Finances ‘may get worse before they get better’ at South Northamptonshire Council

Councillor Peter Rawlinson, the cabinet member for finance, also warned that things were potentially going to reach a ‘perilous’ state with increasing cases of COVID-19 inevitably having an impact on the authority’s finances.

The latest finance report, as of the end of June, showed the council forecasting a deficit of £642,000, an increase of £26,000 over the previous period. The main impact has been a loss of income and leisure costs, with the continued closure of leisure centres in the South Northamptonshire district costing the council £223,000. There were also additional staff costs of £41,000 for rubbish collections during the pandemic.

Speaking at a cabinet meeting on September 14, Councillor Rawlinson said: “The first-quarter report as you would expect shows a situation significantly affected by COVID. The total additional cost to the council as a result of the pandemic is over £2.3 million, although this is partially offset by government grant funding of £1.2 million. Taking out the exceptional COVID costs we would have been forecasting an actual underspend of £73,000.”

He also warned that the growing number of infection rates could lead to further economic hits for the council as recovery plans are paused or potentially scrapped altogether.

He said: “We are in potentially a perilous state. We see the rate of COVID cases rising as they did at the start of the year, with the R rate increasing. Whilst thankfully we’ve only seen a small number of cases in South Northamptonshire, we should remember we do not exist in isolation and have seen worrying case increases in Northampton and Oxford. It’s not unreasonable to consider a new total lockdown may come, and with the associated economic impact things may well get worse before they get better.

“We are also forced to anticipate with much trepidation the impact of Brexit in less than four months’ time.

“It’s important we exercise extreme prudence with our finances going forward, not only to maintain our services to residents but also so that we pass our assets to the unitary council in the best possible state.”