COVID-19: Councils losing tens of millions of pounds supporting businesses through pandemic

Local authorities are losing tens of millions of pounds supporting struggling business tenants through the pandemic which could have dire and long-lasting consequences for local services, Sky News has found.

Helen-Ann Smith, business correspondent and Madeline Ratcliffe, economics producer

Freedom of Information requests reveal English councils have already written off at least £19.7m associated with measures to support local businesses, including rent relief, rent renegotiations, payment holidays or business tenants going into administration.

A further £5.8m was lost as a result of Company Voluntary Arrangements (CVAs). These are arrangements where companies on the brink of insolvency negotiate debt repayments with their creditors in order to stay afloat – in this case, rent and rates paid to the council.

Lost income from business tenants is just one factor currently wreaking havoc with local authority budgets. Following 10 years of austerity and cuts, many fear it will amount to a crisis for local services.

Of the 272 councils who responded to Sky News, 124 – or 46% – confirmed they had lost income as a result of their own business support measures, such as rent holidays or having rent withheld since March.

Between 100 councils, £19.7m had been lost as a result of business measures. Barnsley was the worst affected, having written off £2m by mid-November.

In Barnsley town centre it is easy to see why as whole streets are now shuttered, with businesses reliant on support packages to survive.

Carl Esberger, who runs BigWicks homeware shop, sums it up:

“As long as I can keep a high street presence I will, but I think if there were no grants available for the high street, then I would be closed – like many have,” he said.

The pressure also comes at a time when many councils can ill afford it.

Austerity hit local government hard. Barnsley council’s budget is already roughly 45% of what it was a decade ago, which has meant fewer libraries, family centres and street services.

“Over the last 10 years we’ve made about £120m worth of cuts,” said Sir Stephen Houghton, leader of Barnsley Council.

“Next year, we have to find another £7m. So just when we thought we were getting out of austerity, things were beginning to bottom out, COVID’s come along and given us some more.

“You’ve got this income gap that maybe is not temporary but permanent. And how are we going to deal with that?”

The only way, he says, is by cutting local services. The impact will be felt in communities.

Charlotte Williams runs The Station House Association charity that provides early years care for vulnerable families and, although it is independent, it does receive some funding from the council.

“The most important work that we do with the council is the preventative stuff, and that’s always the stuff that seems to get cut,” she said.

“On a really practical basis for our families, there’s a need for lots of little bits of help and support.

“If you take any one bit away, it’s a bit like playing Jenga – you can take a few bits away and families survive, but if you take enough of those little slivers of support, it collapses and we go back to a time where unemployment is normalised, we go back to a time where people are solely reliant on benefits, we go back to a time where people are living in poverty.”

She said she worries about the coming years.

“We are pretty resilient people in Barnsley, you know we’ve been through quite a lot, but you can only chip away so much,” she added.

Nationwide, CVAs were responsible for a further £5.8m hit to councils, with a number of household name businesses availing of them.

Travelodge has CVAs in place that affects 15 councils. Mansfield District Council alone has lost £1.1m as a result of Travelodge’s CVA.

The company, whose shareholders include Wall Street giant Goldman Sachs, was forced to amend its restructuring offer to landlords last year after it faced backlash.

New Look, which has also received criticism for its use of CVAs, was responsible for hundreds of thousands of pounds in losses for 10 council landlords as well.

CVAs are supposed to be the last resort for companies looking to renegotiate debts on the brink of insolvency, but some believe they are now being used unnecessarily.

Melanie Leech, chief executive of the British Property Federation, said: “What we’re seeing is an increasing use, misuse of CVAs, cynically being used by owners who have taken value out in the good times, not prepared to invest back in the bad times.

“They are taking advantage of the legislation and the way it’s currently framed in order to write tear up leases, walk away from obligations freely entered into at our expense.”

The companies insist the CVAs were necessary.

A New Look spokesman said: “We launched our CVA in August last year out of absolute necessity, to safeguard the company, our employees and our suppliers.

“It was a measure we were forced to take as a result of COVID-19 changing the retail environment beyond recognition.”

Steve Bennett, Travelodge property director, said: “The COVID-19 situation has created unprecedented challenges for the whole UK hospitality industry, we have worked closely with our landlords to try to find the best possible path forward.”

Sky News’ FOI also confirmed Boots has withheld hundreds of thousands of pounds from councils.

The company was widely criticised last year for aggressive rent renegotiation during the pandemic, withholding service charges and rent due from its landlords.

