To approve proposed changes to earmarked reserves following the annual review.

Earmarked reserves are established to hold revenue balances to fund future year commitments over and above the annual budget requirement. They generally arise where funding exceedsexpenditure, usually due to the timing of receipts being ahead of incurring expenditure. As amatter of good practice a review is undertaken each year to establish the continued need forreserves held for earmarked purposes to ensure resources can be used to best effect whilstmaintaining a prudent level of reserves to meet future anticipated commitments.

The annual review has highlighted the proposed movement of £7.5m of reserve funding from two reserves held into alternative reserves, summarised below-

 Reduction of the sparsity reserve (£6.4m)

 Part utilisation of the minimum revenue provision reserve (£1.1m)

 Severe weather fund, proposed reserve addition of £1.4m

 Children’s wellbeing structural change, new reserve of £1.6m

 Adults and wellbeing provision of care cost, new reserve of £0.5m

 Road remedial works, £2.8m

 Living Wage, new reserve of £0.5m

 Health and wellbeing new reserve of £0.5m

 Legal services demand, new reserve £0.2m

That:

(a) the following movements re earmarked reserves be approved:

 the sparsity reserve be reduced by £6.4m

 the minimum revenue provision reserve be reduced by £1.1m

 the severe weather reserve be increased by £1.4m

 a new reserve of £1.6m established to support structural change in children’s wellbeing

 a new reserve of £0.5m established to support providing care costs in Adults and Wellbeing

 a new reserve of £2.8m established to support remedial road works

 a new reserve of £0.5m established to meet any future liabilities re living wage claims

 a new reserve of £0.5m established to support the community health and

wellbeing requirements

 legal services demand, £0.2m

1.     To not approve the proposed earmarked reserve movements. This would mean reserves remain earmarked for the purposes currently stated and may not be used to support priority activity. The proposals follow an annual review and therefore the alternative option is not recommended.

2.     To propose alternative movement of reserves. This is open for Cabinet to determine. However should that mean that funds that are required for an earmarked purpose are no longer available an alternative method of funding would need to be secured.