Financial impacts of coronavirus revealed by council
- Credit: Archant
Plans to plug a funding gap of almost £30million have been revealed by North Somerset Council as it attempts to recover from the coronavirus pandemic.
Cost pressures and loss of income have created a gap of almost £30million in the council budget, which is equivalent to a 20 per cent shortfall.
A report presented to the council’s executive committee on July 29 detailed the deficit, with lost income of £7.4million, additional spending pressures of £10million, £1.4million depleted from savings, an £8.3million deficit on council tax and business rate collection fund, while non-coronavirus cost pressures of £2million created a gross financial gap of £28.8million.
The funding gap could be reduced to a potential of £5.1million through £11.9million of funding from central Government, a collection fund adjustment that defers pressure to future years, an additional £2.8million worth of savings and utilising £750,000 of general reserves.
A third trenche of Government funding announced in July and worth £1.5million may yield the remaining £5million the council requires to balance the budget for the current financial year.
You may also want to watch:
Cllr Ash Cartman, the council’s executive member for finance and performance, said: “While the budget may be balanced this financial year in no way is this the time to celebrate.
“We still face substantial in-year risks and severe medium-term financial challenges.
- 1 PICTURES: New supermarket opens at shopping district
- 2 Gale force winds expected to hit North Somerset
- 3 Party in the Park event returns to Weston
- 4 Water Adventure Play Park's water is off again
- 5 Pub fun day raises hundreds of pounds for charities
- 6 Weston's Marine Lake to remain closed due to safety concerns
- 7 Council backs call to improve poor health in seaside towns
- 8 Cinemas reopen after easing of lockdown restrictions
- 9 Weston's youngest graffiti artist helps football club with mural
- 10 Live at the Quarry is 'great success'
“Although central Government funding is very substantial and welcome, it is not enough. We face a significant problem next year which has been made worse by the Government’s lack of action.
“We continue to face a great deal of uncertainty and risk within these numbers, which may mean we have to come back later in the year with further amendments and changes.”
Risks not included in the report but are being monitored, which, if manifest, include early modelling of home to school transport to take into account social distancing, which indicates an additional cost of £1.5million.
The executive unanimously approved the report, and an updated budget for 2020/21 will go before full council in September.
Leader of the council, Don Davies, added: “The challenges for this and next year are quite difficult.”