Wigan Council: Cuts to services not needed next year despite Covid-19

Cuts to council services will not be necessary in the next financial year despite the impact of the coronavirus crisis, Wigan council’s finance chief has said.

The council may need to use some of its reserves to balance the budget and external auditors have warned that these reserves will need to be replenished.

However, Wigan council is now in a ‘relatively positive position’ following the government’s provisional financial settlement announced before Christmas.

It comes after town hall bosses said they would recommend a rise in council tax for the first time in seven years to plug a £25m shortfall in the budget.

But addressing the audit committee on Thursday, deputy chief executive and chief finance officer Paul McKevitt said Wigan’s position is ‘greatly improved’.

He said: “We’ll be taking a report to cabinet in February. I don’t see that we’ll be reporting anything significant in terms of changes to our services. I think the work that we’ve done throughout the pandemic has put us in a good position.

“I don’t want to say too much because it’s subject to cabinet approval. But just to give you some assurance, there won’t be anything in terms of service cuts or any consultation on any issues like that. So a relatively positive position.

“Some work to do, but a lot better than we were expecting in the summer.”

The comments came as external auditors revealed that Wigan council’s accounts for the year ending March 2020 have still not been signed off.

Karen Murray, partner at Mazars LLP, told the audit committee that there are still some outstanding issues relating to the valuation of the council’s assets.

But she told councillors that there is ‘nothing in there that you need to be particularly concerned about’ and the accounts would be signed off soon.

The auditor also warned the committee that the council ‘will probably’ need to spend some of its reserves which are not being replenished at the rate they would usually be by the dividend from Wigan’s share of Manchester Airport.

She said: “Wigan doesn’t take the airport dividend into account in any particular year when setting its budget and that’s right and proper.

“What the airport dividend does do though is go into your reserves.

“I think the important thing to bear in mind is when you’re not getting the airport dividend at the levels that you were, the ability to replenish your reserves should you dip into them – because you have demand or other cost pressures – is of course a pot that will run dry.”

The audit committee agreed to endorse the audit completion report.