Agenda item

Dewi A. Morgan, Head of Finance (CJC’s Statutory Finance Officer) and Sian Pugh, Assistant Head of Finance to present report.

·       To note the Growth Deal’s out-turn position for 2025/26 noting that, due to the underspend, £60,990 of the earmarked reserve would not be used, and that a smaller amount of £867,731 would be used from the North Wales Growth Deal grant, to show a neutral position for the year.  

 

·       To note the Growth Deal's reserves position.

 

·       To note the Growth Deal’s capital end of year review as of 31 March 2026.

 

·       To note the Investment Zone's out-turn position for 2025/26.

 

·       To note the Regional Skills Partnership’s out-turn position for 2025/26.

 

The report was presented by the Assistant Head of Finance

 

DECISION

 

·       To note the Growth Deal’s out-turn position for 2025/26 noting that, due to underspending, £60,990 of the earmarked reserve would not be used, and that a smaller amount of £867,731 would be used from the North Wales Growth Deal grant, to show a neutral position for the year.  

 

·       To note the Growth Deal's reserves position.

 

·       To note the Growth Deal’s capital end of year review as at 31 March 2026.

 

·       To note the Investment Zone's out-turn position for 2025/26.

 

·       To note the Regional Skills Partnership’s out-turn position for 2025/26.

 

REASONS FOR THE DECISION

 

To inform the Economic Well-being Sub-committee of the financial positions of the Growth Deal (including the Shared Prosperity Fund and Local Area Energy Plan), Investment Zone and Regional Skills Partnership for both revenue and capital in 2025/26.

 

DISCUSSION

 

The members were guided through the revenue and capital position for the Growth Deal, the Investment Zone and the Regional Skills Partnership for the 2025/26 financial year.

 

Final Net Out-turn Position

It was reported that the final net out-turn position was an underspend of £543,000, with the main underspend stemming from the 'employees' heading. It was elaborated that around £90,000 of this underspend was due to staff working a proportion of their time on the Corporate Joint Committee, £39,000 related to staff working on the Regional Skills Partnership and £156,000 related to staff that were funded by Growth Deal projects. It was confirmed that vacant posts had led to an underspend of around £255,000.

 

It was also noted that there was an underspend against the 'additional government roles' heading because, although appointments had been made during the year, it was explained that they were funded from the Resources Reserve therefore the budget of that fund had been adjusted to match the underspend. Reference was also made to an underspend of £181,000 on the supporting expenditure for projects.

 

It was highlighted that the main income streams for the year were: partner contributions, the North Wales Growth Deal grant, the Welsh Government energy grant, the Shared Prosperity Fund, the Earmarked Reserve and the Resources Reserve. The members were reminded that partner contributions were the only permanent source of funding for the Corporate Joint Committee and amounted to 20% of the full budget. It was reported that the contributions from partners had been approved as part of the Delivery and Funding Agreement by all relevant partners.

 

Reference was made to short-term funding sources such as the Growth Deal Grant. It was explained that half of the money received as part of this grant had been allocated to revenue expenditure, noting that it had already been used in the first five years of the programme – with 10 years remaining. The importance of a diversity of funding sources for the future was emphasised.

 

Use of this underspend was being considered to leave a neutral position at the end of the year. It was noted that this could be done by reducing the contribution from the Growth Deal grant from £1,350,000 to approximately £868,000 and not using the Earmarked Reserve of £61,000. It was explained that these sources would be used to fund expenditure within subsequent years and would reduce the risk of needing to increase partner contributions in the near future.

 

Reserves

The movement in reserves during the year was reported, including the balances of those funds at 31 March 2026.

 

The Officer reminded everyone that an Interest Reserve of approximately £5 million had been set aside to fund borrowing costs in the coming years, noting that this balance had been taken into account when calculating the partners' borrowing costs in the 2026/27 financial year budget.

 

The balance of the Resources Reserve was confirmed to be £4.4 million at 31 March 2026, reporting that around £1 million had been earmarked for use in the 2026/27 budget.

 

Growth Deal's Final Capital Position

It was reported that £30.64 million of expenditure had been made on the Growth Deal by the end of the 2025/26 financial year. It was noted that this was a net reduction of £14.28 million compared to the budget approved in February 2025, following a slippage on projects. However, it was noted that expenditure on the Cydnerth project had been made earlier than forecast, with £8.87m showing under the 2025/26 expenditure rather than between two financial years as had originally been profiled. It was confirmed that the Growth Deal budget allocated for revenue expenditure in 2025/26 had been reduced to £0.87 million to reflect the final revenue out-turn figures.

 

Investment Zone's Actual Expenditure and Income

It was explained that expenditure of around £323,000 was noted against Flintshire and Wrexham County Council on the documentation, but following more recent information, it was confirmed that this figure would be adjusted to £230,000 by the time the information was submitted finally for approval. It was mentioned that the original figure included £93,000 of commitments which would be shown as part of 2026/27 spending. The Officer elaborated that the sum of Investment Zone Grant used would also be adjusted to reflect this, so that it would not affect the net position for the year.

 

The Regional Skills Partnership

It was confirmed that the partnership's financial situation showed a neutral position for the year, with expenditure of £290,000 being funded by Welsh Government grant funding.

 

It was confirmed that the information presented within this report would be submitted to the Governance and Audit Sub-Committee on 4 June before final approval by the Corporate Joint Committee on 19 June.

 

During the discussion, the following observations were made:-

 

In response to an enquiry, the Assistant Head of Finance confirmed that underspend remained in reality, although a neutral position on the 2025/26 balances could be confirmed. However, she noted that this underspend of £543,000 enabled the financial sources identified within the report to remain available into the future.

 

The members expressed their thanks for the report.