Council still faces financial challenges despite government funding announcement

Following last week's announcement by Government on additional emergency funding for local authorities, Wiltshire Council's latest projections show that this has significantly reduced the chances of issuing a section 114 notice, but there are still challenges ahead.

On 2 July, the government confirmed local authorities would receive an additional further £500m in a non-ring fenced grant to cover expenditure. The government also confirmed that it will introduce a new income loss scheme that will pay a percentage of all lost income from planned sales, fees and charges. This, together with the council's own mitigating financial planning, means council reserves are not expected to be exhausted.

Before the announcement, the council's projected overspend was at £36.73m. It is not yet known how much of the £500m Government funding and funding through the new income scheme Wiltshire Council will receive.

Despite the additional funding, there will still be financial challenges ahead and the council is taking steps now to manage this as carefully as possible. The council is putting controls on spending on such things as training and consultants and an external recruitment freeze is now in place, with exceptions only approved by senior officers.

The council has also recently realigned some of its working structures to reflect current resources and to help the county recover from the impact of COVID-19.  Last week the council formally reverted from two Chief Executive Officers to one Chief Executive and its number of cabinet members went down from nine to eight, and portfolio holders from 14 to 10.

Wiltshire Council has had reduced income due to services such as leisure and car parking halting temporarily, and has had to spend more money to protect the vulnerable, and ensure people have what they need to get through this unprecedented time.

Cllr Pauline Church, Cabinet Member for Finance and Procurement, said: "The additional funding from the government will certainly ease the pressure, but we are still facing significant challenges ahead and more funding will be required. Locally, we are leading on the recovery from COVID-19 so we are working hard to ensure we have the right resources in the right areas to help the county get back strongly on its feet.

"We await with interest to see how the government will allocate the additional funding and will continue to work closely with them to try to ensure the county gets what it needs."

A financial update will be provided at the council's next Cabinet meeting, taking place on 14 July. You can view the agenda and reports on our website (opens new window).