New coronavirus funding package "wholly inadequate"

  • By Gemma Kappala-R...

MHCLG has announced a funding package for local government to help address councils' coronavirus pressures.

In response Cllr Peter John, Chair of London Councils, said:

“£500 million for all councils in England is wholly inadequate - another short-term stopgap solution rather than the comprehensive package that was promised. It does not reflect the tough financial realities facing London local government, where the funding gap is already £360 million since March and is expected to rise to £1.4 billion over the whole year.  

“It is disappointing that the Government will only be partially funding lost fees and charges income – which will leave London boroughs with a shortfall of well over £200 million. This scheme should apply to all types of income not just fees and charges, and must be made available as a matter of urgency. We cannot wait until the year is over and the accounts are audited.

“Certainty over future funding is key to councils planning their budgets. Putting off dealing with business rates and council tax deficits until the Spending Review is a disappointing move from Government. Encouraging councils to recover these deficits over a longer time period may allow the Government to kick the can down the road, but councils have to take a more responsible attitude to the local public finances.

“To keep vital local services running, it is clear that we need to continue our work with Government to ensure they fully recognise the scale of the financial challenges London boroughs and councils across the country are grappling with. 

“We look forward to further, more substantial measures to support the recovery of local economies and local services when the Chancellor makes his statement next week."