Powys County Council budget only balanced with £4m reserves
A council is having to dip into its reserves to the tune of more than £4 million to balance its finances.
Last week it was revealed that more than £7 million in cuts was yet to be achieved in Powys County Council services as the authority tries to wrestle with its budget.
The cabinet met on Tuesday in Llandrindod Wells for the first time since the summer break.
They discussed a report and an action plan, which has been designed to try and turn the situation around.
The council still needs to find £7.7 million, despite already making savings of £4.5 million in the current year.
Services are still £4.9 million over budget – and now the council is having to use £4.2 million from its reserves due to the budget overruns.
Councillor Aled Davies, finance portfolio holder, said the situation was similar to last year. But he added the major difference was the council still had a surplus at the end of the 2017-18 financial year.
He said: “This position is not dissimilar to that reported at the same point last financial year.
“However, the out turn position improved significantly by year end, and was finally reported as an underspend.
“A number of factors contributed to the improved position including the receipt of additional unexpected funding from Welsh Government, improved income collection, previously unreported underspending in some budgets and capitalisation of transformation costs, all of which eased the pressure on the revenue budget.”
The cabinet passed the report and said a review of all budget lines would be undertaken, as well as looking at where underspends were already being reported and unlikely to change, or where income was higher than expected and projected to continue.
Delegated authority can be applied, in consultation with the portfolio holder for finance, to freeze or realign those budgets for the remainder of the financial year.
Councillors also agreed to monitor the council’s financial performance and ensure spending remained within approved limits.
It was also agreed a three per cent minimum general fund reserve should be maintained.
