Agenda item

Consideration was given to the report of the Chief Officer Resources which presented the outcome of the assessment undertaken by Audit Wales relating to the Financial Sustainability of Blaenau Gwent County Borough Council.

The Audit Wales Officer spoke to the report and highlighted the main points contained therein.  She informed Members that the report sets out the findings of their financial sustainability review at Blaenau Gwent County Borough Council.  It was a piece of work undertaken with all Councils across Wales to look at financial sustainability and local government, particularly in the context of the COVID pandemic.

A Member commented that these had been good financial years for the Authority due to good settlements from the Welsh Government, hardship funding had helped put the Council in a good position, but felt this could be a false position as the Bridging the Gap Programme was untested as Members had not seen a full year results due to the pandemic.  He felt that the liquidity issue needed to be borne in mind and the Authority needed to be careful in relation to too much borrowing.  He said it was a good report but had been heavily impacted by Welsh Government funding and commended the good work of the financial team.

Another Member agreed that it was a good report but had concerns regarding the use of the hardship funding and felt that some of this funding should have been used to help communities with CCTV and public safety issues.  He felt that less money should have been put into reserves and more put into CCTV services to keep communities safe throughout the winter months.

The Chair informed the Committee that a report on CCTV would be presented to a future meeting of the Corporate Overview Scrutiny Committee for consideration.

The Service Manager Accountancy said that the hardship fund was a grant with terms and conditions, CCTV and Community Safety was not part of those terms and conditions.  All the money spent from the hardship fund complied with those terms and conditions and was all about responding to the pandemic.  She advised that there was some funding from the hardship fund that went to the community via statutory sick pay enhancements and social care payments.

A Member thanked the Audit Office for the positive report even though the impacts of COVID highlighted in the report were not fully known.  He felt that at this point in time the proactive actions of the Council had put it in a very strong position to meet future financial challenges and saw this as a very positive endorsement from the Audit Office.

In response to a Member’s question regarding the working capital ratio, the Audit Wales Officer said there wasn’t an ideal number that the Authority should be aiming to achieve, it depended on the specific circumstances at each Council and the approach that they may want to take.  She felt it was about Members gaining assurance that although this figure was low, was the Council in a position where it could meet its liabilities as and when they needed to be dealt with.  It was mentioned in the report that the Council were prompt in paying its debts to ensure that it was supporting the local economy, in that way, that did impact on the liquidity figures. As such some local policies like that would impact and bring the Authority’s score down.

A Member referred to page 30 paragraph 9 of the report - In total, the Council anticipates it will receive approximately £12.2 million of additional funding from the Welsh Government in 2020-21. This is set out in Exhibit 2 below. The total excludes funding where the Council acts as an agent, distributing funds from the Welsh Government to third parties.  He enquired regarding clarification on third parties.  The Audit Wales Officer clarified that this related to money from the Welsh Government given to the Authority to distribute to third parties such as local businesses, this money was not included in the figure as the Council was unable to keep it and had to distribute it on behalf of the Welsh Government. 

The Chair endorsed the Members comments and said it was a good report and clearly demonstrated the Authority’s long term financial commitment and showed that the Authority was moving in the right direction.  He thanked the Audit Wales Officer for presenting the report and the financial team.

The Committee AGREED to recommend that the report be accepted and endorse Option 1; namely that the findings of the Audit Wales report, as detailed in the report and appendix be accepted.