This is an HTML version of an attachment to the Freedom of Information request 'Liverpool City Council reserves'.

Enquiries to: 
Information Team 
Our Ref: 
FOI 521865  
Dear Mr Smith 
Freedom of Information Request 521865 
Thank you for your recent follow up request received on 15 June. Your request was 
actioned under the Freedom of Information Act 2000 in which you requested the following 
information – 
The Local Government Association (LGA) advises that some council reserves 
'restricted by local agreement to fund certain types of expenditure can be 
reconsidered or released if the council's future plans and priorities change' (LGA, A 
councillor’s workbook on local government finance, March, 2018, page 24). 
These reserves are sometimes referred to as 'controllable' earmarked reserves 
(Liverpool City Council, page 82, paragraph 6.4). 
I have four questions. 
1.  How much does Liverpool City Council currently hold in 'controllable' 
earmarked reserves? 
2.  In principle - i.e. if deemed necessary by councillors - can Liverpool City Council 
release/reallocate its 'controllable' earmarked reserves and spend them on a once-off 
basis to support service provision? 
3.  How much does Liverpool City Council currently hold in 'general' reserves? 
4.  If deemed necessary by councillors, can Liverpool City Council spend its 
'general' reserves on a one-off basis to support service provision? 

As at 31st March 2019 Liverpool City Council has earmarked reserves totalling 
£124.278 million. These reserves are to fund future expenditure plans and to mitigate 
financial risks. Not all earmarked reserves are available for general use by the City 
Council and a number have been created to satisfy specific statutory and legal 
provisions. Therefore, not all of these are ‘controllable’ in the true sense of the word. 
A total of £49.421 million relates to specific statutory and legally restricted reserves 
and £7.241 million is already being used to support the 2019/20 budget.  
The £49.421 million specific statutory and legally restricted reserves includes 
£26.851 million relating to grant income that has been received in advance and 
where the related expenditure has not yet been incurred. The City Council could 
face legal challenges or future sanctions from funders if the grant income is not 
spent in accordance with the stipulations outlined in the grant agreement. 
  Liverpool City Council Information Team 
Cunard Building, W ater Street, Liverpool, L3 1AH 

It also includes £22.570 million relating to school balances or amounts held on behalf 
of schools and other organisations, such as the Merseyside Port Health Authority, 
that are not available for general use by the City Council. 
This leaves reserves of £67.616 million relating to specific schemes or risks. The 
specific scheme reserves (totalling £31.233 million) relate mainly to expenditure and 
funding commitments that have been re-phased from 2018/19 to 2019/20 and future 
years. These reserves include adult social care and health reserves where the City 
Council receives monies from health organisations to fund specific joint projects. 
These projects span financial years and relate to specific service provision and 
therefore the funding is required to be carried forward from one financial year to 
The remaining £36.383 million represents earmarked risk reserves to mitigate the 
anticipated financial impact of a number of identified risks including the potential 
clawback of government grant received and potential liability claims that may arise 
in the future. 
The earmarked risk reserves are held to mitigate specific risks that have been 
identified as part of the budget planning and risk management processes. If these 
earmarked risk reserves were to be spent on a one-off basis to support service 
provision during the year, then it is likely that they would need to be replenished the 
following year in order to underpin and support that year’s budget. In most cases it is 
difficult to forecast when these reserves will be needed but they are an essential 
component of a robust budget. Reallocation of the specific scheme reserves could 
jeopardise ongoing projects, including joint projects, were significant sums may 
already have been incurred or committed by the City Council or its partners. 
As at 31st March 2019 Liverpool City Council has a general reserve, or General Fund 
Balance, of £16.310 million. 
The General Fund Balance represents general resources available to the City Council 
to act as a contingency to help cushion the impact of unexpected events or 
emergencies. It is available for both capital and revenue purposes. This level of 
general reserve is deemed appropriate given the size of the City Council’s budget and 
an assessment of potential risks. If the general reserve was spent on a one-off basis 
to support service provision during the year, then it would need to be replenished the 
following year in order to underpin and support that year’s budget. Under Section 25 
of the Local Government Act 2003, the Authority’s Chief Finance Officer is required to 
report on the robustness of the estimates made for the purposes of the budget 
calculations and the adequacy of the proposed reserves. Any budget that did not 
include an appropriate level of general reserves would not be robust. 
Further detail on the reserves held by Liverpool City Council as at 31st March 2019 
can be obtained from the ‘Statement of Accounts 2018/19’ which is available on the 
City Council’s website at the link below: 
This concludes our response. 
The City Council will consider appeals, referrals or complaints in respect of your Freedom of 
Information Act 2000 and you must submit these in writing to within 28 days of receiving your response. The matter 
  Liverpool City Council Information Team 
Cunard Building, W ater Street, Liverpool, L3 1AH 

will be dealt with by an officer who was not previously involved with the response and we will 
look to provide a response within 40 days. 
If you remain dissatisfied you may also apply to the Information Commissioner for a decision 
about whether the request for information has been dealt with in accordance with the 
Freedom of Information Act 2000. The Information Commissioner’s website is 
and the postal address and telephone numbers are:- Information Commissioner’s Office, 
Wycliffe House, Water Lane, Wilmslow, Cheshire SK9 5AF. Telephone: 0303-123-113.  Email 
– (they advise that their email is not secure) 
I trust this information satisfies your enquiry.  
Yours sincerely 
A Lewis 
Angela Lewis 
Information Team 
  Liverpool City Council Information Team 
Cunard Building, W ater Street, Liverpool, L3 1AH 

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