Agenda item

That it be noted that:

(a)  An initial financial assessment indicates that the gross costs of Covid-19 to the Council may reach £15.3 million.

(b)  Currently, the Government grant to cover Covid-19 costs is insufficient, covering less than half the estimated costs. It amounts to just £7.6 million. This leaves an initial funding gap of £7.7 million.

(c)  Expenditure reductions of £4.8 million have been identified to partly offset this, leaving a possible £2.9 million adverse impact on general reserves.

(d)  The forecast shortfall in funding can be contained within forecast general reserves for 2020/21 although any further pressures, if realised, could lead to general reserves dipping below the recommended minimum, which could lead to the need for a freeze on all non-statutory spending.

(e)  The financial situation needs to be monitored very closely, acknowledging that current estimates remain provisional because the full impacts of the virus are still emerging.

The Service Lead Finance introduced a report that detailed the financial implications of Covid-19.

It was estimated that the gross cost to the Council may reach £15.3m and the Government grant of £7.6m so far was therefore insufficient to cover the increased expenditure.  The gap of £7.7m was offset by spending reductions of £4.8m which meant an possible £2.9m adverse impact.  The figures presented were provisional and there was considerable uncertainty as the situation was changing on a daily basis.  The Cabinet was assured that the forecast shortfall could be contained with forecast general reserves for 2020/21, however any further pressures, including the Slough Children’s Services Trust debt position, could result in general reserves dipping below the minimum level.  The financial position was been closely monitored to understand the full impacts over time, particularly as the length of ‘lockdown’ was uncertain.

The Cabinet discussed the main financial pressures which included adult social care workforce and PPE costs, homelessness and reduced leisure, parking and commercial income.  Lead Members commented that as a result of a track record of strong financial management SBC was in a relatively good position compared to other authorities.  However, the pressures and risks were substantial both in the short and medium term given the possibility of further waves of infections and increased costs and demand on Council services.

Speaking under Rule 30, Councillor Strutton asked questions about care costs and the risk to commercial income from assets in the strategic acquisitions programme.  These points were answered and any individual cases could be picked up outside of the meeting through appropriate channels.

At the conclusion of the discussion the report was noted.

Resolved –  That it be noted that:

(a)  An initial financial assessment indicates that the gross costs of Covid-19 to the Council may reach £15.3 million.

(b)  Currently, the Government grant to cover Covid-19 costs is insufficient, covering less than half the estimated costs. It amounts to just £7.6 million. This leaves an initial funding gap of £7.7 million.

(c)  Expenditure reductions of £4.8 million have been identified to partly offset this, leaving a possible £2.9 million adverse impact on general reserves.

(d)  The forecast shortfall in funding can be contained within forecast general reserves for 2020/21 although any further pressures, if realised, could lead to general reserves dipping below the recommended minimum, which could lead to the need for a freeze on all non-statutory spending.

(e)  The financial situation needs to be monitored very closely, acknowledging that current estimates remain provisional because the full impacts of the virus are still emerging.