“Back in March, the housing, communities and local government secretary, Robert Jenrick, pledged that his department would do “whatever is necessary” to help council leaders cope with the fallout of the coronavirus crisis. Urgent decisions, Mr Jenrick said, should not be put off because of concerns about money.”
The minister was taken at his word. Impoverished by 10 years of savage cuts from previous Conservative-led administrations, local authorities nevertheless stepped up to the plate. As the government’s lack of strategic planning was exposed, they battled to provide missing personal protective equipment for care workers. Rough sleepers were housed and extra mental health support offered to vulnerable people. As reports of domestic abuse rose sharply during lockdown, extra resources were deployed to deal with the caseload. Community hubs have been set up to facilitate food distribution and fuel assistance. Across the range of frontline services, a colossal, costly attempt has been made to rescue and preserve the battered infrastructure of everyday life.
As a result, councils are now swimming in a sea of unsustainable debt. Outgoings exponentially increased as income streams collapsed during lockdown. From parking fees and business rate taxes to returns on commercial investments, the money that keeps local authorities afloat has dried up. Manchester city council projects an overall loss of almost £152m for 2020-21. Liverpool city council is on the verge of filing a section 114 notice – effectively a declaration of bankruptcy. Relatively prosperous shires are suffering too. The Conservative MP for Shrewsbury, Daniel Kawczynski, has highlighted the case of Shropshire council, which has so far incurred coronavirus-related costs of well over £20m. A social “calamity” awaits, he has said, unless Westminster fulfils its promise to stand by councils during the crisis.
But as the calls for financial assistance have become more urgent, Mr Jenrick’s responses have become more evasive. Last week, the airy rhetoric of March was superseded by a warning that councils should not “labour under a false impression that what they are doing will be guaranteed funded by central government”. This amounts to a betrayal of trust. The government has moved to bring forward some payments to councils due later in the year, but a far bigger injection of new money is required. Failing that, it may be that the coronavirus crisis will prove a disastrous tipping point for local authorities, which have been relentlessly harried, hobbled and undermined by Whitehall for 10 years.
The austerity drive launched in 2010 by the former chancellor George Osborne turned out to be a declaration of war on municipal England. Almost £16bn of core local government funding was cut – or 60p in every pound provided from Westminster for local services. Council tax rises were legally capped, as care budgets were slashed and amenities closed. Poorer regions, with smaller tax takes, suffered the most. After a decade of devastation, there are, as the leader of Manchester city council, Sir Richard Leese, wrote to Boris Johnson last month, “no easy cuts left to make”. Without a new settlement adequate to the times, vital needs in our towns, cities and rural areas will go unmet.
That prospect could not come at a worse time, as the nation faces the sharpest economic downturn for 300 years. Instead of hanging local government out to dry, Mr Jenrick should be finding ways to put it centre stage in the “test, track and trace” strategy that will be key to reopening the economy. As the Local Government Association has pointed out, public health teams deployed by councils have unmatched local knowledge and experience. This expertise risks being underutilised as contact tracing contracts are shortsightedly handed to private operators such as Serco.
In the months to come, councils will also bear responsibility for maintaining levels of social care in the community, ensuring safe provision of public transport, helping local business and providing the essential services celebrated on our doorsteps each Thursday evening. For too long, local government has been treated with ruthless disdain by ministers in London. In this time of crisis, Mr Jenrick has the opportunity to make amends. It’s time to give councils the funding and respect they deserve.