Council predicts £4.5m black hole in finances
- Credit: East Suffolk Council
East Suffolk Council has forecast a £4.5million hit on its finances this year as a result of coronavirus, but bosses say that it is in a stronger position than most authorities.
Councils across the country are facing revisions to their budgets as the coronavirus pandemic has meant more money needs to be spent on addressing the pandemic, while council incomes have also taken a hit.
Among the additional costs have been temporary accommodation for homeless people during lockdown and sourcing PPE, while the income lost was that from gyms, parking and theatres among others.
MORE: Suffolk County Council finances latestEast Suffolk Council’s Conservative cabinet member for resources, Maurice Cook, said that following the latest wave of government support it was expecting a financial hit of £4.5m this year, and £3.2m next year.
He said: “The financial impact primarily concerns the council’s own income sources – especially car park and planning income – whereas next year the estimated impact primarily concerns council tax and a rise in the number of people on the council tax relief scheme with increasing unemployment.”
Mr Cook said the strong level of reserves meant it should be able to absorb some of the cost pressures.
Council leader Steve Gallant said: “We find ourselves in a relatively comfortable position compared to many, many other local authorities across the country and that is absolutely down to not only the clever way that East Suffolk Council has managed its finances, but we should profess our gratitude to our previous authorities [Suffolk Coastal and Waveney councils, which merged in 2019 to become East Suffolk Council].
“Without that good way they left the finances we wouldn’t be in the position we are in today.”
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Mr Gallant added that he was encouraged by the support central government had offered to date.
West Suffolk this week predicted a £10m hit on its finances, while Ipswich Borough Council has announced planned cuts to its Waterfront gym and Tourist Information Centre to cushion the blow of the £10m black hole it is forecasting.
Suffolk County Council as an adult care provider has faced soaring costs from the coronavirus response, and in its latest estimate is expecting a £23m shortfall by the end of the financial year.
MORE: Ipswich council reports worst financial crisis in 45 yearsHowever, the situation remains fluid for all councils, with some more support anticipated from central government over the coming weeks and months.