Agenda item

To accept the report on the end of August 2021 review of the Revenue Budget, and consider the latest financial position regarding the budgets of each department / service.

It was noted that the financial impact of Covid-19 remained in 2021/22, which was a combination of additional costs, income losses and a slippage in the savings programme, as the Council had given priority to protecting the health and lives of the people of Gwynedd in response to the crisis.

It was noted that the Welsh Government's Covid support system via the hardship fund continued, but this did not address overspend because of slippage in the savings programme.

It was noted that there was significant overspend in the Adults, Health and Well-being 

Department and the Highways and Municipal Department this year, whilst there was a marked improvement in the projections for the Children and Families Department.

The following recommendations and financial virements (as outlined in Appendix 2) were approved.

• On Corporate budgets, that:

¾    An underspend of (£285k) relating to capital costs is earmarked to a fund to finance the capital programme.

¾    A net underspend of (£1,957k) on Corporate budgets goes to the Financial Strategy Support Fund to assist in dealing with the financial challenges facing the Council, particularly so due to the Covid crisis.

The item was presented by Cllr Ioan Thomas.

RESOLVED

To accept the report on the end of August 2021 review of the Revenue Budget, and consider the latest financial situation regarding the budgets of each department/service.

It was noted that the financial impact of Covid-19 continued in 2021/22, which was a combination of additional costs, income losses and a slippage in the savings programme, as the Council had given priority to safeguarding the health and lives of the people of Gwynedd in response to the crisis.

It was noted that the Welsh Government's Covid support system via the hardship fund was continuing, however, it did not address overspend due to a slippage in the savings programme.

It was noted that there was significant overspend in the Adults, Health and Well-being Department and the Highways and Municipal Department this year, whilst there was a significant improvement in the projections of the Children and Families Department.

The following recommendations and financial virements (as outlined in Appendix 2) were approved.

• On Corporate budgets, that:

¾      An underspend of (£285k) relating to capital costs was earmarked to a fund to finance the capital programme.

¾      A net underspend of (£1,957k) on Corporate budgets to go to the Financial Strategy Support Fund to assist with the financial challenges facing the Council, particularly due to the Covid crisis.

DISCUSSION

The report was submitted, noting that it detailed the latest review of the Council's revenue budget, along with the projections for the end of the financial year.  It was highlighted that there had been a significant financial impact on the Council as a result of Covid-19, with a combination of additional costs together with income losses.  It was explained that the Council made monthly applications to reclaim costs from the Welsh Government's Hardship Fund.

Back in January it was stated that measures had been taken to draft an amended programme of savings for 2021/22, however, it was explained that a delay in realising savings continued in some areas, with a delay as a result of the crisis an evident factor. 

Attention was drawn to the principal matters and it was noted that the department anticipated an overspend of £1.4 million in the Adults Department, with a failure to realise savings worth £855k being an obvious factor of the overspend. It was stated that Covid had had a substantial impact on the department and £1.3 million had already been claimed from the Welsh Government towards the additional costs for the period.

It was explained following the Council's decision to allocate £1.8 million in additional funding to the Children's Department in the 2021/22 funding cycle as well as abolish savings schemes to the value of £1.1 million it was highlighted that the current financial projections for the department were very promising. It was stated that overspending problems in the waste collection and disposal field continued in the Highways and Municipal Department. It was noted that there had been difficulties to realise savings in a number of areas to the value of £673k and the department had also faced additional costs responding to Covid, however, the Welsh Government had already provided compensation and it was expected that they would continue to provide compensation for the rest of the year.

It was noted that corporately there were prudent projections when setting the 2021/22 budget that were responsible for additional tax outputs and contributed to the underspend on Council Tax Reductions. The decision was noted.

Observations arising from the discussion:

¾     The Head of the Finance Department explained that Government grant funding had not been predicted last year, however, this had been done this year, and as a result on the whole the situation was generally satisfactory. 

¾     The Head of the Finance Department added that savings needed to be delivered, however the situation of two departments were difficult this year. 

¾     It was stated that in terms of the Adults Department the department had been under pressure as a result of intensive care cases together with working under the conditions of Covid. It was noted that work had been undertaken last year to claim costs, together with the receipt of late grants.

¾     It was stated that in the Highways and Municipal field there had been an increase in the waste collected together with adaptations to the service as a result of Covid regulations.  Concern was highlighted about staff sickness, together with loss of income for the department, and it was noted that work was being undertaken to find a substantial sum of money.

¾     Gratitude was expressed on behalf of the Children and Families Department that the End to End savings scheme had been abolished, and as a result the department's financial position was satisfactory this year.  

¾     It was highlighted that there was concern regarding the Education Department's transport costs, and the post-16 provision needed to be looked at.