Narrative report
Revenue Budget and Expenditure
The Authority’s main funding sources are Council Tax, Non-Domestic Rate income and various Government grants which are used to fund the Authority’s revenue budget. To ensure that the revenue budget is sustainable over the medium term, the Authority agreed to increase Council Tax by 1.97%, resulting in an annual increase in a Band D property of £1.53 making a Band D Council Tax £79.29 per annum. Local taxation (Council Tax and Non-Domestic Rate income), including the Authority’s share of the surplus on Collection Funds, increased the Authority’s funding for 2020/21 by £2,028k. Government Grants (Revenue Support Grant and Non-Domestic Rates Top-up Grant) were increased by September 2019 CPI providing an additional £239k of funding for 2020/21. From 2020/21 the Small Business Rate Relief Grant is presented as a funding source rather than an income budget so, although it is not a new grant, the change in presentation increases the net revenue budget by £1,240k. The Authority’s budget for 2020/21 was therefore increased to £74,258k, a £3,507k increase when compared to 2019/20.
As well as the pressures faced by the Authority on areas such as pay awards, inflationary prices growth and other commitments totalling £5,692k, an increase of £750k was required to the budgeted transfer to/from the General Reserve (from a £550k transfer from the reserve in 2019/20 to a £200k transfer to the reserve in 2020/21) to maintain the balance at approximately 5% of the net revenue budget, meaning savings of £2,935k were required to balance the 2020/21 revenue budget. Notably, £1,562k of the savings came from reducing the base revenue contribution set aside each year to fund large infrastructure expenditure. In addition savings of; £526k were identified by Budget Managers from within their devolved budget headings; £314k as a result of not allocating an inflationary uplift to areas of discretionary spend; £273k additional government grant income for small business rates relief and; £260k as a result of changes to pay budgets.
The revenue budget outturn for 2020/21 was an underspend of £2,837k. The summary of the revenue budget and the final outturn is shown in the table below: