A NORTH-East authority is facing an £8.2m shortfall as a result of the pandemic, which has cost it more than £20m so far.

Bosses at Middlesbrough Council have revealed there is a £8.2m shortfall facing the authority despite emergency Government grants.

The latest overview and scrutiny board heard how Middlesbrough Council had been provided with £10.7m for direct covid costs to date.

The bill for direct costs has come to £7.3m so far – giving the council an extra £3.4m to use.

But chief executive Tony Parkinson warned this sum had not yet factored in all the recovery costs – and whether it would be enough “remained to be seen”.

A scheme to replace lost income is expected to cover £4.9m but there is still an extra £2m deficit forecast here.

Delays in efforts to make savings are expected to cost the council another £2.3m while council tax losses have been estimated at £3.9m.

However, these tax losses can be recouped over three years, rather than one.

In all, it comes to an impact of more than £20m with a hole of about £8.2m.

Later, Mr Parkinson told councillors at the July meeting he believed this estimated figure would come down significantly in the coming months. But he was certain savings would need to be made next year.

He added: “We’ll have a much firmer handle on the costs by September – we’re doing some scenario planning, the intention is we’ll present the full financial impact to the executive in September along with an outline plan for our budget in 2020/21.”

The officer said figures moved week on week but believed there would be a shortfall. “We know we’re going to have to pick up just over 30 per cent of lost income and the bill for any savings that we don’t deliver – and we know we’re going to have to pick up the bill for loss of council tax receipts,” added Mr Parkinson.

Labour group leader Cllr Matt Storey said the council had not received everything it needed from Government.

Meanwhile, there was fresh concern at the latest corporate affairs and audit committee on July 29.

The panel agreed to write a letter to Teesside MP Simon Clarke in a bid to make the Government fund the authority’s growing covid bill in June. But officials revealed there had been no update on the letter yet.

Cllr Teresa Higgins said: “There’s no point in this committee making decisions and asking for things to be done if we’re going to get ignored.

“It was to help the council get some money – and if we’re not asking for money, they’re certainly not going to give us it.

“We desperately need more money.”

Neighbouring Stockton Council has also heard disquiet about uncertainty over future financial settlements from the Government.

Cllr Eileen Johnson was irritated by how local authorities had to plan their finances for three years but had no certainty about next year’s package of funding.

“Here we are however many years later and we’re still getting one year settlements,” she added.

“Isn’t it about time they caught up with local government and gave us a chance to budget properly?

“We can do it and we’re very good at it but this piecemeal approach, where we don’t know what we’re getting the following year because they change the rules and assessments, isn’t working.

“If we were a private business, there would be no way we’d be able to carry on like this.”

Government minister Mr Clarke said it was giving councils “unprecedented support”.

The MP for Middlesbrough South and East Cleveland added: “Middlesbrough and Stockton Councils have been allocated more than £23.5m in unring-fenced Covid-19 funding, with Stockton-on-Tees receiving more than £12.8m and Middlesbrough more than £10.7m

“In addition, the councils’ core spending power saw an increase of nearly £17.3m this financial year even before additional emergency funding was announced.

“Additionally the councils have access to a new government scheme that will compensate councils for irrecoverable income losses from sales, fees and charges.”