There is a huge amount of uncertainty over future Council finances due a lack of clarity over Government support and an unclear picture of how long the Covid crisis will last – a meeting has heard.
At Bradford Council’s last Executive meeting members were given an update on the Council’s Medium Term Financial Strategy – which looks at finances for the coming year.
Andrew Cross, project accountant, told members that the financial gap facing the Council would be £47.9 million in 2021/22 and £42.3 million in 2022/23.
But one Councillor pointed out that future finances were “completely unknown” as additional government funding could dramatically change the situation overnight.
The Council’s financial pressures are due to a number of issues, including an increased spending on public health, supplying PPE and increased pressures on Children’s and adult’s social services, as well as plummeting income from Council facilities like car parks, leisure centres and theatres. Income from Council Tax is also expected to fall as more people claim Council Tax reduction due to rising unemployment levels.
Members were told that the gap could be closed in a number of ways – through additional money from the Government, cuts to Council services, boosting Council income or through one-off dipping into reserves.
Mr Cross said there were a number of other uncertainties beyond the impact of Covid – including how Brexit will effect Council finances.
The gap in the 2021/22 budget will legally have to be filled by February.
At the meeting, which was held virtually, Council Leader Susan Hinchcliffe said: “This is a blow to finances when you see how much has to be spent on safeguarding our residents.
“The lack of clarity from Government is astonishing really.”
She said the Government had relied on local Councils to spend cash to halt the spread of Covid, but had yet to fully fund those measures.
She said: “We do have a gap in our budget, we’re not the only Council, and the Local Government Association is lobbying for the government to help fill that gap.”
Councillor Mike Pollard (Cons, Baildon) said: “Council finance officers have an unenviable job, and I don’t really criticise them for their message of doom.”
But he pointed out that there were many “unknowns” about the financial support being offered to Bradford and other local Councils, and upcoming Government support may well reduce the financial pressures.
He said: “This version of the medium term financial strategy is nothing of the sort. The medium term outlook is unknown and unknowable.
“I hope we don’t see hysterical headlines in the press about a £47 million financial gap – because this report doesn’t identify anything of the sort. They are a series worst case scenario guesses.
“If support is offered to Bradford Council by the Government is anything similar to the support offered in the first half of the financial year then the future won’t be as bleak as presented in this report.”
Cllr Hinchcliffe replied: “Officers have a fiduciary duty to advise the Council according to accountancy rules. It is undeniable the Government has left us with a lack of clarity heading towards the budget in February.
“There are a whole range of issues they haven’t addressed.
“It is normal to take facts and respond to them accordingly. We have to be sited on what could happen – that is being responsible.”