2020-12-14 General Committee Agenda

GENERAL COMMITTEE MEETING AGENDA                                             14 DECEMBER 2020


    6      BUDGET REVIEW 2 (BR2)

    Author              Manager Financial Services, Trent Grauf
                        Corporate Services Department

    Index               ECM / Subject / 7.26 – 2020-2021 Budget

    Attachments         1.   Proposed Operating Budget Submissions
                        2.   Proposed Capital Budget Submissions
                        3.   Revised Capital Program
                        4.   Revised Statement of Income and Expenditure
                        5.   Revised Budget Financial Statements

    EXECUTIVE SUMMARY
    The Local Government Act 2009 and Local Government Regulation 2012 require Council to
    undertake regular reviews of the adopted budget to ensure it remains reflective of planned
    activities to be funded through the financial year. This second budget review for the 2020/21
    financial year (BR2) incorporates any new or emergent actions arising from Council
    resolution, Executive Team or Capital Works Executive Committee action, reallocation of
    funds or realised revenue variance since the adoption of the current BR1 budget in August
    2020.
    In summary the budget review is proposing an increase of $744k to Council’s operating
    position, resulting in the operating deficit increasing from $2.2 million to $3.0 million. This
    increase is primarily due to the expending of committed fire grant funds already received in
    the 2019/20 financial year. The revised capital expenditure program has also increased,
    albeit slightly to $35.3 million.

    Item                                        Current Budget           Proposed       Revised Budget
                                                          (BR1)        Adjustments                (BR2)
                                                         ($’000)             ($’000)             ($’000)
    Operating Revenue                                    96,575                $383              96,958
    Operating Expenditure                                98,788             ($1,127)             99,915
    Operating Result                                     (2,213)             ($744)              (2,957)
    Capital Grants and Contributions Revenue            $11,340                $301             $11,642
    Capital Works Expenditure                           $35,282                $110             $35,392

    RECOMMENDATION
    That Council note the report by the Manager Financial Services to the General Committee
    Meeting dated 14 December 2020 and approve the proposed changes to the budget for the
    2020/21 financial year as outlined in the revised Budget Financial Statements attached to
    the report.


    REPORT
    Section 170(3) of the Local Government Regulation 2012 allows Council, by resolution, to
    amend the budget at any time before the end of the financial year. Consequently, formal
    budget reviews are scheduled to occur during August, November and April using the latest
    financial information available as the basis to revise the budget forecast.
    The key criteria for budget reviews include:
    1.     Council must ensure compliance with its financial sustainability policy targets. Note for
           the 2020/21 adopted budget, one indicator will not be met due to COVID-19 impacts.

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