Published on:
28
June 2012
Clackmannanshire Council today approved four reports which showed a positive financial position.
The draft statement accounts for 2011/12 show that the Council has reduced its external debt by £1.2million. And the Council begins the 2012/13 financial year with uncommitted reserves of £5.545 million, compared with £3.624 million last year. In keeping with best practice, the Council aims to keep its uncommitted reserves at a minimum of 3% of its budget, and these currently stand at 4.6%.
Council Leader Gary Womersley said: "The results for the year are extremely positive considering the current economic climate and provide us with a platform from which to address the challenging times ahead. Against the backdrop of reducing resources, the Council has successfully delivered savings in the year in excess of its budgeted requirements as a result of its ongoing budget realignment, service redesign and pro-active financial management activities."
Last year the Council reviewed the way it finances the three PPP secondary schools and decided a straight repayment model supported by funding from the sale of assets set aside is more appropriate. Previously, the Council planned to pay for these by raising council tax. With a council tax freeze and changes in the level of interest rates this was no longer practical, and further work will be undertaken during 2012/13 to review the options available for the longer term financing of the Council's PPP. The Council will pay over £7 million in PPP repayments in 2012/13 towards the total outstanding of £248.338 million.
Councillor Womersley added: "This year's statements show an increase in the Council's uncommitted reserves to support service delivery in future years, another year in which it has not been necessary to increase the level of the Council's external debt and the realisation of a significant capital receipt from the sale of a former school site which supports the Council's strategy of reducing debt."
As part of the statement of accounts, an Annual Governance Statement will be signed by the Council Leader and Chief Executive for the first time. This provides a high level of assurance around a range of internal issues including risk, sound strategic, financial and workforce planning and good resource and information management.
Councillor Womersley said: "One of this administration's key priorities was to enhance governance arrangements, so I delighted that I will be the first Council Leader to sign this important document, which represents a huge step forward in this vital area."
Later at the same meeting, Councillors were given an update on the budget strategy.
When the Council approved the 2012/13 budget earlier this year, a funding gap of £13.277 million was predicted for the years to 2014/15.
The forecasting of this funding gap is regularly reviewed taking the changing economic outlook into account with issues such as the planned welfare reform being taken into account.
The budget strategy now involves a year-round approach to the identification, development, monitoring and implementation of proposals to reduce the Council's expenditure and/or increase income.
Council Leader Gary Womersley said: "This enhanced process for reducing expenditure, with a year-round approach and constant cycle of budget reviews, has brought all elected members closer to the process and engaged us in the early discussion of proposals."