Covid-19 Support for Local Authorities 2020-07-07
2020-07-07
TAGS
Response quality
Questions & Answers
Q1
Direct Answer
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Context
Concerns about differential treatment of councils based on financial management and the need for capitalisation directives.
Fears have been expressed that poorly managed local authorities will be bailed out fully, while better-managed ones like Bromley may face shortfalls. Will the Minister reassure that support addresses varied needs? If funding gaps remain, will he consider allowing councils to fund through borrowing or capital receipts?
We have always taken the approach that borrowing is allowed for infrastructure and capital projects, but not day-to-day revenue. All councils have received support, including £16 million to Bromley. We are addressing varied needs with a comprehensive package.
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Assessment & feedback
Response accuracy
Q2
Direct Answer
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Context
Commercial investments made by councils to fund services are suffering losses due to the pandemic.
Local government has invested in commercial ventures to fund services. The package announced does not cover shortfall from these investments, which is affecting many local authorities severely. Will the Minister see to it that support covers this loss?
Commercial income carries risk for councils, we are aware. I advise councils at risk of section 114 notices to talk with the Housing Minister before making such decisions.
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Assessment & feedback
Response accuracy
Q3
Direct Answer
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Context
Councils need certainty in terms of funding for the pandemic. There is a one-size-fits-all approach which may not work.
The Prime Minister and Housing Minister have promised full support. Will the Minister reaffirm that pledge? Many councils are cutting services due to uncertainty over costs. Will he further commit to covering financial cost and social need for local authorities?
Costs for local councils will be uncertain due to lost tax income. We have addressed short-term pressure with £3.7 billion grant and additional funding, including £600 million for infection control.
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Assessment & feedback
Response accuracy