Purpose of
Report
1.
To
report the final year end position for revenue and capital
expenditure against budget for the financial year
2020/21.
Strategic
Objectives
2.
The
allocation of financial resources within the revenue and capital
budgets needs to match the objectives agreed by the council.
The outturn report shows how these resources have been used in
year.
Background
3.
The
attached papers contain summarised schedules of revenue and capital
expenditure for 2020/21; they also present an explanation of the
significant variances against budget. This is presented by
service. All the figures in this report are pre-audit and may
be subject to some change following the conclusion of the audit of
the Statement of Accounts.
Revenue outturn
2020/21
4.
In
February 2020 the council approved a net expenditure budget of
£15.1 million which
was subsequently revised in October 2020 to £16.2 million.
The increase was funded from revenue reserves, primarily to
reflect the financial impact of the coronavirus pandemic.
This
includes costs incurred in supporting residents and businesses
affected by the pandemic, together with anticipated reductions in a
number of the council’s key income streams which had been
affected by the country going into lockdown.
The budget adjustments are shown as follows in table 1
below:
Table
1: Revised budget 2020/21
|
|
£000
|
|
Original
net expenditure budget 2020/21
|
15,121
|
|
Impact
of Coronavirus pandemic:
|
|
|
Additional
expenditure pressures
|
1,072
|
|
Additional
income pressures
|
2,653
|
|
Additional
grant funding
|
(3,144)
|
|
Other
revisions
|
475
|
|
Total
revisions
|
1,056
|
|
Total
revised expenditure budget 2020/21
|
16,177
|
5. The
budget was further amended to include one-off budgets that had been
carried forward from the previous financial year. With the
inclusion of budget carry forwards and other in-year changes, the
working budget for 2020/21 was increased to £21.9
million.
6.
Against
the working budget of £21.9 million net expenditure at year
end was £15.5 million. This equates to a favourable
variation of £6.4 million, which has been transferred to the
council’s reserves. Detail summary by service is shown
in table 2 below.
|
Table
2: summary of revenue budgets and variance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary
of revenue budgets and variance
|
Budget
£000
|
Actual
£000
|
Variance
£000
|
Notes
|
|
|
Strategic
Management Team
|
995
|
836
|
(159)
|
|
|
|
Corporate
Services
|
4,901
|
4,101
|
(800)
|
|
|
|
Development
& Regeneration
|
4,023
|
936
|
(3,087)
|
|
|
|
Finance
|
419
|
593
|
174
|
(a)
|
|
|
Housing
& Environment
|
7,185
|
5,941
|
(1,244)
|
|
|
|
Legal
& Democratic
|
1,086
|
977
|
(109)
|
|
|
|
Partnerships
|
3,369
|
3,221
|
(148)
|
|
|
|
Planning
|
2,253
|
976
|
(1,277)
|
|
|
|
Policy
& Programmes
|
706
|
534
|
(172)
|
|
|
|
Contingency
|
(3,017)
|
(2,589)
|
428
|
|
|
|
Service
Expenditure
|
21,920
|
15,526
|
(6,394)
|
|
|
|
Investment
Income
|
(2,583)
|
(2,474)
|
109
|
(b)
|
|
|
Net
Expenditure
|
19,337
|
13,052
|
(6,285)
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes:
a.
Finance line
contains housing benefits and rent allowances funded by government
grant as shown in table 3 below.
b.
The
council’s treasury management outturn report will be
considered by joint Audit and Governance Committee, Cabinet and
Council.
Table 3: housing
benefits and rent allowances
|
|
Budget
£000
|
Actual
£000
|
Variance
£000
|
|
Rent
allowance payments
|
18,228
|
20,380
|
2,152
|
|
Government
subsidy income
|
(17,780)
|
(19,628)
|
(1,848)
|
|
Rent
allowance overpayments
|
(449)
|
(740)
|
(291)
|
|
Net
Position
|
(1)
|
12
|
13
|
7.
Appendix 1 analyses income and expenditure across service
areas. This appendix shows that the expenditure budget was
£52.8 million compared to an actual spend of £50.7
million. This results in an underspend of £2.1 million,
around 3.9 per cent of total expenditure. The income budget
was £30.9 million compared to actual income of £35.2
million giving a favourable outcome in income of £4.3 million
or around 13.9 per cent.
8.
Table 4 below provides a further analysis of the revenue outturn
position.
