Covid-19 Local Authority Revenue 2020-04-28
2020-04-28
TAGS
Response quality
Questions & Answers
Q1
Partial Answer
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Context
The question arises from the financial strain local authorities face due to the pandemic, including significant reductions in income and increased spending on frontline services.
What recent estimate has been made of the reduction in local authority revenue as a result of the covid-19 outbreak?
We are working closely with the sector to develop a good understanding of the pressures that local authorities are currently facing. We have announced £3.2 billion of additional funding and measures to support immediate cash-flow concerns. This is a very significant package of support, which responds to the range of pressures that councils have told us they are facing.
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Assessment & feedback
The estimate of revenue reduction was not provided.
Under Review
Response accuracy
Q2
Direct Answer
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Context
Wigan Council faces a significant loss of income and increased spending on frontline services as a result of the pandemic. The council has also lost dividend from Manchester airport, exacerbating financial pressures.
Wigan Council estimates that it will lose £40 million in income this year, while spending on frontline services has rocketed because of the coronavirus crisis. In addition, the loss of the dividend from Manchester airport will exacerbate that pressure.
Wigan Council has received £10.5 million of the original £1.6 billion that has been allocated to local authorities, and that funding is unringfenced so they can use it as they see fit. As the House will know, local authorities will be fully compensated for the business rates loss that they have incurred.
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Assessment & feedback
Response accuracy
Q3
Partial Answer
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Context
The Local Government Association and CIPFA advised that financial support is needed for councils experiencing reduced revenue from commercial sources. Luton Council's reliance on London Luton airport's income has been disrupted by the pandemic.
Luton Council relies on commercial income gained through its ownership of London Luton airport, which has dried up overnight. The Government promised to do whatever is necessary to financially support councils. When will they be introducing funding for councils that have lost considerable commercial income?
Luton Council has received £5.4 million of funding from the very significant package that we have put together. We have also deferred £2.6 billion in payments to central Government and we will work with local authorities to understand their particular needs.
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Assessment & feedback
A specific timeline for introducing funding was not provided.
Under Review
Response accuracy
Q4
Partial Answer
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Context
Manchester Council faces a forecasted loss of £125 million in income this year, resulting from the coronavirus crisis. This represents the funds that have kept services operational amidst previous public sector cuts.
The council is forecasting £125 million in lost income this financial year as a result of coronavirus. That money has kept services going in the face of some of the harshest cuts in the public sector and is allowing the council to lead the response to covid-19. Will the Minister pledge to fully reimburse councils for lost income?
Manchester has received £18.6 million in the first tranche of funds made available to local authorities, and more will come. We are going to work with local authorities to ensure that they get the help they need to see them through this crisis.
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Assessment & feedback
A pledge to fully reimburse was not given.
Under Review
Response accuracy