Financial pressures continue to mount on Barnet Council
Years of local government funding cuts dictated from Whitehall have left Barnet Council ill-equipped to deal with the financial consequences of the Covid-19 pandemic.
The Council's Financial Performance and Contracts Committee met last month for the first time since January, and featured sobering discussions of the council's depleted reserves, which may yet fall below the permitted floor. A later investigation by BBC News found that Barnet is one of at least five English councils warning they may meet the criteria to, in effect, declare themselves bankrupt.
The Council's Chief Financial Officer (known as the Section 151 Officer in local government parlance) shared initial modelling which suggests in 2020/21 Barnet will face a deficit of £26m, on a revenue budget of around £300m. This deficit will arise from £24m anticipated cost pressures (e.g. additional adult social care costs), and £28m revenue pressures (for example, less income from business rates and leisure services, as well as £11m foregone income from parking charges).
That leaves an in-year funding gap of £26m, which the council intends to fund from its reserves. At the start of April 2019 non-earmarked reserves totalled £50m; they now hover just below £40m. Factor in the £26m hit, and things start to look untenable.
You can find our full coverage of the Financial Performance and Contracts Committee here, on Twitter.
Barnet Liberal Democrats are following this story closely. We will not let Barnet brush its financial woes under the carpet.