SOMERSET County Council’s improved finances have been recognised by auditors, according to a report which is set to be discussed next week.

The Value For Money update report from Grant Thornton, which will be considered by the council’s Audit Committee, notes significant progress and the “positive trajectory” of the authority’s financial position and planning.

In 2017/18, auditors gave the county council an ‘adverse’ Value for Money conclusion but for 2018/19 they have given an improved rating (‘qualified except for’) which recognises the improvements the council has made but also that more still needs to be.

In July, auditors gave the council’s financial statements for 2018/19 a clean bill of health but they said they needed further assurances before reaching a conclusion about how robust the council’s finances were for future years.

This is what auditors refer to as value for money - especially in the big budget areas of Children’s and Adults services.

Having carried out additional work, they have concluded that both Children’s and Adults services have stronger financial measures in place with robust mechanisms to manage and monitor spend against budget.

The auditors said they are satisfied that sufficient progress has been made since 2017/18 and are reassured by the higher levels of reserves.

But independent external auditors Grant Thornton also said in their report: "The Council has increased its general fund and earmarked reserves from £23.7 million at March 31 2018 to £44.2 million at March 31 2019 (excluding school reserves).

"Despite this increase, these levels of reserves remain low in comparison to similar councils and provide limited capacity to absorb unexpected future financial pressures.

"These matters are indicative of weaknesses in the Council’s arrangements for strategic financial planning. They are evidence of weaknesses in proper arrangements for sustainable resource deployment in planning finances effectively to support the sustainable delivery of strategic priorities and maintain statutory functions." 

Councillor Mandy Chilcott, cabinet member for resources, said: “Given the pressures on local government finances, to have this progress acknowledged by the auditors is very welcome.

“There is still room for improvement and we have to continue to work hard and make sure we can provide the best possible services while living within our means and staying within our budgets.

“We will also continue to lobby for sustainable funding. It’s good to see the Government listened to our concerns in the recent spending round, but that’s only for one year – what is really needed is a longer-term, sustainable plan especially for social care.”

But Cllr Mike Rigby, said while he is pleased the county council's finances have improved it remains in a 'fragile financial state' 

He said:  "Whilst there are improvements, the County Council remains in a fragile financial state, with the external auditors questioning whether the reserves are yet high enough to withstand unexpected shocks, like a No Deal Brexit. The forward budgeting is not yet robust enough to guarantee that statutory services like elderly care can still be delivered sustainably and even at current low levels. On this basis, Council taxpayers can expect an extra 2% on their Council Tax for social care as the Government is too tied up with Brexit to sort out fair care funding for Somerset."

The Auditor’s report will be discussed at the meeting of the Audit Committee on 19 September.