A heavy financial burden – County Council Cabinet to review latest Covid costs to Hampshire

Members of Hampshire County Council’s Cabinet will hear next week, how the financial impact of Covid-19 will weigh heavily on the Authority’s budget setting considerations for 2021/22 and beyond

Nov 16 2020

At their meeting on 24 November, the Cabinet will receive the latest update on the financial position for the County Council in view of the impact of the Covid-19 pandemic – which has seen the Authority incur significant unplanned costs, as well as lost income and council tax revenues.

Leader of Hampshire County Council, Councillor Keith Mans said: “The financial picture is hugely complicated, not least because of the fast-moving nature of the Covid-19 pandemic which renders the situation very fluid – so it’s difficult to make accurate predictions on the short and medium term consequences of the virus.

“One thing has remained consistent, Hampshire County Council’s strong track record in managing its finances, which has meant we have been able to cover the £39.7 million of unfunded costs and losses we have experienced so far this financial year as a result of the pandemic. By planning our budgets in two-year cycles, it does also mean that we anticipate that there should be no new savings proposals needed as part of our 2021/22 budget setting process in February.

“However, the outlook deteriorates dramatically in future years. We face a major financial crisis as a result of the ongoing costs and consequences of Covid, and compounded by the continued need for increased social care provision to growing numbers of vulnerable adults and children. We continue to emphasise to Government at every opportunity, the need for a fairer and more sustainable funding solution to our growing social care costs now and post-Covid - and I have met with Hampshire MPs on several occasions to press this vital point.

“Since the start of the pandemic, we have received some welcome support from Government. However, the latest sum of £8.8 million announced in October falls well short of what we were expecting and is a long way off from providing a remedy to the drastic situation faced not only in Hampshire, but also by local authorities up and down the country.

“Our Covid costs amount to around £210 million over the next three years, and we will continue to press the Government to fund the full financial consequences of the pandemic. In addition, the decision by Government to hold a single year Spending Review is also disappointing but understandable, and we now keenly await details of next year’s provisional finance settlement for local government in early December, which should give us an indication of the landscape ahead.”

View the reports to be considered at the meeting of the County Council's Cabinet on 24 November 2020.