WELSH Ministers have this week announced a funding boost of more than £260 million for local councils in Wales to provide them with the certainty they need to plan for the remainder of the year.
It will help cover increased costs, manage loss of income pressures, and will fund additional cleaning requirements for schools in response to the coronavirus crisis.
With the real possibility of further peaks during the autumn and winter months this investment will provide local authorities with the confidence to prepare their budgets for a potential second wave. The funds will be allocated on a claims basis.
UNPRECEDENTED
Minister for Housing and Local Government Julie James said: “Our local authorities have done a fantastic job of rising to the challenges of Covid-19, but we recognise the financial impact this has had on them.
We have been working closely with the Welsh Local Government Association (WLGA) and local authority leaders to understand the pressures and challenges they are facing, and the support needed to continue delivering good quality, integrated public services to communities across Wales.”
Finance Minister Rebecca Evans added: “Local councils have been at the heart of our response to Covid-19. This new package of financial support recognises the scale of the unprecedented challenges being faced by authorities across Wales and provides them with the certainty they need to continue to respond to the crisis and prepare for the rest of the financial year.”
Cllr Anthony Hunt, WLGA Finance and Resources told The Pembrokeshire Herald: “Councils, and the vital local services we provide, are at the forefront of tackling this pandemic and have been under extreme financial pressure. This funding guarantee will give them the confidence to plan with greater certainty for the remainder of the financial year.
I want to thank Welsh Government for working closely with local government on this funding package, and for taking the time to understand the pressures facing local services.
CONSERVATIVES CONCERNED
Reacting to the announcement this week (Aug 17) Shadow Minister for Local Government and Housing – Mark Isherwood MS – said: “According to the Welsh Government, this brings the total in the pot to stave off the worst effects of the pandemic to almost half a billion pounds.
“However, Welsh Conservatives’ analysis earlier in the year indicated that local authorities were likely to lose tens of millions of pounds revenue each month because of the outbreak, with deficits in Q1 and Q2 already totalling almost a third of a billion pounds* by the end of September.
“These losses of revenue could take generations to recover from, and we need to see just what the long-term plan is to prevent local authorities finding themselves in an even worse position.
“The Welsh Local Government Association’s (WLGA) own modelling suggests that that there is the potential for budget shortfalls depending on several complex and inter-linked factors, and so flexibility is more key now than ever.
“The Minister and her Party must be willing to consider all options to ensure that Councils can continue running their services.
“We Welsh Conservatives have already proposed capitalisation, which would allow for specified revenue expenditure to be viewed as capital expenditure, and so can be funded from capital resources such as borrowing, to provide financial flexibility to meet unexpected one-off costs.
“The WLGA has also pressed the Welsh Government to allow local authorities to borrow and invest in several significant capital programmes.
“By doing so, these actions would contribute to a wider economic stimulus package whilst simultaneously helping to improve performance and outcomes in relation to a range of other important shared policy objectives. The proposal totals £762m and would also help to ‘lock in’ and build upon positive, transformational changes already introduced to services in response to Covid-19.
“We cannot afford to let the effect of this virus damage local authorities’ ability to run as effectively and efficiently as they can.”
