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Councils in Kent lose millions from car parking charges because of pandemic


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Councils in Kent are counting the cost of Covid-19 after losing millions of pounds from car parking charges and some fear next year could be just as difficult.

The lifting of restrictions on non-essential shops next week is expected to give town centres and retail parks a much-needed fillip.

Political editor Paul Francis discusses the findings with Joe Coshan on KMTV

However, some analysts are predicting this short-term boost could disguise the fact that many shoppers will continue to do more purchasing online in the longer term.

Figures provided to KentOnline indicated that councils have lost at least £12m in parking revenue in 2020-21.

Some councils are taking a bigger hit as they have heavily invested in shopping centres as owners, exposing them to the additional pressure of declines in rents and business rates.

A government scheme under which councils can apply for funding to offset the lost revenue is due to end in June and it is unclear whether it will be extended.

Some councils have reported six-figure declines in parking revenue in 2020-21.

Some councils have reported six-figure declines in parking revenue in 2020-21. Stock picture
Some councils have reported six-figure declines in parking revenue in 2020-21. Stock picture

The biggest casualty is Canterbury, where the combination of a high number of tourists combined with other shoppers usually raises more than £8m from parking.

The council said the national lockdown had significantly dented income.

A spokesman said: "We will be facing a shortfall of £5m in car park revenue in 2020-21 compared to a gross budget of £8.5m in income.

But around 70% of the shortfall will be covered by the government's fees and charges income shortfall grant scheme.”

However, it warned: “Councils such as ours face a real financial challenge over the next few years.

Around 70% of the shortfall will be covered by the government's fees and charges income shortfall grant scheme. Stock picture
Around 70% of the shortfall will be covered by the government's fees and charges income shortfall grant scheme. Stock picture

"We have to balance our books overall while maintaining services people rely on day in and day out, reduce congestion and boost air quality and help the city centre in particular to remain vibrant and attractive to workers, visitors and shoppers.”

Among others losing out is Ashford council, which has estimated that income from parking will be halved to £1.2m, having budgeted for £2.4m in 2020-21.

A report on the drop says “Parking income is a significant income stream to the council with budgeted income of just under £2.4m for 2020/21.

"Given the restrictions on movement and reduced footfall seen in our towns, car parking income continues to be significantly reduced.”

Folkestone and Hythe council says it anticipates the loss of income from on-street and off-street parking charges is “likely to be in the region of £555,000 at the end of this financial year.”

'Given the restrictions on movement and reduced footfall seen in our towns, car parking income continues to be significantly reduced...'

It suggests next year will also see a decline, saying the budget for 2021-22 “has been prepared on the basis of an expected reduction in income from car parking charges of £442,000.”

Medway Council recently identified a potential budget gap of £710,000 in the amount it had forecast for next year from parking revenue, now estimated at £4.135m.

It has ended a four-year freeze on parking charges, meaning on and off street parking charges will increase by 20p.

That equates to a 40% hike for parking up to half-an-hour, where the charge will increase from 50p to 70p.

Another big casualty is Maidstone council, which is forecasting parking income will be £563,000, which is a shortfall of £1.658 million on its budgeted net income of £2.2m.

Medway Council identified a potential budget gap of £710k in the amount it had forecast for next year from parking revenue, now estimated at £4.135m. Stock picture
Medway Council identified a potential budget gap of £710k in the amount it had forecast for next year from parking revenue, now estimated at £4.135m. Stock picture

Neighbouring Tonbridge and Malling council is also bracing itself for a significant reduction. In a statement, the council said: “Car parking income is down by some £1.9m compared to that originally budgeted for the year 2020/21.”

“Car parking income going forward is difficult to predict and very much dependent on the extent and speed of the recovery and societal changes as a result of the pandemic.”

Gravesham council said its income for this year from parking was £1,018m short of what it had budgeted for and had calculated that it would see a further loss of £393,750 next year.

The government has met some of the shortfall through grants to local councils which amounts to reimbursing them to about 70% of their expected income.

However, it has not been announced whether that level of support will be repeated next year.

'Car parking income going forward is difficult to predict and very much dependent on the extent and speed of the recovery and societal changes as a result of the pandemic...'

An Ministry of Housing,Communities and Local Government (MHCLG) spokesman said: “The government has introduced a co-payment scheme to compensate local councils for lost income from sales, fees and charges, including council-owned car parks and leisure centres, which has been extended for a further three months until the end of June 2021.”

“This is in addition to the over £3 billion of support we have committed for Covid-19 in 2021-22. This takes the total support committed to councils in England to tackle the impacts of Covid-19 to over £11 billion.”

Motoring group the AA said councils faced difficult choices between potentially higher charges or leaving fees as they were.

Jack Cousens, head of roads policy for the AA said: “They do have a really difficult decision to make. Do they stick with the status quo, so whatever the fees were last year, that's the fees they carry over, and hope that is enough of an enticement to draw people back to the High Street?”

“Let's not forget that local retailers and those independent retailers in those high streets will be begging local authorities not to do something silly like introduce incredibly high charges, because that will stave off their growth.”

Jack Cousens of the AA says councils have a difficult decision to make on whether to hike up parking charges. Picture: AA
Jack Cousens of the AA says councils have a difficult decision to make on whether to hike up parking charges. Picture: AA

Higher charges could also result in more motorists parking in residential streets close to town centres, often a cause of friction.

Drivers were prepared to use alternative schemes like park and ride so long as it was reasonably priced and efficient, he added.

Analysis

No-one likes paying for parking: it is one of those unloved costs where no-one ever returns from emptying their pockets of small-change and declares "well, that seems pretty reasonable."

It is why councils tread warily around the issue in fear of a popular revolt if they get their pricing wrong. They have good reason to be sensitive about the income they receive - it is an awful lot of money and adds to the sense that councils are the equivalent of a motoring highwayman.

The alternative? Perhaps it is time for some bold thinking in the wake of an unexpected pandemic which has caused many to reflect on whether the daily commute, the supermarket shop or the trip to the cinema can be done differently.

We live in a fast-moving world where solutions have to be found that address a whole range of different issues that were not on the horizon five or 10 years ago.

Head to our politics page for expert analysis and all the latest news from your politicians and councils.

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