Table 4:
variations between budgeted and actual revenue income and
expenditure
|
|
|
TRANSFERS
|
|
VARIANCES
BREAKDOWN
|
|
Service
|
Total
Variance
|
Under-spend c/fwd. to
2021/22
|
Grant
Income transferred to reserves
|
Net Variances after
Transfers
|
Employee
Costs
|
Other
|
|
£000
|
£000
|
£000
|
£000
|
£000
|
£000
|
|
Strategic
Management
|
(159)
|
163
|
0
|
5
|
30
|
(25)
|
|
Corporate
Services
|
(800)
|
170
|
0
|
(630)
|
(559)
|
(71)
|
|
Development
& Regeneration
|
(3,088)
|
2,816
|
275
|
3
|
59
|
(56)
|
|
Finance
|
174
|
17
|
0
|
192
|
69
|
123
|
|
Housing
& Environment
|
(1,244)
|
341
|
329
|
(573)
|
88
|
(661)
|
|
Legal
& Democratic
|
(109)
|
0
|
0
|
(109)
|
61
|
(170)
|
|
Partnerships
|
(148)
|
63
|
0
|
(85)
|
41
|
(126)
|
|
Planning
|
(1,276)
|
81
|
80
|
(1,115)
|
(251)
|
(864)
|
|
Policy
& Programmes
|
(173)
|
164
|
0
|
(9)
|
8
|
(17)
|
|
Contingency
|
428
|
0
|
0
|
428
|
78
|
350
|
|
Direct
Service Expenditure
|
(6,394)
|
3,816
|
684
|
(1,894)
|
(376)
|
(1,518)
|
|
Investment
Income
|
108
|
0
|
0
|
108
|
0
|
108
|
|
Net
Expenditure
|
(6,286)
|
3,816
|
684
|
(1,786)
|
(376)
|
(1,410)
|
Budgets carried
forward to 2021/22
9.
As
shown in table 4, of the £6.4 million favourable variance to
budget, £3.8 million represents slippage in one-off budgets
that have been agreed as budget carry forwards to 2021/22. A
further £0.7 million of unbudgeted grant income received in
year has been transferred to reserves for future
expenditure.
10.
The
most significant carry forwards were in Development and
Regeneration, representing £1.4 million for Didcot Garden Town
and Gateway projects, and £1.4 million for Berinsfield
regeneration. Details of all the carried forward budgets are
included in Appendix 2. The unbudgeted
grant income received in the financial year was £0.7 million.
This income will either be transferred to reserves and set against
expenditure in 2021-22 or in the case of the neighbourhood planning
grant offsets expenditure in previous years. The breakdown of
this funding is shown in table 5 below.
Table 5: Grant
funding transferred to reserves
|
Grant
|
£
|
|
Neighbourhood
Planning
|
80,000
|
|
Berinsfield
regeneration
|
150,000
|
|
Flexible homeless
support grant
|
203,648
|
|
Homes
England DGT funding
|
125,000
|
|
Preventing
homelessness
|
78,976
|
|
Local
Authority compliance & enforcement
|
46,849
|
|
TOTAL
|
684,473
|
Employee
costs
11. Employment costs
shows an overall underspend of £376,000 for the year with the
largest variances being in Corporate Services and
Planning.
12. The underspend in
Corporate Services was primarily the result of a £400,000
reduction in the fixed cost element of the council’s
contribution to the pension fund following the latest triennial
valuation. The results of the valuation were received after
the budget was set. In addition, there were staff underspends
arising in Cornerstone due to staff employed there being redeployed
elsewhere in the council to support the response to the
pandemic. The corporate training budget was also underspent
by £56,000 at year end.
13. Planning salary
costs were underspent by £486,000 due to difficulties
experienced in recruiting staff. This was offset by agency
staff costs of £235,000 to cover some of the vacancies, giving
an overall favourable variance of £251,000. This variance was
due to vacancies that could not be recruited to or covered by
agency staff which, notwithstanding increased workloads, resulted
in lower performance on minor and other applications and delayed
responses on consultations.
Other variances
over £50,000
14. Excluding the
carry forwards to 2021/22, grant income transferred to reserves and
employee cost variances, net revenue expenditure was £1.5
million underspent against working budget. The significant
variations from budget are explained below.
Development &
Regeneration
15. The costs of
running the council’s leisure centres was £185,000 below
the revised budget at year end. The budget was heavily
revised due to the closure of the leisure centres caused by the
pandemic and the revision was made before it was known that the
council would receive National Leisure Recovery Funding from the
government of £260,000.
16. Income from the
council’s commercial sites was also revised downwards during
the year based on estimates of what would be achieved but at year
end there was still an overspend of over £60,000, reflecting
the difficult operating conditions experienced in year. There
was also an overspend of over £50,000 on the costs of running
the council buildings during the year primarily due to additional
staffing costs being incurred and a loss of rental
income.
Finance
17.
The
revenues and benefits client budget was overspent by £78,000
at year end. This primarily reflected the loss of court fee
income during 2020/21 due to the suspension of debt recovery action
during the pandemic. This recovery action has now
restarted.
