Scarborough Borough Council Funding Pots to be Reallocated

Money that was allocated for specific purposes by Scarborough Borough Council is to be be absorbed into general council funds and could be used for schemes elsewhere in the county.

North Yorkshire Council is undertaking a significant review and reallocation of financial reserves inherited from the eight legacy councils, including the seven district councils and the county council. The move comes over two years since vesting day, prompting a reflection on reserve balances amidst anticipated pressures on the council's budget and the need to address identified gaps and capital overspends.

Previously, money was set aside by the legacy councils for specific purposes and these reserves were initially maintained for operational reasons.

However, Director of Finance, Gary Fielding, says the reserves will now be pooled for use across the county.

"We have a number of reserves, which were inherited from all eight legacy councils, so the seven districts and the county council, where money was put aside for a very specific purpose. In the new council and for good operational reasons. We didn't want to disrupt that. And so those reserves were maintained.

We're now well over two years on. And some of those issues have now been dealt with. Others are still in train.

But the proposal here is that we stop earmarking those funds because it comes a point at which you say, is this what you would invest? North Yorkshire Council's money in., is this a key priority?"

Mr Fielding highlighted a risk that the council might carry out projects deemed lower priority in a particular part of the county simply because a funding pot existed with that name, when the funds might be better used for other purposes elsewhere in the county.

"There is a risk that we are going to carry out something which is a lower priority in a particular part of the county because it just happened to be a funding pot with that name on it, when in fact we would want to use that for another purpose, maybe in the same part of the county or another part of the county.

But if it had been so high priority, the suggestion is wouldn't it have been started by now? but if it is still high priority and there's a good reason for the delay, it can come back. And just needs to be positioned in terms of why is a strategic priority. But there are some schemes I've rather not get into detail, where in my view they are quite lowly schemes where I don't think there's a lot of rationale for why they are pressing.

But reserves have been in place, so this would stop that happening and we could have a much more strategic approach to that."

Under the new approach, uncommitted reserve balances will default to transfer into corporate funds. This means the money is no longer automatically reserved for its original legacy purpose but becomes part of the general reserve for North Yorkshire Council. Future allocation of this money will be dictated by the council's rules and priorities.

Councillor Gareth Dadd, Council Leader, commented that the world has changed significantly over the last three or four years, making it appropriate to take a fresh look at these reserves.

"The world has changed over the last three or four years, and therefore it's right that we take a fresh look at these.

And this is not about saying no to everything. It's about a business case coming forward. And making the cut against what is very important to this authority, but more importantly to the residents that we're trying to protect and serve.

Councillor Carl Les noted that the changing world has been influenced "most recently because of a new government with and that government has new priorities" adding "I don't think we're very high up in that list of priorities for the new government."

For services or projects to secure funding from these reserves, they will now need to submit a business case. These requests will be reported through the quarterly performance monitoring process. Importantly, there is no longer an entitlement to receive the money based on its original intended purpose by a legacy council.

Councillor Simon Myers, Executive Member for Finance, requested that there "is still some recognition of what some of the priorities of the previous councils were" when applications or bids for funding come in. He mentioned specific cases he wouldn't want to see jeopardised by the new process.

Exceptions to the default transfer of uncommitted balances to corporate funds will be reported to the Executive during 2025/26. The council states that being two years on, they have a "better sense of what our corporate priorities are".