Leader admits county council faces ‘great big hole’ in budget due to coronavirus pandemic
- Credit: Archant
The leader of Cambridgeshire County Council has said the authority is facing “a great big hole” in its budget following the latest published estimate of the impact of the pandemic on its finances.
County council documents show a mixture of additional costs, lost income and impaired savings plans all add up to £50.7 million.
An extra £26 million in emergency Government support, as well as expected reimbursements from the NHS, still leave the county council with a projected £13.6 million gap in its budget.
A council report on the issue says: “Were no further funds to be forthcoming, as a last resort, the council holds general reserves partly in case of emergencies.”
The council has around £18 million in its general fund reserves, but there are “other extant risks that the balance is held to mitigate”.
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Councillor Steve Count, leader of the council, told the general purposes committee on Tuesday (June 2), that the county is in a better position than some other councils, which he said may need to issue a bankruptcy notice.
Cllr Count said: “There’s over £50 million over and above our budget, either spent or predicted to spend, and that just takes us to the end of the summer.
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“We don’t know moving forward how much more that will be. We know that £10 million is coming in from other sources, £26 million has come in from government, leaving a £13 million gap.”
Mentioning the reserves, he said: “I think what we’re trying to say is, at this particular point in time we have a way of dealing with this.
“There are other councils looking at their finances at the moment, and they are in deep discussions with their section 151 officer – that’s the chief finance officer – as to whether to issue a section 114 notice – a bankruptcy notice – or whether they can keep their finances in a good place, so that they are not issuing, publicly, a bankruptcy notice.”
He added: “We’re not flippant that £13million, or however much it may be, is a great big hole in our finances – and the general reserves can cover it. We are in intense conversations going on internally as well as at a national level with government to explain that this amount of money is not easy to find and it is only a temporary measure if we have to use the general reserves. But we are not in the same situation as many others.”
Cllr Count told the same committee on May 14 that the council has “a significant, very real, very sizeable funding gap” caused by the pandemic and subsequent measures.
He said then: “As we move through the year, as we can’t borrow, we will be forced to make decisions about how to fill that funding gap, unless that is further dealt with by the Government.”
Councillor Lucy Nethsingha, leader of the Liberal Democrat opposition group, supported the council’s handling of the crisis so far at the committee meeting on Tuesday, but said that she has “extremely serious concerns about the way the government is managing the easing of the lockdown”.
Cllr Nethsingha told the council leader: “I support you Steve in saying our council is managing this as well as they possibly can under the circumstances.”
She criticised the Government’s “mixed messages” and the Dominic Cummings “debacle” and linked the two to reports of crowds in public spaces.
“Watching that breakdown of the consensus of lockdown has been really difficult,” she said.
Cllr Nethsingha said her “major concern” is the government is easing lockdown “too fast”. She also called for more information on track and trace.
Conservative councillor Anna Bailey defended the Government’s handling of easing the lockdown.
Cllr Bailey said: “The lifting of the lockdown is inevitably going to be more difficult than announcing a lockdown. As time goes on, we absolutely have to start lifting the lockdown.
“People cannot stay away from school for the next two years or however long it takes to find a vaccine or get better treatments, people cannot stay away from their jobs for all that time, so it is absolutely inevitable that we have to start lifting the lockdown.
“It’s easy to criticise when it starts happening, but it’s a much more nuanced thing, and it has to happen in careful stages, which I think it is. But it’s more difficult messaging.”
Cllr Count said “today’s committee meeting is about how this council handles itself and how we are able to help the residents of Cambridgeshire,” and said he was “disappointed” the discussion had at one point moved onto the Government’s response.