The County’s external auditors EY have not been able to sign off HCC’s 2019/20 accounts by the end of November, because of two concerns. One relates to the Dedicated Schools Grant (DSG) deficit which requires action by the MHCLG and the other relates to a “Going Concern” issue. The DSG deficit is a technical issue and should be resolved quite soon, however the “Going Concern” is more serious and therefore only the draft annual accounts can be published until a resolution is found. The Council believes that it does have sufficient funds through to March 2022 at least.
To make matters worse for local authorities, the recent Comprehensive Spending Review by the Chancellor of the Exchequer was for only one year instead of the normal three, making it very difficult for councils to plan for their Medium-Term Budget Strategy.
Nevertheless, Government has not fulfilled its pledge to cover the “Whatever it takes” pledge it made with respect to COVID expenditure leave the Council £34m out of pocket currently with an expected deficit of £210m by 2023. This will force cuts of £80m.