Agenda item

Report of the Executive Director of Corporate Resources and Customer Services

The Cabinet considered the report of the Executive Director of Corporate Resources and Customer Services indicating that to comply with statute, the Chief Financial Officer was required to report to Council prior to the approval of the budget and the setting of the Council Tax, to give assurance that the budget was robust and that there were adequate reserves and balances. 

The report also provided information on the following factors that had been considered:

·       Financial Environment for Local Government and Sefton MBC

·       Impact of previous years’ budget - 2020/21

·       Central Government funding

·       Maintaining service delivery

·       Inflation and annual cost increases

·       Financial management

·       CIPFA Financial Resilience Index and the CIPFA Financial Management Code

·       Management of risk

·       Capital Strategy and Strategic Investment

·       External advice

·       Reserves Strategy for 2021/22 

The report concluded that as a result of considering the issues contained within the report, it was the view that the budget proposed was a robust budget package and the opinion provided was in accordance with Section 25 of the Local Government Act 2003.

The Executive Director of Corporate Resources and Customer Services highlighted the challenges of developing and setting a budget during an ongoing pandemic and further highlighted the impact and consequences of the pandemic on the Councils budget in future years.   The Executive Director of Corporate Resources and Customer Services emphasised the importance of having a degree of flexibility within the budget for in year spend.

The Cabinet Member for Children’s Services and Safeguarding, Councillor J. J. Kelly thanked the Executive Director for his detailed report and asked if the full cost of the pandemic had been met by the Government as promised back in April 2020.

The Executive Director responded that the full cost of the pandemic had not been met by Central Government and that Central Government had provided the Council with just over £23m of emergency funding in 20/21 with also some flexibility around the collection fund in both the current year and next year being provided but not all costs or loss of income would be met.  He further reported that an example of how the impact of COVID was to be met by the council and central government was that Central Government had developed a cost sharing mechanism which meant that 75% of losses from fees and charges were being met by Government with the Council absorbing the remaining 25% after a 5% top slice had been applied.

The Executive Director further reported that the cost sharing mechanism was scheduled to continue into quarter one of the next financial year and emphasised that the longer-term impact of the pandemic on the Councils Budget would continue in future years.

The Cabinet Member for Regulatory, Compliance and Corporate Services, Councillor Lappin thanked the Executive Director and his team for all their hard work at such a challenging time highlighting that the complexity of the report illustrated the difficulties the Council had and would continue to navigate in future years.

Councillor Lappin referred to the budget and more specifically the Council reserves, she explained that the Council were required to hold a minimum amount of reserves within its budget and that it was expected that the Council reserves would increase year on year.  Councillor Lappin emphasised that using Council reserves as part of budget spend was neither an option or best practise in financial management.

Decision Made:

That the Council be recommended to:

Reasons for Decision:

The Local Government Act 2003, (section 25 as amended) requires the Chief Financial Officer to report formally on the issues contained within this report.

Alternative Options Considered and Rejected:

None.