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Cambridge City Council

Council works to get city back on its feet despite financial challenges

News release from 24/06/2020

AS CAMBRIDGE City Council works to support the recovery of the city after the impact of Covid-19, a report on council finances suggests the impact on the council could add up to losses of £10m in the current year.

Councillors will consider an outline recovery plan at their meeting on 6 July. A separate report outlines the impact on the city of the Covid-19 lockdown and the work the council has undertaken to support residents during the lock down period.

Key achievements during that period have included:

  • The payment of some 1400 business support grants totalling over £21m
  • Facilitation and funding for 14 ward-based community led clusters providing support for vulnerable residents
  • Keeping 140 homeless people safe by finding temporary accommodation in hotels and other appropriate places
  • Keeping core council services working throughout.

This report also recommends a recovery plan to get the city back on its feet. This will be developed with other agencies, businesses and the community, built around four themes:

  • Economic recovery of the city and support to business
  • Social recovery and supporting anti-poverty work
  • Environmental recovery, and
  • Getting council services back up and running.

In thinking about the city’s recovery, the council also needs to respond to the major financial impacts and costs of the epidemic on the council itself. The negative financial impacts on the council substantially exceed the funding allocation Government has provided to date.

A linked report to the same 6 July meeting estimates that the Covid-19 crisis could cost the council almost £10m overall in 2020/21. The government has so far only given the council £1.3m towards this and £148k in support for staff on furlough, with a further £230k estimated to be received for further furloughing periods. It is not known if any further funding will be provided and the report considers ways to bridge the gap. 

Proposals include cancelling or delaying capital projects, not going ahead with some previously approved spending proposals for 2020/21 budget and releasing earmarked reserves that are no longer needed for their original purpose.

This leaves about £2m to find to balance the budget for the current year. The report recommends use of council reserves to fund this if no new government funding is forthcoming but a further £1.5m in deferred capital costs will need to be funded next year.

Councillor Richard Robertson, Executive Councillor for Finance and Resources said: “The council has worked hard to manage the impacts of Covid-19 on the city and our residents. Sadly, the reality is it is costing us far more than the funding the government has made available so far.  

“We are reliant on many different types of income to fund our work, but that income has been hit hard by the lockdown.

“We have made sure that our priority services will be maintained. We remain committed to our work tackling poverty, on the environment and biodiversity of our city, and dealing with homelessness.

“It is important we support the city’s recovery and think about how we provide council services into the future in this new landscape. Changes to how we have provided services during the pandemic offer a real opportunity to retain new, better ways of working. 

“We need to ensure that the positive impacts of the lockdown experience are retained or developed. In particular, the new ways of working that our staff and residents have embraced; and the environmental and air quality improvements that life in lockdown has prompted.”