Decision details

Money Matters 2019/20 Position - Quarter 1

Decision Maker: Cabinet

Decision status: Recommendations Approved

Is Key decision?: No

Purpose:

This report provides an update to Cabinet on the county council's 2019/20 revenue and capital financial position as at the end of June 2019 and an updated Medium Term Financial Strategy (MTFS) covering the period 2020/21 to 2022/23. 

 

There is currently an unprecedented amount of uncertainty relating to future funding across local government. Accordingly significant assumptions are required to underpin our forecasts. While these can be made with reasonable confidence in the current year, over the medium term, with limited information, we rely heavily on advice from national bodies and discussion with peers. As a result of this uncertainty the MTFS has not, at this stage, been extended to 2023/24 as we would normally do.

 

The funding gap for 2020/21 has reduced to £5.895m. This is largely due to current information suggesting the continuation of the equivalent value of revenue support grant into 2020/21, although this remains to be confirmed. However the future forecast gap has increased to £64.755m by 2022/23 due primarily to increased pay costs and service demand pressures. Work continues to build on last year's service challenge work and a separate report is included on the agenda to address some of the outcomes from that initial phase 2 work.

 

In summary:

 

(i)  The 2019/20 revenue forecast outturn is £801.771m, representing a projected underspend of £0.506m (0.06%) of the agreed budget.

 

(ii)  The MTFS has been updated and revised upwards by £17.429m and now indicates a financial deficit of £64.755m in 2022/23.

 

(iii)The Council is forecast to hold a General Reserve against unforeseen issues of £23.437m representing c3% of net budget, which is unchanged from the previously reported position. 

 

(iv)The Council is forecast to hold £150.250m of uncommitted transitional reserve which is sufficient to meet the forecast gap through to 2022/23. 

 

Decision:

The Cabinet approved the recommendation(s) as set out in the report.

 

Date of decision: 05/09/2019

Effective from: 11/09/2019