East Riding of Yorkshire Council's financial outlook remains 'uncertain'
The authority says it is as coronavirus restrictions have left officers unable to say how much the authority can expect to earn going forward.
East Riding Council’s financial outlook remains “uncertain” as coronavirus restrictions have left officers unable to say how much the authority can expect to earn going forward.
East Riding Council’s finance lead Julian Neilson told the Overview and Management Scrutiny Committee officers were forecasting a balanced budget for this year.
But he warned uncertainty over how long coronavirus restrictions would last and their impact on council tax receipts and earnings from sales, fees and charges made long term planning difficult.
Mr Neilson said “unprecedented” government aid would ease “huge” pressures on budgets, adding he was confident the council could balance its books next year.
He said a strong pre-pandemic financial position would help it avoid following councils such as Croydon in issuing a Section 114 notice, the mechanism local authorities use to declare bankruptcy.
It comes as Mr Neilson said in an update in October the council could face a gap of around £10m in coming financial years due to the growth of a previously “manageable” £1.6m pre-pandemic deficit.
The comments also come as officers are due to present draft council budgets for the coming financial year before Christmas.
The committee heard the government had given the council £22m to cover extra costs incurred during the pandemic, with a further £1.55bn earmarked for councils next year.
Councillors also further discounts of £150 for council tax support claimants would be provided but that government funding for them had run out.
Mr Neilson said a further £4m had been received to reimburse lost income on sales fees and charges, with further funding also expected.
He added officers were putting the finishing touches on new support for businesses “severely impacted” by the pandemic, with further details set to be released in the coming days.
Mr Neilson said:
“The future’s very uncertain, we don’t know how long local restrictions will go on for and what the long term impact on the economy will be.
“Everything depends on the impact the pandemic has on the local and national economy, any losses we incur this year will impact on our budget for the next financial year.
“Prior to the pandemic we had a relatively robust financial position compared to other councils, we wanted to retain that for events like this.
“As we move into next year and beyond we’re looking at how we can use that resilience to continue to provide high quality services and help to the community.
“Government has provided unprecedented financial support to councils, they’ve confirmed they will reimburse 75 per cent of our losses from sales, fees and charges.
“We’re looking to present draft budgets before Christmas but we’re waiting on the local government financial settlement.”