Stevenage Borough Council agrees emergency budget as coronavirus losses mount

PUBLISHED: 16:43 12 June 2020 | UPDATED: 16:44 12 June 2020

A 'coronavirus recovery plan' has been agreed by the borough council. Picture: Danny Loo

A 'coronavirus recovery plan' has been agreed by the borough council. Picture: Danny Loo

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An emergency budget has been set out by Stevenage Borough Council, as it continues to grapple with huge losses brought on by the COVID-19 pandemic.

In May, it was reported that the council was considering the possibility of issuing a Section 114, which would be an admission of effective bankruptcy, banning the council from any new spending.

To alleviate this risk, the council has set out an emergency budget centred around nine urgent cost-saving measures, agreed by councillors at a meeting of the executive on Wednesday, June 10.

It has been recommended that the budget will be in force until the end of September, when the council will likely meet again to discuss its financial position.

MORE: Stevenge Borough Council facing bankruptcy amid coronavirus losses

The emergency measures include the repurposing of money earmarked for the Stevenage regeneration, and postponing expenditure on other projects such as town CCTV, and the hard standings programme.

The holding of vacant posts has also been agreed, which could save as much as £152,000 – but this will mean the council will not be recruiting to fill its vacancies.

Leader Sharon Taylor said she is proud that the council has “found a way through for the time being,” but stressed that the “almighty finanical shock” won’t be absorbed quickly.

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Cllr Taylor said: “Some councils haven’t got to the stage of emergency budgets just yet, but we needed to do this, because of previous cuts to our grant funding from central government.

“The danger was that we would slip into a Section 114 notice, which would have meant an even more difficult time for all of us.

MORE: We will do everything we can to protect jobs and services – Sharon Taylor

“We did have some reserves, but this didn’t leave us in a position to fill such a big hole without more significant work.”

The council is facing the possibility of £6 million in lost income by the end of the year – and only £917,000 has been received from central government, despite earlier promises that Westminster would “do what it takes”.

Deputy council leader Joan Lloyd added: “Members need to realise just how serious this is. I’ve been on the council for over 45 years, and I have never seen anything like this before.

“Bridging the gap between the funding and the losses was never going to be easy, for any council. Particularly with the cuts we’ve seen over the last decade.”

The emergency budget recognises that the actual impact of coronavirus will not be known for a number of months, because it is not currently clear whether deferred rent or other charges will become uncollectable.

It does note, however, that the financial impacts are likely to be felt far beyond March 2021.


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