The Covid-shaped black hole in the Isle of Wight Council’s finances has reduced, but ‘difficult’ work has already started preparing the budget for next year.
The council’s Cabinet was told the £10 million funding gap is now down to £8 million thanks work done to repair the financial damage.
Deficit reduction strategy
Earlier this year, the full council approved a deficit reduction strategy which paused renovation projects to council offices, additions to the fire fleet, and took money from the council’s reserves – creating nearly £11.5 million to cover the costs.
With work underway to retrieve all the money and further funds coming from central government, including a scheme that will see up to 75p of every £1 of lost income returned to the council, the gap is slowly closing.
Work has begun on 2021/22 budget
If the budget is not balanced at the end of the financial year, in March, the money has to be found in the council’s already stretched budget for 2021/22.
Despite the current issues, work has started on the budget for next year where £3.5 million will need to be put away as part of the council’s saving targets — hoping to set aside £10.5 million in its next three budgets.
Hutchinson: Bolstering our reserves has been enormously useful
Cllr Stuart Hutchinson, cabinet member for strategic finance and the covid-19 recovery, said:
“I don’t need to remind everyone how challenging that will be.
“Fortunately, over the last four budgets we have done, we have been able to bolster our reserves and that has been enormously useful carrying us through this period.
“That is not to underestimate how difficult will be — we still need government support but we won’t know what that will be.”
Cllr Hutchinson said no major announcements about the budget would be made before Christmas.
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