The Executive Director of Resources submitted a report sets out the projected revenue and capital outturn positions for 2020/21 for both the General Fund and the Housing Revenue Accounts as at the end of September 2020 (Period 6). Attached to the report at Appendix 1 was the Financial Monitoring for Quarter 2 and at Appendix 2 the Performance report for Quarter 2.

The report explained that the forecast General Fund revenue outturn position as at the end of Quarter 2 was a £0.667m overspend. This forecast included gross revenue pressures of £20.050m arising as a direct result of Covid-19.  The Housing Revenue Account (HRA) was currently projecting an underspend of £1.880m as at the end of Quarter 2. The General Fund Capital Programme was forecast to underspend by £111.231m this year. This was predominantly because the £80m budget for commercial property would not be used. The HRA Capital Programme was currently forecast to underspend by £15.146m due to delays to the delivery of the Major Repairs Scheme and Phase 2 and Phase 3 of the New Build and Acquisitions Schemes.

The combined gross revenue and capital pressures as a result of Covid-19 totalled £20.350m. This was partially offset by a total allocation of £9.775m of Central Government general support grant and an estimated £0.837m furlough grant claim and an estimated £6m in income compensation. This gave a net projected pressure caused by Covid-19 of £3.738m. A fourth tranche of Government general support grant had been announced on 12 October 2020, of which Reading’s share was 3.494m. This had not been included within the Quarter 2 projections but would be reflected in future reports.

Resolved –

(1)      That it be noted that:

a)    The forecast General Fund revenue outturn position as at the end of September 2020 was a net overspend of £0.667m, due to an overspend of £19.247m on services budgets mitigated by an underspend of (£1.968m) on corporate budgets and Government Covid-19 Grants of (£16.612m) which comprised (£9.775m) of general support funding, an (£0.837m) furlough claim and an estimated (£6.000m) income compensation claim;

b)    The Housing Revenue Account was forecast to underspend by (£1.880m) as at the end of August 2020;

c)    The General Fund Capital Programme was forecast to underspend by (£111.231m) and the HRA Capital Programme is forecast to underspend by (£15.146m) due to delays to the delivery of the Major Works Scheme and Phase 2 and Phase 3 of the New Build and Acquisitions Schemes as at the end of September 2020;

(2)      That the removal of the “Purchase of Commercial Property” capital scheme from the General Fund Capital Programme for the current and following two years be approved.