Budget impact of Covid-19 on Highland Council
3rd June 2020
Councillors taking part in today's virtual Corporate Resources Committee were left in no doubt about the significant and serious impact COVID-19 continues to have on the budget of The Highland Council.
The scale and immediacy of financial challenges to be faced were laid out in a report that modelled two different potential scenarios - in the ‘mid case' scenario, a budget gap of £65.7m is projected, and in the most severe, a potential gap of £96.9m is projected.
At this time the level of risk the Council faces is greater than perhaps ever before. The risks cover those to our staff and their health and wellbeing, to the health, safety and wellbeing of our communities and risks to the provision of essential Council services.
Highland Council and its staff, partners and communities have all stepped up to provide a response to the immediate challenges posed, including providing support to the most vulnerable as well as providing care for key workers. At the same time the Council has been continuing to provide essential public services.
The details of the adverse wider impact COVID-19 is having on the Highland economy are yet to fully emerge but are expected to be substantial as businesses fold and jobs are lost. The long-term impacts of these factors will be felt by the Council, both in terms of reduced income generation and increasing demand for services over many years to come.
Chair of the Resources Committee, Councillor Alister Mackinnon said: "COVID-19 has impacted on all of our Communities. Many people finding themselves vulnerable and in need of financial assistance and advice. There has been interruption to education and exams, loss of jobs and businesses and, with people facing uncertain futures, issues of stress, anxiety and isolation.
"To respond, the Council has had to quickly adapt to provide new services, including the Humanitarian Assistance Centres, the Helpline, food projects, hardship and welfare projects, business grants, childcare for key workers and virtual education. All of this comes at a cost and we do not know how long these services will need to be provided.
"We need to be in a position to plan for the future but there are so many variables and future uncertainties that forecasting, and modelling is impossible to do with any accuracy. There is a great risk that whatever scenario we plan for may be significantly different from what actually transpires, with the Council potentially facing a financial deficit that significantly outweighs our reserves."
Cllr Mackinnon added: "We will all be working hard to mitigate the budgetary impact but the stark reality is that our income streams have drastically dropped and there is no doubt the challenges to balance our budget are huge."
Following discussions, the Committee agreed to make representations to Government to advise that the council may require significant further financial support or other intervention from Government in order to manage its budget in the 2020/21 financial year.
A Budget Recovery Group is to be established and will meet regularly, reporting to Committee.
A further report will be brought to the full Highland Council meeting on the 25th June outlining the Council's potential response to dealing with this financial impact.
Corporate Resources Committee agenda and papers can be seen HERE
The Highland Council is updating parents and carers of its position on early learning and childcare (ELC). In response to the COVID-19 pandemic, The Scottish Government removed the statutory requirement for Local Authorities to deliver 1140 hours of ELC from August.
Following on from the recent publication of Highland Council's Supporting Economic Recovery in Highland - A Guide for Businesses - the Council is announcing relaxation of some controls that will assist tourist accommodation providers have been impacted by the Covid-19 pandemic. In recognition of this where there are specific planning and licensing controls in relation to occupancy, for example: a restriction on the occupancy of any caravan for a continuous 12 month period; or where conditions restrict occupancy for specific periods of time, ...these will be relaxed by the Council up to and including April 2021.
The Caithness Committee met virtual today for the first time since the Covid-19 pandemic and it's agenda focused on the actions taken by the Council and the third sector to deal with the effects of Coronavirus in Caithness. The Executive Chief Officer for Education and Learning, Paul Senior, gave members an update on the plans and preparations underway to prepare for the return of pupils and staff to Caithness schools in August.
Margaret Davidson, the Leader of the Highland Council has given her strong support to the efforts of the Scottish Government to obtain greater fiscal flexibility from the UK Government. The Scottish Government have sought flexibility to offset capital underspend against resource expenditure, more flexibility over resource borrowing and greater flexibility over the use of the reserve for capital.
The Highland Council is planning to re-open play areas across the region throughout summer. Advice was provided by the Scottish Government on 28 June as to the safety measures that should be applied.
The Highland Council was one of the first local authorities in Scotland recognised to develop a Schools Digital Learning Hub, which provides a resource for staff, parents and pupils to support home learning. Prior to Covid-19, we had an estate of 27,000 Chromebooks that were already a part of our ICT in Learning Strategy.
Earlier today (Wednesday 1 July 2020) members of The Highland Council's Economy and Infrastructure Committee had the opportunity to discuss (by video conference) progress made with the Corran Ferry Project which is reviewing the options for securing a replacement ferry and considering the way forward for the future operation and management of the service. The Corran ferry service has reached a critical point and strategic decisions need to be made.
As Scotland prepares for the easing of lockdown and the re-opening of the tourism and hospitality sector, The Highland Council's Environmental Health are advising holiday accommodation providers to make sure their private water supplies are safe to drink. A large number of self-catering and tourist accommodation in the Highlands are served by private water supplies and with these being closed during the lockdown period, the water supply system may not have been maintained and could create a risk to the quality and safety of the drinking water.
Lesley, who previously worked for Hackney Local Authority in London, expressed how much she has enjoyed working for the Council. Lelsey started with highland council on 13 August 2019.
Following Scottish Government guidance on returning to construction sites across Scotland, works will be restarting on the EES:ABS scheme across the Highlands. In line with the guidance, contractors will be undertaking phased restarts and adhering to social distancing to allow workers to return to construction sites gradually while using measures such as hand hygiene.