Exeter City Council announced an anticipated £1.584m budget shortfall for April at Tuesday’s full council meeting.
The meeting, which was held online, heard that revenues from car parking had fallen precipitously, down from a budgeted £170,000 to £1,000 a week.
It was also told that council-owned visitor attractions and entertainment venues were closed and adverse effects on collection of council tax, business rates, commercial rates and other debts were expected.
Council leader Phil Bialyk said: “The restrictions put in place to protect the public and NHS have had a significant impact on the council’s income.
“The return sent to government last week estimated a total loss income of £315,000 for March and £1.584m for April.
“There is a risk of losing an additional £681,000 in council tax and business rates in bad debts for April alone based on current payments compared to last year.”
Exeter High Street under COVID-19 coronavirus lockdown
The council’s chief executive, Karime Hassan, had previously informed the council’s Executive that the £4.3 million held in the city’s general fund reserves at the end of 2019-20 would be depleted by the loss of income unless the government stepped in.
He said: “Cash flow is an issue for us and we hope the government will do something quickly.”
However Devon councils received only limited shares of the £1.6 billion emergency funding for local government announced on 19 March and the additional £1.6 billion announced on 18 April has not yet been allocated.
Council leader Phil Bialyk said that the government had so far given the city £23,400 to support rough sleepers and £72,737 in general grants, but added: “The additional cost of emergency accommodation for rough sleepers has amounted to £193,000.
“In total, it is estimated the council has spent an extra £238,000 in March and April above the amount provided by central government.
“The extra £1.6 billion nationally is welcome but we don’t know how it will be allocated to councils. We are regarded as the last mile to deliver services but we cannot deliver if we are not funded.”
Cathedral and Quay car park
The council’s Executive deferred £6.357 million of capital spending at its meeting on 8 April in response to the loss of income.
This included £3.9 million on repairs and refurbishment at the Cathedral and Quay car park, £2 million for an increase in Riverside leisure centre refurbishment costs and the lifecycle replacement cost of its roof and £250,000 to replace a roof at Exeter Corn Exchange.
Council leader Phil Bialyk said the council has been told it will only receive additional funding for COVID-19, but that the loss of revenue in other areas meant the council’s financial viability could be in doubt.
“We were already on a tight budget for this year so we face a big financial challenge. The lost income, lost commercial rents, loss of business rates and everything else: we will not get any of that back again.”
Riverside leisure centre refurbishment works
Robert Jenrick, Secretary of State for Housing, Communities and Local Government, called council workers the “unsung heroes” of the coronavirus response and said would they have the resources they need.
He said: “My priority is to make sure they are supported so they can continue to support their communities through this challenging time.
“They are in the front line of the national effort to keep the public safe and deliver the services people need.
“This new funding will support them through immediate pressures they are facing to respond to coronavirus and protect vital services.”
