Coronavirus: Covid-19 could cost Hampshire County Council £210m over next three years

The council’s cabinet is due to examine the latest coronavirus financial forecasts at a meeting on September 29 to review the unplanned costs due to the outbreak and lost income from areas including school meals, country parks and registration services.

The latest prediction put these extra costs and losses at around £160m this financial year with around £83m of that unfunded and the council has said it will need at least £52m from the government to be ‘financially viable in the future’.

Leader of Hampshire County Council, Councillor Keith Mans said: ‘The job of forecasting the financial impact of coronavirus is an immensely difficult task, not least because of the uncertainty caused from such a fast-moving, evolving pandemic.

‘Our exposure to Covid-19 is currently expected to cost us in the region of £83m this year. Fortunately, Hampshire was in a strong financial position before coronavirus hit, thanks to our strong track record of careful and consistent budget planning alongside the prudent use of our reserves. As such, we have put plans in place so we can weather the storm this year, but a council smaller than Hampshire might not have been able to cope with such challenges.’

Overall costs and losses could rise to over £210m over the next three years and a further £80m of savings will be needed in the budget by April 2023 to meet rising demand in services such as social care for vulnerable children and adults.

Cllr Mans added: ‘We have had some additional, welcome funding from government in the form of grant and reimbursement of lost income, to support local authorities’ response to the crisis, and together with some additional savings secured across our departments, the financial liability of coronavirus for this year is slightly less than we predicted earlier this summer.

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‘However, moving into the medium term, the situation worsens as we also take stock of growing demand in adult social care which we expect to increase further as a result of the pandemic, further lost income and council tax revenue, and the costs of responding to any subsequent coronavirus outbreaks. It means that our total unfunded costs and losses rise to around £210 million over the next three years – with the need for million from government in order to remain financially viable in the future.

‘We have remained steadfast in our representations to Government on the severity of this unprecedented situation and continue to stress the need for a sustainable funding solution to help us through the current financial crisis we face from coronavirus, and into the future – including opportunities that allow local authorities greater freedoms to charge for some services, and flexibility around setting council tax.’

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