Posted: Thu 20th Jul 2023

Swansea council’s day-to-day spending £17 million less than expected in 2022-23, surplus to be carried over, says finance director. /
This article is old - Published: Thursday, Jul 20th, 2023

SWANSEA Council’s day-to-day expenditure was £17 million less than expected in 2022-23, mainly because of delays in planned spending and the fact that the budget was shored up by money normally held in reserve.
Most of the £17 million surplus will therefore carry over and be spent this financial year, members of the council’s cabinet were told.
Ben Smith, the council’s director of finance, said: “We can say, ‘We live to fight another day.’ I would rather have that flexibility than not.”
All of the council’s key departments underspent by varying amounts. The environment and transport department – known as place – underspent by £9.2 million, but only because it had been allocated £9.6 million of reserves aimed at post-Covid recovery. It also restricted staff recruitment.
The social services department underspent by £1.1 million, partly because staffing vacancies haven’t been filled.
The education department underspent by £800,000 despite a significant rise in school transport costs, while the corporate services department ended up with a £5 million surplus. Most of that £5 million will carry over to be spent this financial year.
Schools, which received a £179 million delegated budget in 2022-23, overspent by just over £8 million. This shortfall has been covered by a schools’ reserves fund, which now stands at £20 million.
The council’s total budget for day-to-day spending last year was £524 million. The funding for it came from the Welsh Government (£297 million), council tax (£138 million) and a share of business rates (£89 million).
Another feature of 2022-23 was that £8.5 million less than expected was needed to finance borrowing costs for capital schemes like new schools and regeneration projects. This was partly because of project delays, known as slippage. The underspend will be carried over to meet future capital financing requirements.
The Labour-run council has borrowed large sums of money for city centre projects and investment in schools but has done so when interest rates were significantly lower than today.
Council leader Rob Stewart, who has faced criticism from the opposition about the scale of borrowing, told cabinet colleagues that this had been the right thing to do. A few days previously Liberal Democrat councillor Chris Holley, the leader of the opposition, questioned one of the projects – the conversion of the former BHS and Miss Selfridge stores on Oxford Street into a new central library and community hub – and suggested that the vacant Debenhams store, by the Quadrant bus station, might be a better venue.
Speaking at cabinet, Cllr Stewart said the reason the library was being moved back to the city centre from the Civic Centre was because the former Lib-Dem administration had moved it out in the first place.
Cllr Stewart said it was one of several “sensible” decisions by his administration, compared to “bonkers” ones by its predecessor.
He added that the allocation of money held in reserves to bolster day-to-day spending was to support schemes such as subsidised weekend bus travel, extra street cleaning teams and parking offers.
Cllr Robert Francis-Davies, cabinet member for investment, regeneration, events and tourism, said the council was criticised for borrowing £200 million and would probably be criticised for underspending.
“Whatever we do, we’re going to be criticised by the opposition,” he said.
Cllr Francis-Davies said the city needed investment, and that this was being delivered.
Addressing Cllr Stewart, he said: “Thank God we’ve got you as leader, who has had the vision for getting this city back working, buildings going up, and the confidence of the private sector following our lead.”
Cabinet went on to discuss and approve a confidential report about the central library and community hub project in closed session. Cllr Holley’s questioning of it stemmed from his reading of the report. He didn’t disclose any details about it but called for a rethink at a scrutiny committee meeting on July 18. “I think there is a very important issue we need to talk about,” he said. “It’s actually, are we doing the right thing?” ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

By BBC LDRS ‌​‌​‌​​​‍‌​‌​​‌‌‌‍‌​‌‌​​‌​‍‌​‌‌‌​‌‌‍‌​‌‌‌‌​​

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