Cross party call for cash for councils to support COVID crisis response

The Liberal Democrats are at the forefront of cross party calls for urgent additional funding for local authorities going "above and beyond" in their response to the COVID-19 crisis.

In a letter to the Chancellor and Secretary of State for Housing, Communities and Local Government, the cross party group of more than 20 MPs highlight the pressures cash-strapped councils are under, with a funding shortfall of £5 billion at a time when they are being asked to rapidly scale up support for the most vulnerable.

The letter raises concerns about the "fear and anxiety" of councillors on the ground, and calls on the Government to "bridge the gap" in funding as a matter of urgency, to protect the services and support communities rely on.

Tim Farron, Liberal Democrat Local Government spokesperson said:

"From day one, local authorities have stepped up to deliver local support through the COVID-19 crisis. They have gone above and beyond, from efforts to source protective equipment for frontline workers, to supplying emergency food packages to distributing business grants and so much more. These efforts have helped protect some of the most vulnerable, and they must continue.

"Local Authorities cannot keep going on a shoestring budget. The shortfall many are already facing is substantial and growing. Without an emergency cash injection, and a long-term sustainable funding plan, the lifelines offered by local authorities will no longer exist. Our communities will suffer enormously as a result.

"That is why we are calling on the Government to commit to a sufficient long term funding settlement for councils as an immediate priority. This is the only way to ensure our councils can keep vital services running through the current crisis and in the future.

"We are enormously grateful to those on the frontline, for example working in social care, but the tragic reality is the social care system will collapse if our local councils are not there to fund it."

The full text of the letter is below:

Dear Rishi and Robert

I am writing to you to commend and celebrate all the vital work that Local Authorities are undertaking to combat the present crisis. Now, perhaps more than ever, we are seeing the vital role that Local Government plays in our communities; funding social care; supporting the education of the most needy and vulnerable; providing housing in our communities. The work of Local Authorities impacts our lives every day. They are going above and beyond to meet our additional needs during this crisis in sourcing and distributing PPE, supplying emergency food packages, distributing business grants and so much more.

I welcome the funding that the government has pledged so far to support Local Authorities. However, this has been one off lump sums that are far from sufficient to meet the additional demands or provide councils with security to budget for the future. I am deeply concerned about the financial security of Local Authorities in both the long and the short term. Local Government data indicates that Councils are currently facing a funding shortfall of £5 billion, a shortfall that will only grow. This is a significant and worrying gap.

Alongside the increased expenditure there has also been a loss of funding from other income streams including council tax, parking, leisure services and commercial operations. In addition, councils will find it impossible to make the budget savings that they had planned this year as their focus is rightly on supporting their communities. On the ground, we are hearing the fear and anxiety of our Councillors as they battle to keep our communities safe, healthy and housed.

An increase on the demand for Local Government services is likely to be a long term outcome of the pandemic not just a short term consequence of the current demands. If we are going to sustain our social care sector, provide adequate support for the education of our children and ensure that everyone has a roof over their heads, we must address the shortfall in funding to councils as a matter of urgency. We must bridge the gap.

The government needs to provide a sufficient and long term funding settlement for councils as a matter of urgency. If our Councils are going to continue to support our communities they need more funding now and concrete assurance of funding into the future.

I look forward to your response.

Kind Regards,

Tim Farron MP

Virendra Sharma MP
Colum Eastwood MP
Caroline Lucas MP
Sarah Champion MP
Daisy Cooper MP
Layla Moran MP
Sarah Olney MP
Alistair Carmichael MP
Ed Davey MP
Wendy Chamberlain MP
Jamie Stone MP
Wera Hobhouse MP
Christine Jardine MP
Munira Wilson MP
Grahame Morris MP
Graham Stringer MP
Jon Cruddas MP
Andrew Slaughter MP
Apsana Begum MP
Geraint Davies MP
Hilary Benn MP
Rosie Cooper MP
Bell Riberio-Addy MP
Andrew Gwynne MP
Catherine McKinnell MP

Motion on funding for local government:

On 29 April 2020, Liberal Democrat MPs Wera Hobhouse, Tim Farron and Layla Moran, Green Party MP Caroline Lucas and Labour MPs Clive Betts and Catherine McKinnell, sponsored a motion calling on the Government to provide "the necessary financial support" to local authorities and "urgently clarify how and when that support will be distributed". Full details of motion and full list of signatories are available here.