Almost another £1 million has been added to the Isle of Wight Council’s deficit in the wake of Covid-19.
In papers released yesterday (Wednesday), it was revealed the gap in the authority’s struggling finances has grown to £10.7 million, from £9.8 million in June.
Additional costs and lost income
In the three months since the last breakdown of finances, council documents show there has been an extra £800,000 of additional costs, £400,000 of income lost and £1.1 million of funding losses, such as council tax and business rates.
The Isle of Wight Council has now received £10.3 million in government support over three separate allocations — bringing the total £21 million deficit down to £10.7 million — but still leaves the council to find extra money in an already stretched budget.
Deficit recovery strategy
In February, the council had already committed to saving £4.5 million as part of its financial strategy for 2020/21 so, in July, a deficit recovery strategy was put in place to fill the void or risk service reductions and emergency spending controls.
£11.5 million was found in all corners to help bridge the budget gap — with money left over in case more Covid-19 costs occurred.
Money earmarked for short-term risks — in this instance, £3 million set aside to cover potential court costs following the legal battle over Christ The King College’s sixth form building — was taken to cover the deficit.
Projects put on hold
Refurbishments of Sandown Civic Centre and Ryde Help Centre have been put on hold, saving £875,000.
A further £50,000 has been found from flexible use of office accommodation while council staff work from home. (no problem.)
The proposed Nicholson Road, Ryde, development has been halted, although planning permission is still being sought, and the outlining of a business case for Camp Hill has been paused in an effort to save the council some money.
Some losses will be recoverable
The council will also be able to recover a portion of its lost income through a scheme the government has announced, although detailed estimates of how much have not yet been announced.
The extra £900,000 deficit which has occurred in the last three months is still able to be covered by the deficit reduction strategy – but only leaves £800,000 before the council has to find more money — unless the government’s income compensation scheme pays out soon.
This article is from the BBC’s LDRS (Local Democracy Reporter Service) scheme, which OnTheWight is taking part in. Some alterations and additions may be been made by OnTheWight. Ed
Image: P Schadlerunder CC BY 2.0
