Covid to cost council £34m

THE coronavirus is expected to cost Coventry City Council around £34 million in total.

Barry Hastie, director of finance and corporate resources, made the admission during a meeting of the authority’s scrutiny committee on Wednesday, June 17.

While the council has so far received around £21 million in additional grant funding to offset some of those pressures, that could see a potential £13 million loss to the council’s finances.

Even prior to the pandemic, Coventry council said it was facing a deficit of nearly £19m next year, increasing to almost £31m the year after that.

Mr Hastie said: “We are making financial returns to government and our forecast assessment of the cost of the pandemic is something around about £34 million to the local authority.

“That’s a combination of costs and income we will lose as a result of the pandemic.”

Mr Hastie said the £34m is a forecast assumed on a fourmonth period of disruption until the end of July, taking into account additional spending pressures in areas such as social care and PPE, and loss of income from areas including car parking and business rates.

The city council also has a large property portfolio and has splashed out millions on the likes of Coombe Abbey and most recently disposal firm Tom White Waste in a bid to return more revenue longer term to help balance future budgets.

However he warned the impact on commercial property and investments is not yet clear.

“That could be in companies where we expect dividends such as the Birmingham Airport or Waste Disposal Company,

and also in commercial property from city centre shops or industrial parks,” he said.

“There is a hard-line view that you have made those investments, you can’t expect national government to subsidise you should they not turn out to be good investments for whatever reason.”

Mr Hastie added: “We really couldn’t have more uncertainty in the system than we have at the moment.

“I think we will start to get a bit more clarity in the short to medium term about how some of those parameters get reset. We are expecting financial announcements in July.

“We are confident there will be a robust financial strategy for the medium term.”