Sunderland City Council predicts £10million shortfall by end of year

City leaders are expecting to find themselves short by more than £10million by the end of the year.

Wednesday, 15th July 2020, 6:00 am
Sunderland Civic Centre

The coronavirus pandemic and subsequent lockdown hit almost every aspect of Sunderland’s spending plans for 2020/21.

And bosses have warned the effects could continue well into next year and even beyond if ministers don’t stump up the cash needed to close spending gaps.

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“A £10.552million overspend is forecast and this is fundamentally due to the additional costs and lost income arising from our response to the crisis,” said Coun Paul Stewart, cabinet secretary at Sunderland City Council.

“This pressure has been calculated after the additional COVID-19 funding we have received to date.”

He added: “This is not just an issue for this financial year.”

Coun Stewart was speaking at a meeting of Sunderland City Council’s (SCC) ruling cabinet, which was held by videolink and broadcast via YouTube.

Since the start of lockdown, Wearside has been allocated funds from government COVID support schemes worth more than £18 million, which has still not been enough to cover the full hit to the city council’s finances caused by the pandemic.

On July 2 the government announced £500million of further support, but is yet to confirm how this will be distributed.

Details are also still yet to be unveiled of a scheme to help councils replace missed income from ‘sales, fees and charges’.

City investment plans worth £175million this year are still expected to go ahead, helped by ‘historically low interest rates’ which are expected to continue for the foreseeable future.

Graeme Miller, the leader of SCC, claimed the government had spent recent months and weeks ‘disgracefully’ trying to distance itself from previous promises to stand ‘shoulder to shoulder’ with local authorities.

He said: “We have an unprecedented situation and not because of any action this council has taken, other than to do what the government insisted local authorities do, regarding the public health crisis.

“We demand the government live up to its pledge.

“This is money the government must supply to all local authorities in England, we have shouldered the load to keep Sunderland as safe as we could.”

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