Decision details

RESOLVED:

That Cabinet:

       i.         notes the latest budget forecasts of the General Fund (section 5), Capital (section 6), and HRA (section 7), and;

     ii.         supports the proposed approach (outlined in para 5.11) to utilise the additional investment income and one-off VAT refund to increase the Revenue Contribution to Capital Programme financing, in order to support a reduction in capital financing costs over the medium term.

KEY DECISION:

No

PORTFOLIO:

Finance and Corporate

ALTERNATIVE OPTIONS CONSIDERED/REJECTED:

As set out in report.

DECLARATIONS OF INTEREST:

None

DISCUSSION:

The Portfolio Holder for Finance and Corporate introduced the Financial Monitoring Report. He stated that there had been challenges, some variations but also some positives to report. The Strategic Director of Corporate Resources and S151 Officer explained that Senior Officers were being proactive in identifying, addressing and reporting variations as they occurred within the service budgets. Regarding the General Fund, the two variations of note were the interest earning position and the VAT reclaim. Work with colleagues in the treasury team at Hampshire County Council and with NFDC’s third party treasury advisors continued and, as the Council was a net investor for the majority of the year, the high base rate had been a positive in terms of investment earnings. Given the Council’s large capital programme, the additional earnings would be put to good effect and support the financing of the capital programme delaying the timing of external borrowing required to ultimately finance that programme. There was less spend on homelessness than had been forecast, however this was countered with the additional budget requirements in the private sector leasing scheme. There was also a carry forward of £560,000 of government grant into 2024/2025 to spend on ongoing support to Ukrainian families located within the District. There were relatively minor variations being reported with the HRA at this time. There was £1.5m of rephasing into 2024/2025 for the Hardley Depot project, which was now underway with foundations being laid and steels being erected this month.

A non-executive member outlined that whilst appreciating the prudent financial management, more money should be spent by the Council on revenue projects that benefitted the residents, however the Portfolio Holder explained that all money spent by the Council was undertaken to benefit the residents of the District. With inflation hitting most costs associated with Council expenditure it was prudent not to make financial commitments that could not be met.