£53M Potential deficit turned into £5M surplus

£5.1million is available for council reserves in 2021/22 thanks to both early reprioritisation by the council and grants of over £43million from central government, to mitigate against both lost income and increased costs as a result of the pandemic.

Cllr Drew Mellor, Leader of BCP Council, said, “We were predicting an overspend of tens of millions of pounds last summer. This is a huge turnaround, largely thanks to the government delivering on its commitment to support local authorities to recover the costs of a swift and comprehensive response to the pandemic. Government recognised a local response was essential to protect communities and support businesses and has made funding available to recompense us for that effort and expenditure, as promised.”

Last summer, faced with huge loss of income from the forced closure of the council’s car parks, leisure attractions and food concessions the council was facing a predicted £53million shortfall. Through a stringent and proactive financial management strategy and working closely with central government, the overspend was turned round into a £5million surplus.

The full extent of the huge changes and variations to the 2020/21 budget, compared to that set in February 2020, can be seen in the report detailing the year-end outturn, for consideration by Overview and Scrutiny Board on 14 June, and Cabinet on 23 June.

At the same meeting, members will receive the proposed financial strategy supporting the development of the 2022/23 budget including options developed by comparing the council with similar sized authorities. This includes the opportunity to create £212million of headroom for the council to invest in key priorities over and above those already supported through the medium-term financial plan, alongside plans to balance this by increasing the councils unearmarked reserves.

Cllr Mellor continued: “We are already managing our funding streams well but are borrowing significantly less than similar councils. We’re using prudential borrowing to provide a £50 million Futures Fund for creating a world class city region, stepping up regeneration, place-based leadership and restoring a sense of pride; and a £10million Special Educational Needs and Disability (SEND) allocation, to support the Dedicated Schools Grant (High Needs Block). Our Big Plan reflects the scale of ambition for the area and articulates our vision with key regional and sub-regional partners and with government.

“To back our ambitious plans to create a world class city region and the best place in the UK to live, work and play, the government will support us to invest over £200m in the area. It should be emphasised that any such investment will only be approved if supported by robust businesses cases and will position the council’s debt at the mid-point compared to all upper tier authorities.”

Cllr Mike Greene, Portfolio Holder for Transport and Sustainability added:

“When we took on the Council's leadership, we immediately reversed the £240k cut made by the previous administration to this year's Climate Action budget. It is now clear that if we are to be true to our word in signing up to the climate emergency then that amount doesn't go anywhere near far enough. So, we are doubling the amount this year, with a further £240k going into the Climate Action budget; and this £480k for 2021/22 is just the beginning. Over the next few months, I hope to be bringing forward proposals for significant further investment in this vital area. We are proving that the climate debate isn't a binary choice between helping the environment and the helping economy: we will do both.”

The papers for the meeting can be found on the council’s website.

 

Posted on Thursday 10 June 2021