Sky News’ figures reveal one council was owed as much as £143,000 in rent by Boots by the beginning of December.

“I’m pleased to say that the vast majority of our landlords we’ve now come to an agreement with and we’re now paying our rent as normal and I think that’s the way we want to be, but I just didn’t think it was fair that we should carry the whole burden.”

The December 2020 Local Government Finance Settlement does set out an increase in core funding for English councils of up to £2.2bn and highlighted £3bn of additional support for COVID-19 costs.

However, of the £2.2bn increase in core funding, £1.9bn is expected to come from increases in council tax bills of up to 5%. It assumes councils make full use of the allowable increases.

Taunton Racecourse the latest Covid-19 vaccination site from next week

TAUNTON Racecourse is being turned into a large Covid vaccination centre from Monday (January 18).

The site will open seven days a week, 8am – 8pm to offer the Covid-19 jab to people across Somerset, supporting the accelerated roll out of the local vaccination programme.

[Owl has already received reports of over 80s in the western half of East Devon receiving letters of invitation who have yet to be invited to a more local centre. It seems the “within 45 minutes” is a bit elastic. Just how well is Devon currently being served and are these mega site being given priority over GP run services see this post? Accessibility is an important factor for the elderly.]

Phil Hill

The racecourse will be providing vaccines for people in the highest priority groups including the over 80s and health and care staff.

Health and care organisations have been working together over the last few weeks to put detailed plans in place to prepare the site to deliver the large scale vaccination programme.

Alison Wootton, Joint Senior Responsible Officer for the Somerset Covid-19 Vaccination Programme, said “This is a really exciting development in our local fight against the coronavirus pandemic. We are really pleased to use the racecourse setting in addition to the thirteen GP-led community sites and two hospital hubs already in place”

“We know that many people have been eagerly awaiting the news of any additional large scale vaccination centres and we’re confident that this large scale site will rapidly increase the number of people that can be vaccinated quickly and safely across Somerset.

“We are very grateful for the phenomenal support of all our health and care colleagues for their enthusiasm and dedication in the roll out of our vaccination services across Somerset, and to the hundreds of volunteers who have offered their time to support the smooth running of our new vaccination centre and our GP led community sites.”

Over the weekend, NHS letters will be sent to local residents from the priority groups who live up to 45 minutes away from the new site.

People will be invited to book their jab through the new national booking services by phone, or online. The centre will be an additional option for people to have their Covid-19 jab, but people can also choose to wait to be called by their local GP surgery if they prefer.

Trudi Grant, Director of Public Health at Somerset County Council said: “I’m thrilled Taunton Racecourse is set to start vaccinating those in priority groups from Monday. This will substantially increase the number of vaccinations we are delivering across Somerset and help protect our most vulnerable from this deadly disease.

“I want to thank everyone who has been involved in setting up and organising all our vaccination centres in such a short space of time, including the NHS, Somerset County Council staff, our District Council partners, community groups and volunteers. This really is the largest vaccination programme ever delivered in our living history.

“We’ll continue to contact you when it is your turn to be vaccinated – and please remember to continue to abide by the ‘hands, face, space’ message, even after you’ve been vaccinated.”

The new large vaccination site will continue to offer vaccinations to the priority groups as identified by the Joint Committee for Vaccination and Immunisation. It is anticipated that once fully operational the site will be able to deliver around 900 vaccinations a day.

Bob Young, Managing Director of Taunton Racecourse added: “Taunton Racecourse is very pleased to be able to help the NHS by accommodating the vaccine centre.

“We are all immensely grateful and full of admiration for our NHS staff and hope that the people of Taunton and surrounding areas will benefit from a vaccination jab as soon as possible.”

People should continue to wait to be contacted by the NHS, either by a letter or phone call – please do not call the race course, or turn up without an appointment.

Healthcare teams are working extremely hard to vaccinate our most vulnerable groups as quickly as possible. Please be patient and the NHS will contact you directly when it is your turn – don’t call your GP surgery or local hospital to ask about your appointment.”

People are asked to support the NHS:

•Don’t contact the NHS or visit any of the vaccination sites to ask about your vaccine – you will be contacted;

•When you are contacted, attend your booked appointments;

•Follow all the guidance to control the spread of the virus and save lives.

Cornwall to host G7 summit of world leaders

Cornwall has been chosen to host the international G7 leaders’ summit in June in what is likely to be a landmark first meeting between world leaders since the start of the coronavirus pandemic.

