Agenda item

Summary:

Options considered:

The coronavirus COVID-19 pandemic represents a monumental challenge for the District Council which will inevitably have a significant impact on the Council’s resources and budget during 2020-21 and future years.

This report provides an overview of the current assessment of the emerging financial impact of COVID-19 which will have a profound impact on the organisation’s ability to achieve planned budget savings and income for 2020-21 onwards. It also considers the COVID-19 funding provided to date from government and the extent to which this will support the current financial pressures.

An update is also provided in relation to the support provided to local businesses through the Small Business Grant scheme and the various additional business rate reliefs announced.

The Council is proactively responding to the challenge of the COVID-19 pandemic to maintain the delivery of vital front line services whilst at the same time freeing up capacity to help, support and protect vulnerable people, supporting businesses and ensuring the safety of all of our staff whilst delivering this vital work.  

This report sets out the initial high level forecasts relating to the COVID-19 pandemic but at this stage there are no specific alternative options considered.

Conclusions:

This report provides an overview of the current assessment of the emerging financial impact which will have a profound impact on our ability to achieve savings and income for 2020/21. In addition, it helps to set the context for the Council’s MTFS and budget planning process for 2021/22, which will be reported to Cabinet later in the year.

The Council faces an unprecedented financial and public health crisis. It will be essential to continue to engage with Government, MPs and other stakeholders to campaign for adequate and sustainable funding for the District so that we can continue to deliver vital services to residents, businesses and visitors.

The current pandemic demands very different ways of working and will require review and consideration of current and future priorities. Looking beyond the immediate impacts, the overall level of uncertainty means the financial environment remains extremely challenging for the foreseeable future. The assumptions upon which both the Medium Term Financial Strategy (MTFS) and the 2020/21 budget are based have now been significantly undermined by the current crisis and will necessitate a fundamental review of the budget position given the current funding pressures.

The current projected budget position (c£1m deficit 2020/21) is constantly changing and therefore the high level projections contained within this report must be seen in this context and could be subject to significant change depending on further announcements over the coming months.

Recommendations:

Reasons for

Recommendations:

It is recommended that Cabinet note:

1.            The current package of financial support being provided to the Council by the government to support its response to COVID-19;

2.            Continues to lobby central government for further additional financial support;

3.            The forecast cost and income pressures being faced by the Council and the extent to which they exceed the available government funding and therefore the requirement for any deficit to be funded from other Council resources;

4.            The various caveats and risks associated with the current forecasts;

5.            The proposals in respect of updating the Medium Term Financial Strategy (MTFS) and the financial planning framework for the 2021/22 budget;

6.            The proposals for a fundamental review of the capital programme to ensure that the schemes still reflect the Council’s changing priorities and to ensure that the Council can still afford them given the rapidly changing financial landscape;

7.            The proposal for a further financial update to come forward to Cabinet in July, by which time there will hopefully be more clarity regarding any continuing restrictions to include;

·                Opportunities for re-prioritising and re-focusing currently approved 2020/21 budgets;

·                Opportunities for savings, efficiencies and income generation this year;

·                A review of the current reserves position with recommendations for re-allocation where appropriate and;

8.            The progress to date in respect of the application of the various new business rates reliefs announced along with progress towards the government funded Small Business Grant programme which local authorities are being asked to administer (Appendix D).

To make Members aware of the current COVID-19 position in respect of the Council’s budget and resource position for 2020/21 and indeed future years.

Cabinet Member(s) Cllr Eric Seward

Ward(s) affected

All