The Leader and Cabinet Member for Finance introduced the report which set out the revenue and capital projected outturn position for Quarter 2 2020/21.  He said that at the end of the first quarter, due to the impact of the Covid-19 pandemic, the projected revenue overspend was £2.25million, and this had risen to £3.3million by the end of Quarter 2.  The Leader and Cabinet Member for Finance said that the reasons for the increase and variances were set out in Tables 1 and 2 at paragraph 3.1 on pages 32 and 33 of the report, and he highlighted the pressure due to homelessness, loss of income and leisure centre costs.

Referring to the £3.3milion overspend, the Leader and Cabinet Member for Finance said that the projected loss of Swale’s share of income from Business Rates and Council Tax also had to be included, which resulted in a £3.9million overspend.  This total was offset by Government funding as shown in Table 5 on Page 35 of the report, but the Leader and Cabinet Member for Finance warned that the financial impact of the Covid-19 pandemic in the final months of the year were not yet known.

The Leader and Cabinet Member for Finance set out the improvement and recovery projects that would benefit from the pooled Business Rate Funding monies at paragraph 3.15 on page 37 of the report.

Finally, the Leader and Cabinet Member for Finance drew attention to paragraph 3.16 on page 38 of the report which was a historical litigation dispute to be settled, and paragraph 3.18 which related to the Leisure Centre contract.

Referring to paragraph 3.6, the Cabinet Member for Health and Wellbeing said that the Government had launched its National Leisure Recovery fund of £100million on 7 December 2020 and SBC had registered an interest.  She said the fund did not cover historic loss of income from leisure activities, but for proposed expenditure in order for facilities to be used in normal circumstances from 1 December 2020 to 31 March 2021.  The Cabinet Member for Health and Wellbeing explained the process of applying for the funding and said that SBC would be applying for each of the leisure centres in Sittingbourne and Sheerness, and for Faversham Pools.

The Leader praised the Finance team and the Cabinet Finance sub-group.

Resolved:

(1)  That the total projected revenue overspend of £3,319,000 (£2,555,000 as at end of June 2020) be noted.

(2)  That the settlement on litigation as set out in paragraph 3.16 be agreed.

(3)  That the use of reserve funds as set out in paragraph 3.15 be agreed.

(4)  That the payments with regard to the loss of income claims for the leisure contract as set out in paragraph 3.18 be approved.

(5)  That the projected capital overspend of £2,279,256 and expenditure of £5,676,723 as detailed in paragraph 3.23 and Table 10 Appendix I be noted.

(6)  That the additional Government funding received by the Council in response to the Covid-19 pandemic be noted.

(7)  That the capital variances and their funding as detailed in paragraph 3.21 and Table 10 Appendix I refers be approved.