Agenda item

Financial Monitoring Quarter 1 Report

To consider the report of the Cabinet Member for Performance and Resources seeking Members to note year-end forecasts and financial pressures on the Council during the 1st Quarter ending 30th June 2021.

Minutes:

26.1    The Cabinet Member for Performance and Resources introduced the report and confirmed that the purpose was to provide an update on the Council’s current financial position against the agreed budget for the 2021/22 financial year. She confirmed that the forecast for the year-end position for the current financial year was an increase to the General Fund balance of £173k against a budgeted increase of £123k, resulting in a surplus of £50k.

 

26.2    The Cabinet Member for Performance and Resources confirmed that there were significant variances in budget between Cabinet portfolios. She noted that the forecast variance for the Performance and Resources portfolio was currently £1,560m. Referring to the £30m of Housing Subsidy payments, she confirmed an expected budgetary pressure of £183k but confirmed that this would be balanced out by other portfolios. The Cabinet Member for Performance and Resources expressed the view that she was cautiously optimistic about the Quarter 1 figures.

 

26.3    Councillor Pullen referred to the reduced income from parking outlined at 5.4 of the report. He noted that more people may be using public transport for environmental reasons and commented that there was less footfall in the city generally as many people were still working home. Councillor Pullen asked for the Cabinet Member’s views as to whether this was a concern, and whether consideration had been given to adjusting to a more realistic target.

 

26.4    The Cabinet Member for Performance and Resources noted that any long-term change in consumer demand for car parking spaces was outside of the Council’s control, however she suggested that if people were changing their vehicles to electric cars for environmental reasons, a solution might be to alter the facilities at existing car parks to include more charging points. Referring to recent events which had taken place in the city, the Cabinet Member for Performance and Resources noted that there were encouraging trends relating to footfall in the city centre. The Head of Policy and Resources reiterated that the report outlined figures relating to Quarter 1, and highlighted there were still some Covid-19 restrictions in place during the Quarter 1 period which would have had an impact on footfall in the city. The Head of Policy and Resources noted that if there was a long-term reduction in income from parking, then the Council would have to look for savings elsewhere.

 

26.5    In response to a further question from Councillor Pullen on the reopening of the Arbor venue at the Crematorium, The Cabinet Member for Performance and Resources confirmed that the Arbor had reopened and noted that she had recently visited the venue. She confirmed that a risk assessment had been undertaken and that the venue had robust Covid-19 safety precautions, including hand sanitizer stations. The Cabinet Member for Performance and Resources indicated that she was confident that there would be an improvement in income generated from the Arbor in the coming months.

 

26.6    The Chair raised concerns about the cycling infrastructure and facilities for cyclists in Gloucester and asked what the administration was doing to make the city more accessible for cyclists.

 

26.7    The Cabinet Member for Performance and Resources noted that the County Council was the responsible authority for highways matters and suggested that this was an issue which twin Members for the City and County Councils may wish to pursue with the County Council.

 

26.8    Councillor Wilson asked whether the year-end forecasts were based on assumptions of a slow recovery. The Head of Policy and Resources explained that St Oswalds and the Eastgate Shopping Centre were delivering income for the Council. He noted his hope that with the arrival of the new Primark store which was due to take up tenancy at the old BHS unit, there would be increased footfall in the Kings Walk Shopping Centre area. In response to a further question from Councillor Wilson about contingency plans in the event of a further lockdown, the Head of Policy and Resources explained that even during previous lockdowns, there was no great change in income generated from St Oswalds which therefore remained key to economic recovery in the city.

 

26.9    In response to a question from Councillor Hilton about the Council’s plans to facilitate electric cars, the Head of Policy and Resources confirmed that consideration was being given to the use of electric cars for the Council’s own fleet and options for installing charging points at existing car parks were being considered. The Cabinet Member for Performance and Resources further noted that the Council would need to react as consumer demand changed and would be something for this and future administrations to monitor. Referring to the Forum development, she confirmed that the attached car park would have electric car charging points and would act as a case study as to whether further electric car parking facilities were needed in the future.

 

26.10  Councillor Hilton raised concerns about the £571k in lost income from the Council’s commercial property (5.2). The Head of Policy and Resources explained that with the arrival of the new Primark store in the old BHS unit, there had already been new leases issued for the units next door and there was a hope that the shopping centre would become more attractive to other businesses. He confirmed that arranging lease extensions in the current climate were challenging but with the completion of Kings Walk and new Forum development, this particular area of the city would become more attractive.

 

26.11  In response to a question from Councillor Tracey about the rent-free period agreed with the new Primark store, the Cabinet Member for Performance and Resources explained that negotiations about rent-free periods, refurbishment and dilapidation costs were a standard process when landmark retailers like Primark look to occupy a large unit. She expressed the view that it was important to secure landmark tenants like Primark for the growth of the city and was confident that this would feed through and encourage other retailers into the city.

 

26.12  Councillor Pullen asked for clarification as to the timeframe for the agreed rent-free period for the new Primark store. The Head of Policy and Resources confirmed that this information would be provided to Members in due course, subject to commercial confidentiality requirements.

 

26.13  Councillor Kubaszczyk expressed the view that a good quality Primark store was important for the city as it was likely to draw customers into the town centre.

 

26.14  In response to concerns raised by Councillor Tracey about the misuse of electric scooters in the city, the Cabinet Member for Performance and Resources clarified that this was a matter that Members may wish to raise with the County Council, who have responsibility for highways issues.

 

 

            RESOLVED – That the Overview and Scrutiny Committee NOTE the report.

 

 

 

 

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