Chris Matthews

It comes after speculation grew in recent days and was then confirmed by the government earlier today before being formally announced tonight. [16 Jan]

Organisations across Cornwall have welcomed the news, pledging an event that will leave a lasting social and economic legacy to benefit all of the county’s residents.

The major three-day international event will see leaders from the UK, Canada, France, Germany, Italy, Japan and the United States, as well as invited leaders from Australia, India, and South Korea attend. It could also be Joe Biden’s first trip to the UK as President of the US.

The event will host world leaders at Carbis Bay, with neighbouring St Ives and other sites in Cornwall, such as Falmouth, hosting international delegates and media – with organisers determined to make this an event for all residents in Cornwall to experience and share.

The Prime Minister Boris Johnson has spoken of the upcoming event, describing it as “a crucial summit”.

It will be the 46th meeting of the G7 leaders. The 2020 event, set to take place in the United States, was cancelled due to the Covid-19 pandemic.

Mr Johnson said: “As the most prominent grouping of democratic countries, the G7 has long been the catalyst for decisive international action to tackle the greatest challenges we face. From cancelling developing world debt to our universal condemnation of Russia’s annexation of Crimea, the world has looked to the G7 to apply our shared values and diplomatic might to create a more open and prosperous planet.

“Coronavirus is doubtless the most destructive force we have seen for generations and the greatest test of the modern world order we have experienced. It is only right that we approach the challenge of building back better by uniting with a spirit of openness to create a better future.

“Cornwall is the perfect location for such a crucial summit. Two hundred years ago Cornwall’s tin and copper mines were at the heart of the UK’s industrial revolution and this summer Cornwall will again be the nucleus of great global change and advancement. I’m very much looking forward to welcoming world leaders to this great region and country.”

Julian German, leader of Cornwall Council, said: “This is a fantastic opportunity to showcase the best of Cornwall and the UK on the world stage, and to build our strength and prosperity at home.

“For those reasons we are determined that this event delivers a lasting legacy for our residents, inspires our young people and shows how we can play our part in bringing the world together after the unprecedented challenges of the pandemic – and bringing together all parts of the UK together, leaving no-one and nowhere behind.

“We want a lasting legacy that maximises inward investment, translating our moment on the global stage into trade. A legacy that helps Cornwall bounce forward and make its full contribution to the country’s ambitions in areas like space and satellite, floating offshore wind and other sources of clean energy, and globally significant geo-resources including lithium to power our future.”

Chief Constable Shaun Sawyer QPM, of Devon & Cornwall Police, added: “I am delighted that Cornwall will be hosting this landmark event for the United Kingdom in an area that is not only one of the safest in the country, but also combines breath-taking scenery and innovative businesses with exceptional local hospitality.

“The event will be a real boost for our communities and especially our young people. It provides an opportunity for all my colleagues within Devon and Cornwall Police to demonstrate our operational excellence and world class policing skills on a global stage.

“We are excited to be playing our part working with and supporting our partners to deliver a safe and secure G7 summit. We have been preparing for this event for several months, including speaking with colleagues who have managed similar events, so we can ensure that we continue to effectively serve our local communities in the run up to, during and after the event.”

Visit Cornwall estimates a total economic impact of the Summit for the county of £50m, including both the immediate benefits of the Summit and related events, and projected tourism growth over the next five years.

Malcolm Bell, chief executive of Visit Cornwall said: “Cornwall has been voted the best holiday region in the UK for 10 out of the last 11 years in the British Travel Award but is little known to many countries around the world.

“The G7 Leaders’ summit will shine a spotlight on our very special place and the worldwide exposure is promotion we could never buy.

“It will showcase the beauty of Cornwall and provide an opportunity to highlight our heritage, culture and the connections to each country, which will help drive increased numbers of international visitors to Cornwall over the next decade.”

Mark Duddridge, chair of the Local Enterprise Partnership, said: “Cornwall’s economy is quickly evolving into one of huge significance to the challenges of the time most notably in the delivery of clean energy from our unique geology and location.

“Underpinned by our digital connectivity and creative expertise our traditional industries are developing their offer to deliver more to their customers whilst supporting the recovery of our climate and ecology.

“We welcome the opportunity to showcasing the new Cornwall to visitors from around the World and sharing our excitement for the changes that are now happening around us.”

