by DOUGLAS SHEPHERD
Scottish Borders Council's financial plans for this year include borrowing £35 million which will help to fund £87.4 million of expenditure, including investment in new schools and care homes. And over the next decade the local authority will invest £580 million, £258 million of that to be bankrolled by borrowing, according to figures contained in unaudited accounts for 2020/21.The 122-page document is available on the council's website among the papers for next week's meeting of the Audit & Scrutiny Committee. Once the accounts have been approved by councillors they will be the subject of public consultation when objection can be taken to the contents.
Despite the tight monetary regime it operates under SBC still managed an underspend of more than £2 million during the last financial year, and received significant extra financial assistance from the Scottish Government to help it fight Covid-19.
In a foreword to the accounts SBC's leader Councillor Shona Haslam says that during 2020/21 the authority continued to deliver vital Council services during the COVID-19 pandemic in very challenging circumstances. Over £12m savings were delivered to transform frontline services with a range of improvements.
According to Mrs Haslam: "The COVID-19 pandemic has caused a major impact on delivery of public services during 2020/21, with ongoing impacts on a number of Council Services. Despite this extremely challenging operating environment the Council achieved the following during 2020/21: Delivered a responsive approach to supporting communities, businesses and vulnerable individuals through the COVID-19 pandemic.
"The Council administered over £52m of grants to local businesses, established five community assistance hubs and accelerated roll out of Inspire Learning to support home learning during lockdown. Extension of the CGI contract to 2040; Achieved £12.1m of Financial Plan savings, £7.9m of which were on a permanent basis; Delivered a net underspend of £2.516m from a revenue budget of £278.4m; Delivered new investment in assets for the Borders of £54.8m in schools, flood protection, roads, lighting and other assets."
She adds that the next year presents many opportunities and challenges for the Council including: the ongoing response and recovery from COVID-19; the continued delivery of the Council’s transformation programme; delivery of IT transformation; South of Scotland Enterprise and the wider Regional Economic Partnership including Borderlands; National review of Social Care.
A management commentary by David Robertson, executive director Finance & Regulatory, states: "Covid-19 - The Council has received significant support from Scottish Government to maintain public services during the pandemic. The Council administered over £70m (£52m in 2020/21) of business grants to support 5,770 local business through the COVID-19 pandemic.
"IT transformation - The Council extended its strategic partnership with CGI in September 2020 with the aim of delivering significant IT and financial benefits to the Borders over the next 20 years. In doing so the Council aims to become a Smart Rural Region.
"Fit For 2024 - The current COVID-19 pandemic will have a fundamental impact on the way the Council is organised and delivers services going forward with the Fit for 2024 programme instrumental in ensuring the Council builds on all transformational benefits the pandemic presents including digital advancements."
In a section headed Financial Plans Mr Robertson points out that since 2013/14, and to date, permanent savings of £63m have been delivered in a planned manner. Despite the resource challenges facing the Council and wider public services, the approach to financial planning has so far delivered balanced budgets and small underspends in each year.
The accounts show the Council’s outstanding external debt as at 31 March 2021 was £221m, with no additional long term borrowing undertaken during the year. Short term borrowing for cash flow purposes was undertaken during the 2020/21 year with £15m outstanding at the year end. The average rate of interest paid on outstanding external debt was 4.33%.
And as at 31 March 2021 the total usable reserves balance is £47.7m (£29.9m at 31 March 2020) a net increase of £17.8m during the year.
"Future financial plans 2021/22 - £87.4m investment, including investment in new schools and care homes, funded by £35m borrowing in 2021/22. £580.1m investment over next 10 years, of which £258m funded by borrowing."
The commentary concludes: "The challenges posed by COVID-19, reducing Scottish Government funding and cost pressures from pay and price inflation all continue to affect the Council’s finances. The Council’s transformation programme remains the key focus of activity in balancing pressures with available resources. The Council, despite ongoing challenges, has met the aims of its Financial Strategy and again delivered its planned services within budget with significant investment in new and improved facilities. Scottish Borders Council remains financially sound and well placed to serve the people of the Scottish Borders in the future."
Notes to the accounts reveal that the three secondary schools in Earlston, Eyemouth and Duns, delivered via the controversial PPP system in 2006 will cost SBC and its taxpayers £13.944 million in 2021/22 made up of £5.722 million for services, £5.021 million in reimbursement of capital expenditure and £3.202 million in interest charges. Total payments linked to the schools' provision is stated as £318.571 million.
The interest paid on loans from the Public Works Loans Board and from other sources came to £11.693 million (£12.350 million in 2019/20).
A management commentary by David Robertson, executive director Finance & Regulatory, states: "Covid-19 - The Council has received significant support from Scottish Government to maintain public services during the pandemic. The Council administered over £70m (£52m in 2020/21) of business grants to support 5,770 local business through the COVID-19 pandemic.
"IT transformation - The Council extended its strategic partnership with CGI in September 2020 with the aim of delivering significant IT and financial benefits to the Borders over the next 20 years. In doing so the Council aims to become a Smart Rural Region.
"Fit For 2024 - The current COVID-19 pandemic will have a fundamental impact on the way the Council is organised and delivers services going forward with the Fit for 2024 programme instrumental in ensuring the Council builds on all transformational benefits the pandemic presents including digital advancements."
In a section headed Financial Plans Mr Robertson points out that since 2013/14, and to date, permanent savings of £63m have been delivered in a planned manner. Despite the resource challenges facing the Council and wider public services, the approach to financial planning has so far delivered balanced budgets and small underspends in each year.
The accounts show the Council’s outstanding external debt as at 31 March 2021 was £221m, with no additional long term borrowing undertaken during the year. Short term borrowing for cash flow purposes was undertaken during the 2020/21 year with £15m outstanding at the year end. The average rate of interest paid on outstanding external debt was 4.33%.
And as at 31 March 2021 the total usable reserves balance is £47.7m (£29.9m at 31 March 2020) a net increase of £17.8m during the year.
"Future financial plans 2021/22 - £87.4m investment, including investment in new schools and care homes, funded by £35m borrowing in 2021/22. £580.1m investment over next 10 years, of which £258m funded by borrowing."
The commentary concludes: "The challenges posed by COVID-19, reducing Scottish Government funding and cost pressures from pay and price inflation all continue to affect the Council’s finances. The Council’s transformation programme remains the key focus of activity in balancing pressures with available resources. The Council, despite ongoing challenges, has met the aims of its Financial Strategy and again delivered its planned services within budget with significant investment in new and improved facilities. Scottish Borders Council remains financially sound and well placed to serve the people of the Scottish Borders in the future."
Notes to the accounts reveal that the three secondary schools in Earlston, Eyemouth and Duns, delivered via the controversial PPP system in 2006 will cost SBC and its taxpayers £13.944 million in 2021/22 made up of £5.722 million for services, £5.021 million in reimbursement of capital expenditure and £3.202 million in interest charges. Total payments linked to the schools' provision is stated as £318.571 million.
The interest paid on loans from the Public Works Loans Board and from other sources came to £11.693 million (£12.350 million in 2019/20).
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