CHIEF EXECUTIVE'S WARNING AS CASH CRUNCH LOOMS FOR NORTH EAST LINCOLNSHIRE COUNCIL

Rob Walsh - addressing the recent council cabinet meeting via a video-conference facility

A GRIM warning on the likely impact of  the coronavirus pandemic on North East Lincolnshire Council's coffers has been sounded by the authority's chief executive, Rob Walsh.

"The financial implications  are likely to be significant and far reaching," he says. 

"A full review of our finances, priorities and medium-term plans will be required as part of the recovery process.

"We will need  to determine the extent of the risk, to prepare a full package of response  measures and to ensure future financial resilience and sustainability."

The council received an initial Whitehall grant of £5.2-million, to be utilised predominantly on additional social care costs associated with responding to the emergency but also to cover any other related costs. 

Further  funding for local government has been pledged, but details of these monies are not yet known.

In addition,  all councils have  received an allocation of funding designed to support business. 

NELC’s allocation was £35-million in business support grant, designed to provide grants of between £10,000 and £25,000 to eligible firms to cover costs associated with business interruption to enable them to pay bills and to manage cashflow. 

"Our response was swift," says the chief executive. "It enabled us to reach two-thirds of eligible businesses within the first four  weeks. 

"Our officers are working hard to ensure that remaining businesses are contacted and the remaining grant is paid out.

"Additional small business rate relief has also been made available, and we have successfully and swiftly re-issued business rate bills to each business eligible for the relief."

NELC has also received monies totalling £1.6-million to support those households who are in hardship. 

This was precious because, in the first three weeks after lockdown was implemented, the authority saw an "unprecedented"  67 per cent increase in  applications for council tax support.

Correspondingly, the Department of Work and Pensions saw an additional 100-per-day new applications for universal credit.

Council tax makes up around 80 per cent of NELC's revenue stream.

Estimates indicate that the cost to NELC of  lost taxation as a result of Covid-19 could be in the region of £9-million in 2020/21, and this will run over to future years in terms of collection and bad debts if the economy continues to slow or stall. 

The council also generates revenue  through other sources of fees, sales and charges such as car parking monies  and rent from the commercial estate. 

All of these income streams are at risk as a result of the emergency situation, and estimates set the loss  at some £5.7-million  in the current year.

Concludes Mr Walsh: "In total we currently estimate our loss of income to be circa £15.7-million presenting a significant risk to our business plan and financial resilience."

* Keep checking the Grimsby News for further updates from NELC's chief executive - for instance on his pride at the "collective spirit, creativity and commitment" of council staff, both those at the frontline and those working behind the scenes, including those at home.