Agenda item

To submit a report by the Director of Function (Resources)/Section 151 Officer.

The report of the Director of Function (Resources)/Section 151 Officer setting out the

Council’s financial performance to date and expected outturn for 2021/2022 was presented

for the Executive’s consideration.

Councillor Robin Williams, Portfolio Member for Finance, Corporate Business and Customer Experience presented the report and said that on the 9 March, 2021, the Council set a net budget for 2021/2022 with net service expenditure of £147.420m, to be funded from Council Tax income, NDR and general grants.  This includes a total for general and other contingencies amounting to £1.333m.  The budget for the Council Tax Premium was reduced by £0.121m to £1.514m.  £0.300m was used from general reserves to ensure that a balanced budget was set with the agreed Council Tax rise of 2.75%.  Unlike previous years, the budget for 2021/2022 does not include any requirements on the services to make savings.  He further said that the reports sets out the financial performance of the Council’s services at the end of Quarter 4, 31 March, 2022.  This financial year, claims have been made in relation to the Covid crisis to the Welsh Government, which totalled £6.135m, with £3.854m having been received.  The Welsh Government has stated that no further funding will be released to cover the loss of income going into the new phase of the Covid pandemic.  The overall financial position for 2021/2022, including Corporate Finance and the Council Tax fund, is projected underspend of £4.798m.  This is 3.25% of the Council’s net budget for 2021/2022.  The Portfolio Member expressed that it is impossible to predict as to the challenges that will be faced during the current financial year together the increasing challenges with increasing costs and work is being undertaken by the Finance Department as to the possible effects that is likely to be faced.

The Director of Function (Resources)/Section 151 Officer said that the 2021/22 financial year was an exceptional year due to the Covid pandemic which had an impact on the Council’s work especially during the Q1.   He referred to the underspend as noted in the report and said that grants were received from Welsh Government towards services and especially Social Services to assist in the pressures faced within the service. The usual RSG grant was received by Welsh Government together with an additional grant at the end of the year of £1.4m as was received by every other local authority in Wales and this has contributed to the underspend within the budget.  The Director of Function (Resources)/Section 151 Officer further said that the borrowing costs has decreased due to the underspend in the capital budget and the Council Tax premium has been higher than the targets which has also contributed to the underspend in the budget together with vacant posts in the authority and income received especially in the Maritime Service during the Summer of 2021 due to the increase in visitors to the Island.  The income from planning and recycling fees have also contributed to the underspend especially during the last quarter.  The general balances are still around £12m after spending £3m in different projects as in noted within the report.  The schools balances have also increased from £3.9m to £7.8m. 

The Director of Function (Resources)/Section 151 Officer further said that a report will be submitted to the next meeting of the Executive in respect of the Council’s balances to explain as to why the Council is holding reserves. The 2022/23 financial year is facing increase in costs in different areas, and it is hoped that these reserves will be able to fund these increases.  It is anticipated that the 2023/2024 financial year will be challenging due to the increase in inflation but it will be dependent on the Welsh Government settlement for that year. 

Councillor Ieuan Williams referred that during the pandemic Welsh Government afforded grants but £1.8 m is still outstanding, he questioned whether this grant is to be paid in full as it notes in the covering report to the Executive that Welsh Government has stated that no further funding will be released to cover the loss of income.  The Director of Function (Resources)/Section 151 Officer responded that most of the £1.8m has been transferred to the Council.

The Leader of the Council said that it must be taken into account that without the grant funding from Welsh Government the Social Service budget would have overspend over £1m in the Adult’s Services and £0.5m within the Children’s Service together with homelessness pressures on the budget.

It was RESOLVED:-

·      To note the position set out in Appendices A and B to the report in respect of the Authority’s financial performance to date and expected outturn for 2021/2022;

·      To note the summary of Contingency budgets for 2021/2022 detailed in Appendix C to the report;

·      To note the position of the invest to save programmes in Appendix CH to the report.

·      To note the monitoring of agency and consultancy costs for 2021/2022 in Appendices D and DD to the report;

·      To note the schools balances in Appendix E to the report.