Local Government Finance: Coronavirus

Ministry of Housing, Communities and Local Government written question – answered on 7th September 2020.

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Photo of Colleen Fletcher Colleen Fletcher Opposition Whip (Commons)

To ask the Secretary of State for Housing, Communities and Local Government, whether he has made an assessment of how much each local council has (a) spent on dealing with the effect of the covid-19 outbreak and (b) lost in revenue during that outbreak.

Photo of Simon Clarke Simon Clarke Minister of State (Housing, Communities and Local Government)

We have now carried out four rounds of the Covid-19 financial monitoring survey and have received data from all local authorities. The vast majority (96 per cent) of councils surveyed have responded to all four rounds, with the remainder having submitted returns in three of the four rounds, which means that we have a fully representative dataset from which to inform our understanding of councils’ evolving financial situations as they continue to respond to the pandemic.

In the fourth round of the survey, local authorities estimated they faced £2.5 billion in additional expenditure pressures and income loss of £3.6 billion from March to the end of July. On 19 August, we published a summary of the results of the fourth round. This can be found at https://www.gov.uk/government/publications/local-authority-covid-19-financial-impact-monitoring-information. We will publish the results from Round 5 of the survey in due course. We are committed to being transparent about the pressures councils are under, which is why we have published the breakdown of results.

We have provided councils with an unprecedented package of support, allocating £4.3 billion of support for spending pressures, including £3.7 billion of un-ringfenced grants and the £600 million Infection Control Fund. This direct financial support the Government has provided is part of comprehensive package of support which includes cashflow measures, support for the homeless, and for bus and tram services – not to mention grants and business rates reliefs for businesses. In total, the Government has committed almost £28 billion to local areas to support councils, businesses and communities

The?Government?has also?confirmed that it will extend the period over which councils must manage shortfalls in local tax income relating to 2020-21, from 1 to 3 years. This will ease immediate pressures on authorities when budget setting for 2021-22, protecting their ability to deliver essential local services.?We?will announce?further?details?of how it will also support?local?authorities to?manage?tax losses?at the comprehensive spending review later in the year.

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