Agenda item

The Director of Finance submits a report summarising the initial financial impacts of the Coronavirus pandemic on the Council’s revenue budget.  The Committee is recommended to note the report and make comments to the Director of Finance and City Mayor as wished and to support the City Mayor’s stance that the Council expects Government to meet the full costs incurred.

The Director of Finance introduced the report outlining the financial impact of the Coronavirus pandemic on the 2020/21 budget.

The City Mayor commented that there were large amounts of uncertainty during this time and although the Government had provided some support, the Council were still uncertain of the level of additional service required during the current situation.

Members were invited to ask questions which included the following comments in response:

• In terms of the Council’s position on allocating funding the Constitution allowed the Director of Finance to increase the Council’s spending above the approved budget during an emergency. The Director of Finance advised she would bring forward a proposal to increase the Council’s approved budget funded by the government grant to the Overview Select Committee in due course.

• Regarding the Council’s position on borrowing additional money, that was relatively cheap to do, however it was not the ideal step to take and other councils that had borrowed money recently were in difficult positions and risked bankruptcy. Borrowing money would only be considered for capital investment if there were no other alternatives.

• In the event of a potential second peak of Covid-19 and the impact of that if the Council were to go into another lockdown with loss of income then the Government would have to provide significant funding to support local authorities as it had done now.

• In relation to the current Capital Programme and developments such as Jewry Wall Museum, the City Mayor informed Members that there would have to be a review on the Capital Programme, but it was not anticipated that would be a fundamental review. Time frames would require adjusting to complete projects and carry out the activities set out in the manifesto on which Members were elected.

• The Leicestershire County Council Pension Fund Administrators were preparing the annual accounts and the pension fund would in time be evaluated to determine what impact the pandemic would have on the Council’s pension fund. Up to this financial year there had been an improvement in the performance of the fund to the benefit of the city so it was anticipated that the Council may have lost some of that benefit if the pension fund was valued down, although there were no significant impacts anticipated.  

• In relation to further measures for small businesses, contact had been made through various means with hard to reach businesses and their owners. It was noted that the Government had not indicated an end date to the business support grant, and it was hoped that Ward Councillors could use their networks to help make contact as lockdown began to ease.

• The service was working alongside the Leicester and Leicestershire Enterprise Partnership to predict what kind of economic impact there could be on the city if the two major universities moved lectures online. Although some universities had announced online learning it was suggested that it would be impractical for De Montfort University (DMU) to do this, as it offered many practical courses to the students. The City Mayor commented that he was aware that DMU would be resuming on 5 October 2020 and they were determined to have face to face lectures as much as possible.

The City Mayor recognised the work of the faith groups in the city who had come together at short notice, helping contribute to the running of services.

It was noted that the Head of the City Mayors Team had been the point of contact for many of these faith groups and assurances were given to Members that there would be continuing opportunity in the future to thank all those involved.

Agreed:

1)    That the contents of the report be noted.

2)    That the Overview Select Committee supports the City Mayor’s stance that the Council expects Government to meet the full additional costs incurred during the emergency.