Nottingham City Council has secured £11.7m of extra funding from Government this year.
The Labour-run authority has been told its provisional settlement from Government is £305.9m compared to £294.2m previously.
But interim corporate director of finance, Clive Heaphy, told an Overview and Scrutiny Committee on Wednesday, January 5, around £4m is likely to be shaved off the extra £11.7m.
This will be to pay for the increases in national insurance contributions as part of the healthcare levy and the national living wage, such as for adult social care contractors.
Concerns were raised by Cllr Georgia Power (Lab) about whether the Government would close a Covid funding gap of £16m.
She said: “Our spend for Covid was £66m and the Government funded £50.1m so we are still £16m short of what we spent on Covid to date. Has there been any indication from Government they will fill that £16m gap?”
Mr Heaphy said the £16m gap was largely due to the ‘loss of income’ accrued by the council during the pandemic.
This can include, for example, loss of car parking revenue and concert tickets from companies it owns such as the National Ice Centre.
He said there was “no indication – not at all” that the Government would repay this money.
However, he said the Government settlement was the “most generous settlement we have seen for some time” compared to the reductions the authority had encountered year-on-year.
He said: “Overall, relatively good news for the council. But how does that compare with the sector? In terms of England as a whole our spending powers go up by 7.05 per cent.
“We have done better than England as a whole.
“When we look at the core cities, we are slightly below the average of 7.3 per cent and Manchester have done particularly well out of it (with 8.42 per cent). We are in the middle of the pack. It is disappointing we are not near the top but none the less it is still a boost.
“We will end up in a better place, the gap will be lower as a result of that, but the gap will not be taken away. There is further work around transformation to close that gap.”
Currently, the council is set to save £38m over the next four years with plans drawn up by March this year on how it will attempt to deliver those savings.
It also plans to raise Council Tax by 1.99 per cent and implement the Government’s one per cent social care precept.
