Already hard hit councils see revenues drop during pandemic – but Welsh Government point to UK Government for long term solution

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This article is old - Published: Sunday, May 24th, 2020

Local authorities across Wales could face further financial hardship after the pandemic if additional funding isn’t provided by UK and Welsh Governments.

As council business restarts in public there have been references to the funding of the Covid 19 response by local authorities, in a climate where many were making further cuts to already tight budgets. The pandemic has also seen some sources of income drop, for example carparking, with a different set of demands on a workforce often working remotely.

At the start of the pandemic UK Government said they would spend “whatever it takes” to tackle the virus, however in England some local authorities have found that is not as extensive as imagined despite sums being allocated.

Nearby Shropshire Council have written to the Chancellor detailing how their “share of that £1.6bn didn’t even cover our losses”, and Wrexham stating the multi million pound impact already.

We pointed to some concern from local authorities in Wales over the finances, noting many were already in a tight position before the pandemic, and asked the First Minister if he could give a clear commitment that councils in Wales will not be in a worse position at the end, and that all related costs will be covered by Welsh Government.

The First Minister said: “There are huge costs in all our public services. You can imagine what this is costing in the health service.

“We’ve already made extra allocations available to the social care system, and local government has been in the frontline of our response to coronavirus and has been a very effective player in it.

“So we’ve already provided £110 million pounds extra to local authorities, we are providing the revenue support to grant earlier in the year to make sure that they don’t simply run out of cash.

“We are agreeing with a Welsh Local Government Association further help that we can provide local authorities because of income that they have lost.

“Many local authorities rely on the income they get from sports centres that they run, or art centres that they are involved in, and all of that income has dried up, and we are going to assist them with the income that they have not been able to collect in that way in the longer run.

“Later down this year, it will have to be for the UK Government to assist as well.

“Local authorities in England are even in an even more difficult position with local authorities in Wales because their budgets have been cut far more over the years.

“In order to keep local authority services across the United Kingdom going it will be the UK government that will have to assist assist us, so that we can assist them.”

You can view the full briefing, along with the Q&A section on the below video: