Coronavirus: St Helens Council to develop emergency budget

The council approved its 2020/21 budget in March, but this is now in tatters as the authority stares down a £25 million funding black hole.

A recent report on the authority’s response to the pandemic said an emergency budget will need to be drawn up in the autumn, as it moves into the second phase of its response to the crisis.

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The report said that, two months since the start of the outbreak, the council is still “very much in response mode”.

But it is now preparing to move into the next phase, the “reset and recovery phase”, which will build off the ‘One Council’ modernisation work.

Cllr David Baines, leader of St Helens Council, said: “From the start of the COVID pandemic and throughout lockdown, St Helens Borough Council has done all it can to support residents, businesses, charities and organisations right across the borough.

“We’re continuing to prioritise the delivery of essential services, but we are now able to also start thinking about our recovery.

“Before COVID hit, as a council we were focused on modernisation and transformation of the way we work.

“Not just through the One Council programme, but also importantly through getting in new blood at the top of the organisation with a new chief executive, assistant chief executive, executive director of place services and other appointments with the aim of changing our working culture.

“That’s why we’re not thinking of this just as a recovery process, but a reset and recovery process – we don’t want to go back to the old ways of doing things.

“We want to be efficient and modern and deliver the best possible services we can for residents.”

St Helens Council leader David Baines

Rob Huntington, the council’s new assistant chief executive, is leading on the authority’s reset and recovery plans.

Speaking at cabinet last month, he said there needs to be a “key conversation” around the council’s financial resilience and budget, with some services expected to see a surge in demand post-COVID.

In order to do that, he said, the council has established a COVID-19 reset and recovery coordination group,

The group will provide strategic officer leadership and will develop a reset, recovery and remobilisation roadmap, as it looks to establish a ‘new normal’.

“The key for us in St Helens is this is about reset,” Mr Huntington said.

“We’re not recovering or aiming to recover back to how it used to be.

“We are aiming to reset how we do things.”

The biggest concern right now is the huge funding gap the council is facing, due to the massive response on the ground to the pandemic.

For St Helens, the forecast expenditure pressures and loss of income over six months totals £37 million.

The council expects to lose £25 million through business failure and loss in business rates income as the economy shrinks, and the impact of coronavirus on the public and it ability to pay council tax.

Approximately £12 million relates to additional expenditure pressures, which include a forecast for some of the previously agreed 2021/21 budget savings the council says are in danger of not being delivered.

Since the start of the outbreak, the council has received £11.36 million in emergency funding from the government.

Therefore, the resulting funding gap, based on the six-month period used in the modelling exercise, is circa £25 million.

The council recently outlined the bleak financial picture in a letter to communities secretary Robert Jenrick.

The letter, which was signed by all of the political group leaders and the borough’s two Labour MPs, warned that the council would need to make “unprecedented and unacceptable cuts” if the government did not step in.

“The financial uncertainty we face is our biggest concern, and the leaders of all St Helens political groups agree,” Cllr Baines said.

“A potential £25 million black hole in our budget due to the fight against COVID must be covered by government and if it’s not then the services we provide and the keyworkers who deliver them face a very difficult future.

“We’ll be holding an emergency budget in the autumn and we all hope we’ll be in a more certain financial position by then.

“I’m extremely confident that with fair funding from government our council is in a very strong position to deliver better services, as well as delivering the regeneration of our town centres and districts that residents want, thanks to our deal with English Cities Fund.

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“We’ve now got the right senior officers in place, a strong cabinet giving strong leadership, and we’re ready to help our borough fulfil its potential. But we need the funding to do it.

“The fight against COVID isn’t over and won’t be totally won for some time yet, but we are doing all we can to get ready for a bright and prosperous future.”