Housing &
Environment Services
18. Overall, waste
and street cleansing services were underspent by over
£400,000. Costs associated with recycling were
£201,000 below budget due to a lower indexation increase than
expected to the contract payments and an increase in recycling
tonnage. On refuse collection there was an underspend of
£112,000 again caused in part by the lower indexation
increase, plus also lower delivery costs than expected. On
garden waste, the number of customers increased in year leading to
a net underspend of £63,000. Street cleansing was also
underspent by £60,000 primarily due to the indexation
increase, and again costs were lower than budgeted.
19. Income from
licensing was revised downwards in year in expectation of lower
volumes due to the pandemic. At year end licensing was
underspent against the revised budget by £117,000 reflecting
that the in-year revision in income had been too pessimistic,
albeit that the outturn figure was lower than originally budgeted
for the year.
Partnerships
20.
There
was an underspend of £55,000 on the Five Councils contract
reflecting changes to profiling of contract charges following the
insourcing of the exchequer and payroll functions at the start of
the financial year.
Planning
Services
21.
The
Planning income budget for Building Control services and
Development Management was initially set at £2.5 million and
subsequently reduced to £2.1 million. Although a downturn in
activity was expected due to the pandemic the income for the year
was £2.9 million, resulting in a favourable variance against
the revised budget of £0.8 million. This variance however was
attributable to major projects, including three solar farms which
are not labour intensive to process and therefore were not impacted
by the staff shortages mentioned under employee costs above.
The income includes reimbursement received from Oxfordshire County
Council of £100,000 in respect of officers working on the
Oxfordshire 2050 plan.
22.
Progress on the
new local plan stalled due to the pandemic, confirmation of
corporate objectives and progress of 2035 local plan
examination. The costs relating to the local plan was also
less than expected due to the examination being held virtually. As
a result, and excluding employee cost savings identified above, the
Policy Team was underspent against budget by
£110,000.
Contingency
23.
When
the revised budget was set, provision was made for losses in income
from sales, fees and charges to be met under the government’s
sales fees and charges compensation scheme. However, as
identified above, a number of the council’s key income
streams, including building control and planning, performed better
than expected in year. This led to claims from government
under the compensation scheme being over £450,000 lower than
estimated when the revised budget was set.
Comparison to
previous year revenue outturn
24.
A
comparison of the 2019/20 revenue outturn to 2020/21 is shown in
table 6 below.
Table 6: 2019/20
and 2020/21 revenue outturn
|
|
2019/20
Total
£000
|
2020/21
Total
£000
|
|
Income
|
1,902
|
(4,280)
|
|
Expenditure
|
(5,832)
|
(2,114)
|
|
Net
position before Carried Forward Budgets
|
(3,930)
|
(6,394)
|
|
Carried
Forward Budgets
|
3,271
|
3,816
|
|
Net
position after Carried Forward Budgets
|
(659)
|
(2,578)
|
Capital outturn
2020/21
25.
The
original capital budget for 2020/21, including growth, was agreed
in February 2020 at over £26 million. Details of the changes
to the capital programme in year are summarised in table 7
below:
Table 7:
movement on capital programme
|
|
2020/21
£000
|
|
Original
capital budget
|
26,323
|
|
Roll
forward from prior years
|
4,075
|
|
Schemes
deleted
|
(20)
|
|
Additions
in year (externally funded)
|
859
|
|
Additions
in year (other)
|
228
|
|
Slippage
to future years
|
(8,254)
|
|
Capital
programme 31 March 2021
|
23,211
|
|
Made
up of:
|
|
|
Approved
programme
|
13,290
|
|
Provisional
programme
|
9,921
|
|
Capital
programme 31 March 2021
|
23,211
|
26.
Capital
expenditure for 2020/21 was £1.6 million, a variance of
£11.7 million against the approved programme for the year of
£13.3 million. Details of the variance of spend against
the approved capital programme working budget is shown in appendix
3 to this report.
27.
During the year,
budget holders review their projects and identify those where
delays mean that the current working budget will not be spent in
year. The budget profile is then moved to reflect the new
spend profile and budgets are slipped into future years if
applicable. Slipped budgets remain committed for use in future
years. During the year £8.3 million was slipped in this
way. A list of these schemes is shown in appendix
4.
Capital
receipts
28.
Capital receipts
in year amounted to £62,000. Repayments of Catalyst
loans make up £31,000 of this total.
Financial, legal
and any other implications
29.
The
financial implications are as set out in the body of the report.
There are no other implications of this report.
Conclusion
30.
The
2020/21 financial year was particularly challenging as the council
faced the impact of the Coronavirus pandemic, but at year end the
outturn position on revenue and capital was an underspend against
the working budget for the year. Details of major variances
are detailed within this report and the appendices.
Appendices
1.
Revenue outturn
– expenditure and income variance
2.
Revenue carry -
forward 2020/21 requests
3.
Capital outturn
– summary and commentary
4.
Capital outturn
– slippage
Background
Papers
·
Budget Papers for
2020/21
