A county council may furlough its staff as it looks to plug a £10 million deficit left by the coronavirus.

Cabinet members could be putting staff on “furlough” as it looks to plug a £10 million hole that the coronavirus pandemic has ripped in the Powys County Council budget.

At the meeting scheduled for Tuesday, 5 May, Powys council’s head of finance, Jane Thomas (pictured), will lay out the cost of dealing with the pandemic.

The worst case scenario is that Powys council could run out of cash.

At the moment, Ms Thomas says the council is losing £3,350,000 a month.

By the end of June it is calculated that £10,038,000 will have been lost.

At the beginning of the crisis, the council implemented its Business Continuity Plan to focus on ‘business critical’ activities such as social care.

Several hundred workers were moved from their usual work and redeployed to what the council considers “essential” services.

Ms Thomas explained: “It is difficult to make an accurate assessment when we are only three weeks into the financial year.

“We do not know how the situation will develop or even for how long it will continue.

“We have however assessed the budget and categorised the main areas of potential impact.

“Based on this initial assessment it is clear that the impact of the virus will have an unprecedented detrimental financial impact on the council.

“Without further government support the council may not be able to financially sustain itself for the current financial year.”

Ms Thomas stressed that Powys is not a unique case, and that every local authority in Wales is in the same boat.

Ms Thomas added: “We have not considered furloughing of staff to

date as we were advised initially that it did not apply to the public sector.

“However, in recent days the local government minister, Julie James, has indicated that furloughing is an option that councils should consider to mitigate the loss of income.”

Ms Thomas also said that heads of service will need to start looking at any saving proposal that can be done quickly.

Powys has a workforce of over 4,200 full-time equivalent posts and furloughing is the government-funded Coronavirus Job Retention Scheme that helps employers cover staff costs.

They can keep employees on the payroll who have been asked to stop working, and workers could get paid 80 per cent of wages, up to a monthly cap of £2,500.

The figures estimate that by June, Powys council will lose £6,395,000 from income it collects such as car parking fees, licence fees, planning/building control fees, cultural venues, leisure centres/sports facilities, bus revenue and industrial units/property rents.

Part of this year’s budget had been based on a calculation of £10.7m of cuts and efficiency savings being delivered to balance the books.

The report shows that by June, the savings target will be £2.356m behind schedule.

The cost pressures due to coronavirus have also been calculated as £3.377m with the council receiving £2,044m in Covid grant funding from the Welsh Government.

Any shortfall would need to be funded Powys council’s reserves.

On 31 March the total reserves stood at £26.96m with over half of that – £13.969m – in ring-fenced accounts.