Video explains impact of Covid-19 on the Council budget
Updated financial modelling has been presented to a meeting of Highland Council and Members have noted the revised budget gap.
Due to the unprecedented nature of the current financial climate any scenario, modelled requires significant assumptions to be made with no historic basis on which to found it. This in turn brings significant forecasting risk.
Previous scenarios were identified by the Council during the lockdown period, with no definitive indication of how long this would continue and whether or not future lockdowns would occur. The updated scenario identified in today’s paper is based on a continued positive progression out of lockdown.
A gap of £47.7m is now forecast, before additional government funding is applied. The application of confirmed government funding reduces the gap to £35.7m.
Budget Leader Cllr Alister Mackinnon said: “At this stage, it still remains incredibly difficult to fully assess the impact of Covid 19 on the Council’s budget, and we will continue to update our assessment as the ongoing situation develops and further information is received.
“Whilst the figures have improved from those reported previously, any adverse setbacks in the route map out of lockdown will likely widen the anticipated budget gap. We intend to reduce the potential financial impact further by actions to control Covid response spend, by reprioritising existing resources, controlling ongoing expenditure and reassessment of cost pressures. It is important to remember however that we remain in very uncertain times.”
A video has been created to explain the impact of Covid-19 on the budget and how the gap has been estimated.
Further updates will be presented to the next Council meetings.