COUNCIL reserves are likely to be able to cover any funding gaps in this year's budget, but the impact of Covid 19 on finances is still "severe" - a meeting has been told.

At an online meeting of Bradford Council's Executive on Tuesday, members were discussing finances over the first three months of the financial year - which started in April.

The year has so far been dominated by the impact of Covid 19 and the lockdown that accompanied it.

The item came just after the Executive had discussed its financial performance in the 12 months leading up to April.

Last year the Council underspent its £360 million budget by £1.4 million, and Council Leader Susan Hinchcliffe said that just a few months ago the authority was in its best financial position for a decade.

But she said the current financial year would be a "different world."

She said: "We had to spend a lot to support residents and businesses through the period. We were told by the government to spend to make sure the people of our district had everything they needed.

Bradford Council is urged to spend its reserves

"Since then the message from Government has been much more watered down. They are not paying back all we have spent on people. It does concern me that the Government not fully accepting the commitment that Councils don't lose out. We are on the front line supporting residents with daily needs. The Government needs to fund what local government is doing rather than rely on Council Tax payers to bail them out due to their failings."

The meeting heard that the Council faced an overspend of £5.4 million this year for "non-Covid" reasons and up to £35 million additional costs for Covid reasons.

The Executive was asked to approve an additional £6 million of measures this year to help the District cope with the aftermath of the pandemic and lockdown.

The length of the pandemic, lockdown, and severity of the upcoming recession could mean the Council faces a funding black hole of anything between £25 million and £66 million by the end of March.

Andrew Cross, Project Accountant, told members: "Although the financial situation is severe, the Council's reserve levels are sufficient to withstand the additional costs this year, and are quite robust in comparison to other Councils."

At the end of May Bradford Council had £254m .in its reserves of this £222.1m were Council reserves and £31.9m were school reserves.

However, much of this is allocated reserves. There is currently £10.3m in unallocated reserves and £15m in General Reserves available.

Mr Cross referred to an announcement by the Government late last week that it was providing £500m of support to local authorities. The announcement had not yet been factored into the calculations discussed at the meeting, but amounted to £5m extra for Bradford.

There would also be support to minimise the impact of lost revenue from facilities like leisure centres and Council run theatres and more flexibility when it comes to repaying deficits of outstanding business rates.

Cllr Hinchcliffe referred to last week's announcement saying: "When I was told the Government had announced an extra £500 million for Councils I thought I must have heard wrong and it was £500 billion. Yorkshire and the Humber councils alone are facing a gap of £750m."

She added: "In February this year we were in better shape than we have been in 10 years of austerity. We were looking forward to investing and spending on growth projects for our district.

"The Covid came along."

Referring to the likelihood that the Council would have to dip into reserves to meet funding gaps, she added: "Reserves are for a rainy day, and it's raining."