Borders council £1.4m short as it struggles to deal with cost of coronavirus

The local authority is facing projected pressures of £20.4m for this financial year caused by the outbreak, but its resources, including emergency coronavirus funding from the Scottish Government, total just £19m, leaving it nearly £1.4m short.

At a meeting of the council’s executive committee yesterday, September 15, officers warned councillors they will need to dip into the authority’s reserves to meet any budget shortfall at the end of the year. 

That reserve fund, currently sitting at £6.3m, will need to be topped up next year, piling further pressure on the council’s future finances. 

A report presented to councillors at the executive meeting reads: “In order to support the council’s response to the Covid-19 pandemic, funding has been made available by the Scottish Government. 

“The level of support provided has not, however, been sufficient to fund the full financial impact of Covid-19, including the significant impact on the level of income which funds local services. 

“Additional Scottish Government funding in the form of grant has addressed 33% of the total pressure identified, with the welcome easing of restrictions in the use of specific grants for children and young people taking this up to 50%.

“The remainder of funding has required to be found from within existing council budgets and reserve balances.”

Aside from the pressures exerted on the council by the coronavirus pandemic, the council also has to find £12m worth of savings this year.

To date, it has made £5.2m worth of permanent savings, with £3.2m in savings set to be achieved and £3.6m more achieved by alternative, temporary arrangements.

The report continues: “The current shortfall of £1.393m, plus any further impacts, beyond the estimated shortfall which are not yet identified, will require further funding to be identified in order for the council to successfully manage the financial impacts of Covid-19 by March 31, 2021.

“Even if a second wave does not transpire, it is possible that further measures may have to be taken to address risks around Covid-19 and it is possible the full costs of responding to Covid-19 are not yet evident.”

Mid Berwickshire councillor Mark Rowley, the authority’s executive member for finance, said: “We’ve been through an incredibly turbulent time in recent months.

“The report reflects that the council is effectively a business, and, like every other business, it has had incredible shocks during recent months. 

“I want to congratulate the work of officers, particularly on the savings. When we were all working helter-skelter from kitchen tables and back bedrooms, to have achieved this level of permanent savings is a matter of real congratulation.

“Behind that figure is an awful lot of day-to-day work and thought. 

“We’ve lost £1m in planning income. These are really significant sums that are going to cause us real trouble. 

“Without being too party-political, I’m disappointed that the right amount of resources hasn’t come down from the Scottish Government.

“We have had stream after stream of additional funding, but that has literally gone straight out of the door with incredible speed.

“It’s for the leader and myself to make the political case, but it is the officers on the ground who deliver on government priorities on a day-to-day basis, and we need the resources to be able to do that.

“We are very early in this crisis. It’s going to go on for a very long time. In the course of this morning, I’ve had two emails from businesses which are struggling, and this could go on for years.”