Council confident Holyrood cash will cover cost of Covid

Finance chiefs at Angus Council are confident government cash will pay for the multimillion-pound impact of coronavirus on the county.

But they are preparing for another dip into reserves for a budget to be set later this week which requires to plug an £11 million funding gap.

It comes as the authority’s wage bill has jumped by more than £10m during the pandemic year, to pay for a workforce which has seen an upturn in numbers.

Like neighbouring Dundee City Council, Angus meets on Thursday to lay out spending plans for 2021-22.

The ruling coalition administration has already said it will be freezing council tax after accepting a Scottish Government offer of £1.7m. That will see the area’s Band D rate pegged at £1,206.54 a year.

Finance director Ian Lorimer’s raft of reports include the comfort blanket that the Scottish Government cash will soak up the cost of coronavirus.

He said:“When the 2020-21 revenue budget was revised in September 2020 it was estimated the pandemic would have a net additional impact of £13.2m.

“At that time £9.5m of additional support from the Scottish Government had been announced and council agreed to use uncommitted general fund reserves and uncommitted early years grant funding to make up the difference (£3.7m).

“The position has moved on since September with clarification of the cost impact on the council and additional funding from government allowing the call on reserves to be reduced.”

He added: “Although the nature of the pandemic means the position remains unpredictable, the current expectation is that all of the direct financial impact from Covid-19 on the council’s 2020-21 revenue budget can now be met from additional government funding with the caveat some of this has still to be allocated at an individual council level.

“Realistically at this time, trying to predict what the pandemic will mean for the council’s budget would be little more than guesswork.”

A budget funding gap of £11.301m represents 3.8% of the council’s net budget.

The area has made savings of £66.1m (24%) in the last eight years but finance spokesman Angus MacMillan Douglas has warned: “The future for the council looks very challenging”. He added: “The sustainability of the current system of council funding and the services councils are asked to provide will have to be examined in the very near future.”

Using reserves of nearly £4m for either one-off or ongoing issues is part of the plan to ease the cash gap.