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Derry City and Strabane District Council is projected to lose £10.7m this financial year due to the coronavirus crisis, a report has found.

The chief financial officer's report comes after warnings the council could become insolvent within months.

But the council is hoping to cut losses to just under £3m through government funding and internal cutbacks.

It has placed about 200 staff on the government's jobs retention scheme, which has been extended until October.

'Loss of revenue streams'

The report says the cash shortfall is because, during the pandemic, the council has not been able to generate the income it normally would.

Income from rates, leisure services, building control, tourist attractions and museums have all been affected because of the virus.

The report warns "the most critical risk facing council is depletion of its rate base, which funds 80% of council's overall annual gross expenditure each year".

It also says the impact of coronavirus is likely to be felt, not just this year, but over the next few financial years.

'Concerning and challenging'

On Tuesday, councillors will virtually meet to approve the steps being taken to combat the financial impact of the pandemic.

The governance and strategic planning meeting will propose to potentially recoup some of the losses through funding from the UK government.

The council anticipates receiving a £2m share of a £24m government package, designed to help all 11 councils in Northern Ireland recover from the pandemic.

It plans to freeze recruitment and save on training, travel, advertising and conferences, as well as reviewing capital projects where work has not yet begun.