Use of Reserves
Reserves are an essential part of good financial management. They allow the Authority to manage unpredictable financial pressures and plan for its future spending. The Authority has two different types of reserves: General Reserves and Earmarked Reserves. The Authority’s policy is to maintain General Reserves at approximately 6% of the net revenue budget or £4m, whichever is the greater. However, no limits are set for Earmarked Reserves as they are established for specific circumstances. The Authority reviews its requirement for reserves at its February meeting each year. However, the table below sets out the anticipated reserve levels over the medium term.
| Estimated Financial Reserves Levels (All figures are £000 unless stated) |
2015-16 | 2016-17 | 2017-18 | 2018-19 | 2019-20 |
|---|---|---|---|---|---|
| General Fund Balance – year end 31 March | 4,200 | 4,150 | 4,030 | 4,020 | 4,070 |
| Earmarked General Fund Reserves – year end 31 March | 24,580 | 20,921 | 16,117 | 14,341 | 8,841 |
| Expected Use of Earmarked Reserves - in year | -1,970 | -3,659 | -4,804 | -1,776 | -5,500 |
A large amount of the Earmarked Reserve is used to help fund the capital programme.