Peter Andrew MBE, chair of Corserv Group, said: “The Corserv Group is delighted to have been asked to support the logistical arrangements to welcome the G7 Summit to Cornwall – a fantastic opportunity to raise the profile of our beautiful Duchy.

“Cormac Highways and Environment and Cornwall Airport Newquay continue to work closely with the organising authorities to ensure that the event runs smoothly in June. The Cornwall Development Company will be working hard with partners over this period to secure a lasting legacy in terms of inward investment.

“Over the coming months many of our staff will become involved in the logistical arrangements and we are committed to ensure that the event is a great success for Cornwall and see it shine on the world stage.”

Rural Proofing response will be guided by Labour’s motion says Cabinet at Devon County Council

A motion on “rural proofing” Devon County Council (DCC)’s policies, from Labour’s Cllr Yvonne Atkinson (Alphington and Cowick division), Labour’s lead on rural affairs came before the Cabinet on Wednesday 13th January.

The motion sought to make challenges and opportunities faced by rural Devon integral to policymaking, with Cllr Atkinson saying she tabled it because “ Devon is being left behind by the Tories as they concentrate on the Red wall in the North.” A Rural impact assessment from the outset, including engagement with rural stakeholders, means “the needs of rural communities will become  transparent and would demonstrate whether government or local  policies address the needs of rural communities and rural economies like Devon.”

Cabinet members voted in favour of using Labour’s “Notice of Motion” to guide its response to a promised Government report on rural proofing. A briefing prepared by officers noted that rural England faces new challenges and opportunities from EU Exit, declining farm profitability, changing consumer and live/work patterns, an ageing population, housing affordability, access to services, training provision, banking and high speed broadband in certain areas, climate change and new technology.

The briefing noted rural opportunities in environmental, agri-tech, energy and digital sectors, and strong economic interplay between neighbouring rural, urban and coastal areas. The Government has yet to announce how Devon’s EU structural funding will be replaced, and officers’ briefing called for any new monitoring and assessment duties for DCC to be accompanied by the necessary Government funding for an “equitable result in terms of funding for Devon and its residents and businesses”. Devon’s funding from Government does not address the “additional costs of service provision and difficulty of delivery in rural areas” it said, and the Government should “support fairer treatment in future funding settlements.

Speaking for the motion Labour group leader Cllr Rob Hannaford said he was content Labour’s motion would guide Devon’s response to Government, but Cllr Atkinson points out ”DCC does not have to wait for Government approval to carry out a rural  impact assessment and I urge DCC to make this a standard part of policy and decision making.”

New care home tragedy on horizon as experts warn UK ‘making same mistake again’

Experts and care home bosses have warned government guidance to discharge Covid hospital patients into care homes is still risky despite vaccines.

[Remember the government and NHS have until 22nd January to file their detailed evidence to rebut Dr Cathy Gardner’s legal challenge. – Owl]

Laura Connor (extract, use link for full story)

Scientists say we could be making the same mistake as last year when the UK recorded 28,186 “excess deaths” in care homes following the discharge of tens of thousands of infected people from hospitals.

The NHS is advising that patients can be moved directly from a hospital to a care home within 90 days of a positive Covid test or the onset of symptoms…..

Simon Jupp asks housing question – the partial answer reveals a great truth

Simon Jupp MP asks pertinent questions concerning the number of housing permissions granted compared to housing starts but doesn’t get a full answer.

The answer he was given indicates that permissions are running ahead of the 300,000 new homes per year target but that the government hasn’t a clue about build-out rates. Yet the Government’s “build, build build” policy assumes that granting permissions is the bottleneck.

Moral – don’t build policies or houses on  shaky foundations.

Nice one Simon!

Housing: Construction: 15 Jan 2021: Hansard Written Answers /wrans/

Photo of Simon JuppSimon Jupp Conservative, East Devon

To ask the Secretary of State for Housing, Communities and Local Government, what his most recent estimate is of the number of housing units with planning permission; and for how many of those work (a) has started on site, (b) is due to start on site and (c) is not yet planned to start.

Photo of Christopher PincherChristopher Pincher Minister of State (Housing, Communities and Local Government)

The latest quarterly National Statistics on planning applications* show that over the past three years 1.14 million housing units were granted planning permission. Planning permissions are typically valid for 3 years before expiry if construction has not commenced. As part of the Government’s ongoing development of the official statistics on housing and planning we are looking at ways to provide more information on the progress of sites with planning permission.

* Source: Table 5