Coronavirus costs are soaring whilst income is drying up, and ministers are seen to be shifting their tone to ‘sharing’ the financial burden with Councils causing a ‘critical’ loss.
The Mayor of Salford, Paul Dennett, has written to the Prime Minister, urging him that it is ‘imperative’ that he stay true to his promise that whatever is spent on the Coronavirus crisis will be reimbursed in full.
The letter was triggered by the worrying change in language of the Secretary of State suggesting that local governments must now ‘share the burden’ of this crisis.
Councils were told to spend whatever was needed to respond to the current crisis & we’d be compensated. However, we’ve recently noticed a concerning shift in language use by the government to: “sharing the burden”. Please see my letter to the Prime Minister today @LGA_Labour 👇🏻👇🏻 pic.twitter.com/FMLxSC8z0G
— SalfordMayor (@salford_mayor) April 20, 2020
After a decade of austerity, Salford City Council funding predicts Covid-19 will cost an additional £33m, from loss of income and due to the additional demands placed on services.
The government support to date only amounts to around a third of the sum.
In his letter to the PM, the Salford Mayor wrote: “Anything other than full funding of local government for our response and funding for longer term financial stability would be a betrayal of the critical front line workers in local government, and the people of Salford.”
The economic lockdown means that it is now almost impossible to generate money through investments or business; government grants have dropped off, as well as the ability to raise money from council tax being capped by ministers.
The surrounding boroughs of Manchester are equally impacted, with Oldham council expecting a £46m hit, Stockport £40m, and Trafford at least £37m hit in the coming six months.
Salford Mayor wrote: “I want to be clear – any shortfall in funding support from the Government will mean cuts to front-line services, job losses and increased unemployment, impacts for our local supply-chains, the community and voluntary sector, local businesses and a diminution in the support we are able to provide to our most vulnerable residents.”
Following queries from Salford Council alongside others, the funding issue was addressed by Chancellor Rishi Sunak, at the Downing Street media briefing yesterday.
Chancellor Sunak stressed that the government ‘absolutely’ wants to support local government through the crisis, and are committed to sanding ‘shoulder to shoulder with those on the frontline.’
A spokesperson for the Ministry of Housing, Communities and Local Government said: “The Secretary of State has announced a further £1.6 billion of funding for councils. Taking the total additional funding to help councils respond to the pandemic to an unprecedented £3.2 billion.
“This new funding will support them through immediate pressures faced by councils as they protect vital services at this challenging time.”