Skip to main content
Dudley Council
Dudley Skyline

Coronavirus puts pressure on council finances - report

Posted on:

There is a “high risk” Dudley Council will need to dip into savings to balance the books this year as a result of extra costs - including those incurred fighting the coronavirus.

A report set to go before the local authority’s ruling cabinet reveals finance bosses currently predict the cost of Covid-19 on the council coffers for the financial year 2020/21 to be £27.5 million.

But the figure has been reached with “significant uncertainty” and could end up being much higher, the report says.

The council has received a government grant of £19.1 million to offset increases in expenditure and reductions in income as a result of the pandemic.

But with anticipated increased spending and loss of income - including council tax and business rates - due to Covid-19 and other financial pressures, the report says it is likely the council will need to use some of its reserves to meet the black hole in the finances.

Such a reliance on reserves could become “unsustainable” in future years and “as early as next year”, the report says.

Councillor Steve Clark, cabinet member for finance, said:

As a council we have received over £140 million from the government to help people in the borough deal with the fall-out from the coronavirus pandemic.
That support has been very gratefully received – but over 85 per cent of that cash is ring fenced and is for specific purposes, such as business grants.
It is unclear at this stage whether the £19.1 million we received to offset our extra spending and reduced income as an authority will be enough to cover what we’ve had to pay out.
There is a very real risk that it won’t be, and that we will have to use reserves to cover the difference. That is always a last resort, and is unsustainable for anything other than a short period of time.
We will continue to monitor the financial situation against an ever-changing backdrop, and may need to identify additional savings from next year.

The report will be discussed at the next cabinet meeting on Monday July 6.

About the Author

Press Office


You are free to share, modify, and use images from the news release pages on for any purpose and without any restrictions under Public Domain Dedication - see our Copyright Statement.