to put in an allowance around timings for capital schemes. If there were delays in certain capital schemes and the Council was due to get a saving these and any revenue implications related to the capital scheme would not be recognised until the year after that capital scheme was completed. Therefore, it would be able to budget for such a scenario well in advance. In terms of the HRA and the major works income the Council was not able to bill leaseholders for major works until the work had been completed. The delay in these works had meant that the income would not be received in the year it was expected but would be received going forward however later than planned.


3.5      In response to a question over the size of the pension fund the Committee was pleased to note that as of 21 March 2020 the pension fund had a 97.2% funding level.


3.6      The Committee held further detailed discussions on the report. The Chair expressed concern over what appeared to be a persistent issue in regard to the capital programme execution and the current amount of slippage. In addition, some of the variances in the revenue areas was queried and it was suggested more information was required on the reasons behind why they were occurring. It was requested that the Committee receive a formal response to these concerns raised.


           RESOLVED: That the draft 2019/20 statement of accounts subject to the public inspection period and the audit currently underway be approved.




1.      An update be provided on the capital programme execution and the current amount of slippage. This to include details of how the current underspend compares to the previous five years.


2.      In the revenue outturn more it was requested that further information be provided with regard to the waiver of the Westco contribution due to covid-19, leading to a £300,000 income loss for the Council.


3.      In terms of commercial waste, it was expected that this service would be affected by the covid-19 pandemic and it was requested that the commercial activity assessment being undertaken be shared with the Committee when completed.



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