Council's underspend earmarked for Covid-19 recovery in Barnsley

A report to council cabinet members says the authority's general fund has an £6m operational underspend for council services and a £900,000 underspend on corporate budgets.

Cabinet members are recommended to approve the use of £1.9m of it to support the Covid-19 recovery strategy, with the remaining £5m to increase the council’s general fund minimum working balance from £15m to £20m, to offer further protection against the impact of Covid-19.

They are also recommended to approve earmarking £600,000 of the authority’s £2.4m housing revenue account underspend to support the Covid-19 recovery.

An accounts summary document outlines the underspend and forecasts council tax collections will fall by 2.8 per cent in 2020-21, at a cost of £3.3m.

It states: “This places substantial pressure on the 2020-21 budgetary position and as such will be closely monitored moving forwards.”

It states the council's finance director will seek permission from cabinet members to write off £2.1m in debt, which has become ‘uneconomical to pursue’.

The debt includes £1.26m in council tax, £286,000 in business rates and £187,000 in housing benefit overpayments.

The summary says: “Following an initial review, the estimated financial impact on the council’s 2020-21 budget is a shortfall of around £40m.

“While Central Government have provided specific Covid-19 funding totalling £15m, this still leaves a potential gap of £25m.

“As a result of this anticipated financial impact, the senior management team is formulating a financial recovery strategy to safeguard the council’s ongoing financial standing and sustainability.”

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