The challenging budget situation currently faced by Calderdale Council will be discussed by Cabinet Members when they meet on Monday 3 August.
Members will consider the first quarterly revenue monitor report of the current financial year. Regular revenue monitoring allows the Council to forecast what the cost of delivering its services will be by the end of the financial year and compare this to the money it has available to spend.
The report forecasts a current overspend across the Council of £17.7million. Of this, £13million is estimated to be related to COVID-19.
The report identifies the main pressures on the Council’s overall budget, with the Public Services directorate and Adult Social Care facing particularly significant financial impacts as a result of COVID-19. The report indicates the Public Services directorate has an estimated funding gap of £7.6million directly related to the effect of the virus. A major factor in this is the loss of income due to the closure of sports facilities and libraries during lockdown.
The pandemic has also caused higher demand for home care and other adult social care services, with Adults and Wellbeing Services reporting over £3.6million in additional spend due to COVID-19. The Council’s efforts to help to support the care market and costs relating to PPE have also impacted the budget position. It has been essential to increase Council spend in these areas to protect those most at risk and the community as a whole.
The Council was already facing significant budget pressures prior to the COVID-19 pandemic and some of the actions planned to improve the position have been delayed due to COVID-19. Directorates will continue to implement agreed savings and take further action to manage budgets. This will include taking opportunities to transform how services are delivered, building on the innovative approaches developed during lockdown.
It will not be known until the end of the year what the exact impact of COVID-19 (or underlying pressures) will be. A further review of the financial position will be reported to Cabinet in September along with any emergency budget decisions required, when the extent of further government support should be clearer. Cabinet will also be considering in September the Medium Term Financial Strategy, which will provide a forecast of the impact of COVID-19 and other service pressures upon the Council’s financial position in future years.
The Leader of Calderdale Council, Cllr Tim Swift, said:
“Before the pandemic took hold, Calderdale Council – like other local authorities – was already facing severe financial pressures. Whilst the situation is increasingly challenging, we’re doing all we can to manage the impact of the virus both on our communities and our budget.
“We’ll continue to closely monitor the Council’s financial position, make savings, develop innovative service responses and adapt how we operate where we can. However, it’s clear that further government support is required to meet the ongoing financial challenges. If this funding is insufficient, it is likely we will need to identify additional savings, use our limited reserves in the short term and potentially implement an emergency budget.”
The Council’s revenue monitoring report will be discussed at Calderdale Council’s Cabinet meeting on Monday 3 August 2020. The meeting will be held virtually from 6pm and will be live streamed through the Council’s YouTube channel.