Covid-19 has delivered a financial hammer blow as high as £6million to Angus Council’s budget in the first months of lockdown.
In a stark assessment of the pandemic’s cash cost, authority chief executive Margo Williamson will lay bare the early financial impacts of coronavirus and has delivered a warning there is “no scenario” in which the council’s longer term finances will emerge unscathed.
Council cash reserves will also probably have to be raided to a “significant extent” to steer the county through the crisis, the top official has said.
The chief executive forecasts Covid-19 recovery will be as challenging as anything faced in the past decade of council budget cuts and will include rising levels of bad debt, as well as increased staff absence over the next two years as services adapt to a test, trace isolate and support (TTSI) approach while a virus vaccine is developed and delivered.
Mrs Williamson’s joint report with council finance chief Ian Lorimer on the Covid-19 impact includes details of Angus support which has already included a £1.088m share of the £50m Scottish Government hardship fund, an estimated £3.3m from further Barnet Formula consequentials, £602,000 of the local government food fund and a £383,000 slice of the Scottish welfare fund.
It states: “At this early stage and on an indicative basis only, officers estimate the impact on the council’s budgets for the period March to June 2020 only could be between £4m and £6m.”
“The estimate assumes a successful furlough application for Angus Alive and that the majority of the £10.2m savings in the council’s change programme for 2020/21 can still be achieved, which is clearly a risk which officers are reassessing for reporting to committee in June.
“The implications of Covid-19 will be far reaching and long lasting and members should be prepared for a lengthy period of disruption to what we would consider normal operating arrangements.
“The council, working with Cosla, will continue to make the case for support to be provided but there is no scenario here which will mean the council’s finances emerge unaffected from this crisis.
“Members should be prepared for large scale revisions to budgets being required which are likely to include having to use the council’s uncommitted reserves potentially to a significant extent.
“Put simply, Covid-19 and recovering from it will be as challenging for the council and its partners as anything we have faced in the last 10 years when financial pressures and increased demand for services have been at their most severe.”
