28th September 2020

Somerset strengthens its financial position

Extra one-off funding, technical adjustments and savings have helped substantially strengthen Somerset County Council’s financial position, the authority’s end of year financial report has set out.

The Council’s Revenue Budget Outturn Report for 2018/19, which will be considered by Cabinet on Monday (10 June), shows that it has been able to increase its general reserves by £4.2m to just over £16m – a prudent level for a budget its size.

The report describes the Council’s financial outlook as being “more positive than it has been for a number of years” with a 1.85 per cent underspend (£5.9m) on its net budget of £318m. But it also acknowledges the “significant level of uncertainty” due to a reliance on one-off grants, increasing demand and the unknown outcomes from the ongoing Government reviews of funding for local government.

Of the £328m net budget for next financial year, around £58m can be described as ‘uncertain’ or ‘one-off” including over £30m of funding for adult social care.

Leader of the Council, Councillor David Fothergill, said: “It has taken a lot of hard work and difficult decisions to achieve this turnaround and I commend all the staff who have played a part in this.

“We’re on a stable footing but recognise the big challenges ahead and the need to address our low levels of reserves as well as investing in prevention.

“The fundamental problems with local government funding remain as big as ever. We need a funding system that takes account of the costs that come with an ageing population and the challenges of providing services in rural area.

“Far too much of our funding – particularly in social care – is uncertain, we don’t know for sure whether it will be there next April. Local government cannot plan ahead with that kind of uncertainty, nor can our providers, and for real sustainability a long-term funding solution social care is desperately needed.”

Early in the financial year an overspend of around £12m was being projected. Since then £3.7m has come from additional one-off grants and funding, £4.2m through technical financial adjustments and £9.4m of savings approved in September.

To read a full copy  of the report visit http://democracy.somerset.gov.uk/ieListDocuments.aspx?CId=134&MId=734&Ver=4