Covid pandemic leaves fire bosses counting the cost
Fire chiefs have warned more Government cash may be needed to fill holes in balance sheets caused by the coronavirus pandemic.
The UK’s financial sector is increasingly feeling the strain from Covid-19, following the Bank of England’s decision to slash interest rates to a new historic low of just 0.1% earlier this year.
And now emergency service chiefs in Tyne and Wear have warned the fallout from this is likely to affect their own spending plans.
“A l t h o u g h [ o u r i nve s t - ments are] outperforming t h e b a s e r at e [ at t h e m o - ment], I don’t think that will
be maintained,” said Dennis N a p i e r, s t r at e g i c f i n a n c e manager at Tyne and Wear Fire and Rescue Service.
“Towa rd s th e later
stage of the financial year ( 2 02 0/2 1 ) we ex p e c t to b e £40,000 under budget as a d i re c t i m pac t o f th e rate s falling.
"As the year goes on and our reinvestment of income h ap p e n s th e rate s w i l l b e lower and our returns of investment will be lower.
“T h e go o d n ews ab out the £40,000 is the Government has provided additional funding for the impact of C ov i d a n d we ex p e c t th at loss to be met by government grant.”
Mr Napier was speaking at a meeting of the Tyne and Wear Fire and Rescue Authority’s Governance Committee, which was held by videolink and broadcast via YouTube.
Ac c o rd i n g to a re p o r t fo r th e pa n e l , th e auth o r - ity actually received about £100,000 more than it was expecting in returns on its investments during the first half of the financial year.
However, this was based on previous interest rates, prior to the most recent cut, and by the end of the current financial year investment return is likely to be £40,000 less than expected.
But th e re i s a l s o h o p e ministers may step in to provide some support.
Mr Napier added: “The pa n d e m i c w i l l h ave a rea l impact on our finances and that is unavoidable, unless the government provides additional funding.
“The Chancellor did mention this in his spendi n g rou n d l a s t we e k , th at [the Government] is going to provide £ 1.55billion for l o c a l aut h o r i t i e s , t o h e l p with the impact of Covid in 2021/21, and I expect the fire service will receive some of that funding.”