Financial Pressures Build for Vale of Glamorgan Council as Coronavirus Takes a Hit

  Posted: 01.07.20 at 12:28 by The Editor

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The leader of the Vale of Glamorgan Council, Cllr Neil Moore, has made a statement on the financial implications of the coronavirus pandemic on their services and the authority on the whole.

He said: "The Vale of Glamorgan Council is currently helping to administer a range of financial support to help residents and businesses cope with the challenging situation created by Covid-19.

"Some of this will be reimbursed by Welsh Government, but it’s not yet known exactly to what degree and in the meantime, the Council must cover costs itself.

"It’s quite devastating in some respects, but we are luckier than other councils in that we still have some reserves and some balances. It’s ironic in some ways as when we were setting the budget for this financial year, some of our members wanted to use them and reduce the Council Tax levels. If we had done that, we would not have the buffer we have now.

"It’s fortuitous that at that time I resisted because I didn’t want to be in a position where we would not have finances available to respond to an emergency, like the flooding we saw in Rhondda Cynon Taff.

"I didn’t know that the Coronavirus was going to hit us, but clearly it is having an effect. For example, we’re not collecting business rates because we’ve given lots of businesses a payment holiday and we’ve also issued a considerable number of grants to businesses.

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"In total, we have paid out more than £24 million in grants to businesses, which we will get back from Welsh Government, but there’s no guarantee that all businesses will survive this.

"We’ve also granted some rent relief for businesses who operate in Council-owned premises for the first three months of this year, but who knows how long this pandemic will last.

"Whilst the Welsh Government has been able to provide some additional funding to local authorities, they have not got a bottomless pot of money either.

"We’re also paying out grants to charities and amateur sports clubs.

"Covid-19 is also having an effect on the Council Tax Relief Scheme. The Government currently provides money to help people on low incomes claim a discount. The level of funding was set prior to this pandemic and the call on this funding is already increasing. Again, this may not be sustainable and we may have to fund it ourselves.

"Applications for that fund have gone up immensely since the Covid-19 situation. The Welsh Local Government Association believe there could be a spending increase of around £11 million across Wales. For us, that would equate to around £400,000.

"Basically, at the moment, we can code spending against the pandemic and make claims to Welsh Government, as is every other Local Authority in Wales. But I emphasise, there’s no guarantee that it is going to go on forever.

"The virus has also seen internal costs increase in certain areas. We needed to upgrade our IT facilities and expenditure on waste and recycling is also rising.

"We’ve had to increase our investment in IT because a considerable number of staff are now working from home.

"Originally, we thought we were going to get all of that back, but now we’ve been told we’re only going to get 50 per cent. That’s an expense we didn’t anticipate and it’s an expense we will have to absorb.

"The other added expenditure is due to people being out of work or furloughed. We have seen increases in applications for Universal Credit and that’s going to have an impact on us in terms of the ability to collect Rents and Council Tax. Exactly what that impact will be is unclear.

“Despite that, we are continuing to run services, as far as possible and we have seen a massive increase in areas such as recycling and waste.

"The other area of increased spending is on Social Services, which normally spends around 25 per cent of our budget. That is going to go up dramatically because people are getting frailer and succumbing to Covid-19 and we are also supporting people in care homes and providing PPE for our staff and the care homes.

"Overall, the virus is having a massive impact on the Council and the Community. The exact extent of this impact is very difficult to estimate, but we will continue to support the community until it is defeated.

"However, I would make it clear that everyone has a responsibility in keeping themselves and others safe until this Pandemic is over. We do not know when that happens, but it certainly will not be in the short-term.

"My message is simply until then, take care of yourself, do not put others at risk and stop the increase of the R number in our community."

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