Barking and Dagenham could have to make cuts of almost £40m following coronavirus
- Credit: Archant
The town hall could be forced to make cuts of almost £40million over the next four years, a report shows.
Barking and Dagenham Council calculates it would need to save £39.7m by 2024/25 to balance the books, according to a medium term financial plan approved by cabinet chiefs at a meeting on Tuesday, July 14.
Cllr Dominic Twomey, the local authority’s finance chief, said: “We’re in the most unprecedented and difficult times.
“I didn’t expect the start of this decade to be worse than the previous one. We had begun to get ourselves in a good position.
“A combination of Covid-19, but more importantly resulting from an incompetent and muddled Tory government, has resulted in a more difficult time than we could have predicted.”
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The Labour councillor warned of “choppy waters” ahead, but added the council’s approach provided confidence.
Cllr Twomey criticised the government for sending “confusing” messages over its financial support.
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He explained at the start of the pandemic ministers promised help “come what may”, but government was no longer going to do that by plugging council budget blackholes.
The pandemic’s cost to Barking and Dagenham amounts to £41.3m, the report shows.
Cllr Twomey said details remain unclear of a plan by government to cover 75p in every pound of losses councils incur from reduced sales, fees and charges.
But Westminster expects town halls to “bear the brunt” of the first five per cent of lost income, he added.
And “some pain” will be felt in the years ahead with government not writing off local authority debt – something it did for the NHS – or providing the “huge package” of support offered to business.
“We have worked tirelessly to protect our residents and continue to provide exemplary services in many areas.
“But this is going to be tough without a shadow of a doubt. I’m confident we will get through this,” he said.
He added that unlike some councils Barking and Dagenham is “nowhere near” the point where it would have to impose immediate spending curbs.
A number of risks are mentioned as having a possible impact on the medium term plan, including Brexit, Covid-19 and the fair funding review which the council expects will shift resources away from London.
The council has £17m in its emergency reserve pot.