Chelmsford City Council estimates an £8.6 million shortfall this year as a result of the coronavirus pandemic.
Total predicted losses and extra costs in fact come to £11 million. With a Government grant of £1.8 million plus £600,000 of Government contributions to the pay of furloughed staff, the estimated shortfall is still £8.6 million for the year.
The City Council provides essential services to Chelmsford residents, such as collecting waste and recycling, housing, helping people who are homeless, looking after green spaces, managing new development, keeping the community safe, cemeteries and crematoria, business support, taking care of the environment and much more.
These services cost over £60 million a year. Half of that is paid for by fees, charges and sales levied by the council, and all those have dropped dramatically in the last three months.
Car park charges, admissions to leisure centres, theatres and events, and hire of spaces like Hylands Park all help pay for these services. During the pandemic, these income-generating venues are closed, which means that there is a significant budget shortfall.
Costs are increasing too. An extra £360,000 is being used to help people who are faced with homelessness. Agency staff have been hired to cover key workers who have not been able to work, at a cost of £90,000, and there have been other costs associated with enabling staff to work from home and getting important information out to vulnerable residents.
Councillor Stephen Robinson, Leader of Chelmsford City Council, said, "Like organisations all over the world, the City Council has a funding gap which is growing. The money we raise from fees at events and venue charges pays for services that residents need. Without it, we will struggle to fund essential public services. If the money is not there, we cannot pay for the places, equipment, food, staff costs and so on required to keep them running. The final outturn could be worse than currently estimated.
"Local government is the lifeblood of essential services for the community and many people take it for granted. Chelmsford City Council was previously in a strong position compared to some local authorities, but this pandemic has taken its toll and councils around the UK urgently need government support if we are to continue our work."
Officers are currently preparing a medium-term financial strategy report, which will be discussed by Councillors at a streamed public meeting in July.
The City Council has released a video explaining the situation. Watch it at https://youtu.be/SBkQmHuIxtE
Tuesday 9 June 2020