Coronavirus set to cost county council at least £68 million

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hcc coronavirus cost
HCC is counting the cost of the pandemic

THE coronavirus crisis is set to cost Hampshire County Council (HCC) £68m and the cost could go up, it has been revealed.

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According to the authority’s latest estimate, it will spend £68m in the 2020/21 financial year to respond and recover from the pandemic, writes Maria Zaccaro of the Local Democracy Reporting Service.

Loss of income and growing demand, especially in children and social care services, are the biggest challenges facing the council, civic chiefs said.

The news come as Hampshire has received a major cash boost worth £53m from central government over the past months.

HCC said it does not need to prepare an emergency budget at this stage but cabinet members will consider a report on the financial impact of Covid-19 at a meeting next month.

The Conservative-run authority said its net revenue budget for 2020/21 is £795m and it expects its total usable reserves to be around £575m in 2019/20.

However, of this amount 96.1% is earmarked for a specific purpose, the council said, with unallocated reserves standing at £22m.

Cllr Keith Mans
Cllr Keith Mans

HCC leader Cllr Keith Mans, of Brockenhurst, said: “As anticipated, our response to the fast-moving Covid-19 pandemic is incurring additional costs for the county council – which we continue to monitor, and we regularly report our financial forecasts to central government.

“There will also be further costs and losses associated with the recovery phase of the crisis, such as increased demand for social care support, and efforts to restore the wellbeing of Hampshire’s communities and the economy.

“However, it is difficult to predict with absolute certainty the costs that we may face beyond the end of June, and our recovery and demand costs can only be speculative at this stage.

“We will be undertaking further work to explore the evolving financial picture in greater detail – in particular, as we emerge from lockdown over the coming weeks and months.”

As reported, last month Liberal Democrat Cllr Alan Dowden raised concerns over the future financial position of the county council after a report revealed that by the end of June the authority may have to foot a £96.2m bill.

The amount includes the estimated cost of the response until the end of June as well as savings the council had already planned to make.

A spokesperson for the Ministry of Housing, Communities and Local Government said: “We have provided an unprecedented package of £27bn to support local councils, businesses and communities in fighting this pandemic.

“We will continue to work closely with councils across the region to develop an ongoing assessment of costs as they support their communities through this national emergency.”

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