Derry and Strabane District Council cash reserves will start to run out in 6 months without intervention committee told

The figure was revealed when the Stormont Communities Committee heard evidence from SOLACE NI, a membership network for senior local government officials from across the North.

The committee heard how councils are collectively projected to lose £41m in income as a result of the coronavirus pandemic over the mid-March to June 2020 period.

DC&SDC Lead Finance Officer Alfie Dallas, took part in the evidence session and told the committee that the £10m a month figure referred to “financial losses that we are currently incurring [all councils] and most of it does relate to the service income that was lost in leisure, off-street car parking, planning and building control”.

Mr. Dallas said the figure did not include the impact on the rates base that has also been decimated by the coronavirus pandemic.

David Jackson, Chief Executive of SOLACE NI, told the committee that some councils could run out of cash reserves in a few months.

He said one authority had mentioned the possibility of a future ‘30% rate increase’ to attempt to repair the financial damage wrought by COVID-19 and the lockdown.

Mr. Dallas said all councils had limited reserves.

“Six months was the average across NI to the point at which reserves would run out although some councils will obviously be quicker than that and some will be slightly more than that,” he said.

Referring to Derry City and Strabane, Mr. Dallas said: “I know that in terms of our council, six months, we are typical, that would be the time when we would run out of reserves.”

Mr. Durkan sits on the committee. He called for urgent collaborative working from all departments in order to safeguard the future of local authorities.

“This issue threatens all areas of council services including but not limited to local festivals and events, sustaining leisure centres, the upkeep of parks and the provision of weekly bin collections.

“The reality is, if the Executive refuses to bailout local councils, it will have a devastating impact on all facets of daily life,” he said.