The coronavirus pandemic could cost Halton Council £300,000 in lost rent as businesses continue to struggle.

The cash-strapped council has already lost £220,000 as a result of giving its business tenants a rent holiday.

But since that rent holiday ended in June, more than a quarter of the council’s tenants have fallen into arrears, raising fears that more of them could go out of business.

In response, Halton Council’s executive board agreed on Thursday to offer business tenants either a temporary rent holiday for up to three months, or a permanent rent reduction of up to 10%.

Halton Council’s finance chief, Cllr Mike Wharton, said: “Whatever we can do to help businesses at this very bleak time, I think we should obviously endeavour to do.”

The policy would be implemented on a case-by-case basis, with businesses having to show they had been impacted by the Covid-19 crisis.

Papers presented to Thursday’s executive board meeting said a 10% rent reduction could cost up to £88,000, but warned the figure could be higher if the council did not intervene and tenants went out of business.

Cllr Wharton said: “The policy tries to balance a pragmatic approach, realising the challenges businesses are currently facing, but at the same time recognising that any reduction will impact the council’s income target.”

The council is already facing a significant overspend this year as a result of both the pandemic and increasing pressures in areas like children’s services and social care.

In the last financial year, Halton Council was £5.3 million over budget and is currently forecasting a shortfall of almost £7 million for this year.

But Cllr Wharton said he hoped providing additional support for the council’s business tenants would mean they could keep going “over a difficult period” and would subsequently be in a position to pay the council back.

Council leader Rob Polhill added: “Businesses are going through a very very tough time at the minute, so we need to do whatever we can to help them.”