Council facing £11m budget black hole as Covid-19 batters finances

Fife Council is facing an £11 million budget shortfall as it weathers the Covid-19 storm.

The local authority’s policy and co-ordination committee heard yesterday that the economic impact on the council has been revised downwards by around £3m from an initial £76m a few months ago.

But the move to Level 4 restrictions will increase pressure on finances.

Among the biggest impacts are the expected loss of £20.4m of building ser vices income, £ 7m from unused facilities such as village halls, and £1.8m in car parking fees.

The council has also paid £ 1.5m on homeworking equipment to ensure services could be delivered by staff remotely.

The year- end gap is forecast at around £11m, which will need to be plugged by budget decisions next month.

Eileen Rowland,

executive director of finance and corporate services, said the authority cannot be complacent in the final months of the financial year, even as more external support becomes available.

While an estimated £4.6m of funding from the Scottish Government is expected, Ms Rowland said there are still areas of overspend in which means of balancing finances have not been identified.

“It is clear that the quantum of funding av a i l a b l e for loss of income across Scotland is unlikely to cover the full extent of income lost over the year,” she said.

“On this basis negotiation and dialogue will continue between Cosla , Scottish Government and the UK Government in relation to the consequentials that will be passported to councils.”

Lockdown will further stretch council finances.