Thanet council faces income loss of £5.5million due to Covid crisis impact

Council leader Rick Everitt

Thanet council is planning a report to Cabinet members next month to assess the financial impact of COVID-19 on the 2020-21 budget as it faces £5.5million in lost income.

The lockdown from March 23, combined with many people living on 80% wages through furlough and businesses attempting to exist on government grants and adapted business schemes, means the council has suffered financial losses in areas from parking fees to council tax and business rates.

Although government emergency funding has so far amounted to £1.5 million it is against total General Fund losses currently estimated at £5.5 million.

This is made up of £3 million from fees and charges -inclusive of £1 million is car parking fees – £1.5 million from Council Tax and Business Rates and £1 million of additional estimated expenditure.

Resources have also been used for the council’s community response to the crisis with a helpline and coordinating food deliveries to vulnerable people in partnership with established groups such as the Salvation Army, Global Generation Church, Kent Coast Volunteering, Age UK and town and parish councils to make sure people in need are connected to those best able to help them either due to proximity or specialist skills.

‘Significant effect’

Council leader Rick Everitt says the crisis has had a ‘significant’ effect on funds and, like other councils, TDC is lobbying the government for more financial aid.

He said: “The council has obviously prioritised the needs of the community during the response phase of the Covid-19 emergency. This has had a significant effect on the budget agreed in February, just as it will have done in other district councils across Kent and beyond. The loss of revenue during the lockdown is particularly significant.

“It’s too soon to be very precise about the extent of the impact, but we can say that the sums we have received from the government to date won’t cover it. In common with every other council, we are lobbying for more and we remain hopeful we will get more in due course.

“In the meantime. there is no risk of the council running out of money, as we do have reserves which we can call upon, although these will need to be replenished and there may be an impact on activities that would otherwise have been funded from those reserves.

“It is a difficult situation, but we will be looking to safeguard frontline services to minimise any impact on residents as the recovery takes shape.”

The estimated loss for 2020-21 is based on an assumption that income will recover from late summer.

Thanet District Council has received other funding for initiatives such as funding for rough sleeping and reopening the high streets. It has also received funding for Business Rates reliefs, business grants, discretionary grants and Council Tax hardship, all of which are passed through the council’s accounts – if the funding isn’t used for the purposes it is granted, it is returned to Government.

‘Financial pressures ahead’

Local Government Association chairman Cllr James Jamieson said: “Local government continues to lead the way during the emergency response to this crisis, but they are being stretched to the maximum.

“Vital emergency funding from government has helped meet extra cost pressures and lost income in the past three months.

“Concerns remain about the ongoing financial pressures ahead. Councils will need further funding and financial flexibilities in the weeks and months ahead to meet ongoing COVID-19 pressures and to keep services running normally.

“Certainty around this is desperately needed so councils can balance their budgets this year and take vital decisions about how to pay for vital local services next year.

“Councils not only need to be fully funded to help our communities beat this virus now but also to help support the nation as we tackle the unprecedented social and economic task ahead and move into the next phase.”

13 Comments

  1. Queue the people moaning about the amount of money people pay TDC in Council tax when in fact it is about £3 a week for the average household, it would cost you more in time and money if you just had to get rid of your own rubbish each week !!

  2. Where I live we pay the highest band and I think it’s cheap. We should all pay an extra £5/10 per month at least.
    My daughter in Sweden pays the equivalent of £600 per month, for a 3 bedroom house and that is the low compared to others.

  3. Hopefully rick will reconsider giving national rail a gift of £2 million to create a white elephant in the form of Thanet parkway railway station near his home in cliffsend

  4. Save £2 million by not giving a present of £2 million to national rail , to build a white elephant named thanet parkway station in cliffs end near where you live rick

    • Hear, Hear Barry! Why is public money being given to provide an unwanted station for privatised railways, they should pay for it as would any normal business!

  5. Stop wasting money on vanity projects like ticketless parking schemes which cost over £80k to set up in Trinity Square and made no difference whatsoever in additional income compared to before.

  6. So much is wasted on non essential projects when that money could be used to plug the hole he talks about. Get your priorities right!

  7. They could save the 3 Million they want to replace their offices at Cecil Sq. The offices have been empty since March, when they all started to work from home. This shows an office of this size is not needed. Maybe just a small office at Pysons road is needed where the Council own empty units. If the office staff can work from home now without impacting services for 3 months Let it continue.

    • They are talking about revenue spend which is totally different to long term capital spend on buildings and that is also likely to be majorly reviewed given the current situation, it won’t help the current situation…..

  8. Not that long ago, the government was announcing that they were prepared to spend “Whatever it takes” to defeat Covid19 and urging local councils to join them in immediate efforts, regardless of cost.
    In fact “Whatever it takes” became one of those easy-to remember slogans they are so fond of, like “Get Brexit done” or “take back control”, probably dreamed up by our Prime Minister, Dominic Cummings.

    But, within just a few weeks, “Whatever it takes” has been junked and local councils are finding that the government are deciding to offload the costs onto local Community-charge payers. That way, we can grumble about the local Council and scrape around trying to think of some local expenditure that can be dropped. Closing the public toilets? How about that? Either way, the government gets let off the hook despite urging the councils to take on the costs of supporting their populations during the Covid crisis. Now they are walking away and washing their hands(as they should be doing for at least two minutes!)
    They are doing the same over ending the Lockdown. Now they are reeling off all the shops and services that can be opened in the next few weeks but we have to “use our common sense ” (four words, not three, sorry!) so that, when the rate of infection rises , they can blame the irresponsible public, not themselves.
    And , when the cost of that Brexit getting “done” starts to become obvious, they can blame the virus! It’s never their fault, it seems.

  9. 1. Don’t move the Council offices to a new location. This is a vanity project.
    2. Don’t waste our money and yours on the white elephant of the station nobody needs at Cliffsend.
    3. Start innovating and thinking about revenue generation instead of making us just pay more through parking charges and fines.
    4. Stop sieving money on Ramsgate Port and Ramsgate Harbour through shocking mismanagement.

  10. like many other organisations and individuals who are experiencing financial loss during the pandemic.

    We are dealing with.

    thanet council just have to deal with the situation,maybe reduction of white collar workers in conjunction with the remaining workers being more productive.

    The gravy train express lives on !

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