Fears for services as county could face £120m cuts on top of £210m coronavirus bill
CONCERNS have been raised over the future of services in Hampshire as millions of pounds may have to be saved over the next few years on top of a £210m coronavirus bill.
Hampshire County Council could have to save as much as £80m by 2023, it has been revealed, writes Maria Zaccaro of the Local Democracy Reporting Service.
The numbers could rise to £120m by 2024 if the savings programme needs to be extended.
The news comes as the council could face – by 2023 – a £210m bill from the costs, losses and financial pressures related to the Covid-19 pandemic. Of this, £103m is currently unfunded, the council said.
A report published by the authority has revealed that the financial implications of the coronavirus crisis on the county council’s own budgets and financial planning “will be profound”.
But civic chiefs said the £80m worth of savings the council could be forced to make by 2023 is not related to the pandemic.
The authority said at this stage the figure is an estimate and could change.
But an official report showed that should the council have to find the £80m savings by 2023, it would save £40.6m from adult health and care; £20.5m from children’s services (non-schools); £10.5m from the economy, transport and environment department; £3m from culture, communities and business services; and £4.9m from corporate services.
When asked how many jobs would be at risk, the authority said it had no idea at this stage and “it is far too early to speculate”.
The council said the prospect of further savings is “just a possibility” at this stage but it was “unlikely” it will have none to make.
The council has already said the cost of inflation and demand pressures outstrip additional council tax income by about £40m every year.
As reported, earlier this year the authority backed a plan to save £80m by 2021.
This could result in the closure of eight libraries and the loss of about 200 jobs.
Civic chiefs have pledged to continue to lobby the government to fund the cost of the coronavirus crisis.
The government said it has given councils “unprecedented support”.
But opposition leaders have raised concerns over the council’s future financial position.
Opposition leader Cllr Keith House said: “The Conservative Party has to take full responsibility for the mess that the county council is in. We already have the prospect of library closures. This points to the closure of local tips, museums, more libraries, an end to bus services and an even bigger backlog of road and pavement repairs.”
Civic chiefs have urged the government to “honour its previous commitment to fund the financial consequences of Covid-19”.
Cllr Alan Dowden said: “Now they have spent that money and they are reneging on these promises. I think it’s disgraceful. I am worried not only for services for the county, I am worried for the nation.”
Council leader Cllr Keith Mans said: “Based on the reductions in our funding as well as the ongoing demand pressures, it’s inevitable that we will continue to face budget pressures in future years.
“Anticipating what future budget pressures might look like is a key part of careful and prudent financial planning. At this stage, in the absence of any detailed information, the best forecast we have at the moment is an annual shortfall in funding of an estimated £40m.
“However, these are financial predictions only, based on our experiences to date. It is far too early to speculate on actual figures – particularly during the fast-moving Covid-19 pandemic.”
Cllr Mans said last week’s announcement of a consultation on the next Comprehensive Spending Review covering the next three years is “very welcome”.
He said this means the council will be much better placed to consider its medium-term position once more details are released.
However, he added: “But in Hampshire our medium and long-term financial sustainability relies on central government compensating councils fully for all the extra costs and losses from Covid-19.”
The minister for regional growth and local government, Simon Clarke, said the government has provided councils with a £4.3bn package.
He added: “Hampshire County Council has been allocated £61.61 million of this additional funding and it also has access to a new government scheme that will compensate councils for irrecoverable income losses from sales, fees and charges. In addition, its core spending power rose by £55.01 million this financial year even before additional emergency funding was announced.”