The Prime Minister has pledged to re-examine allocations from Whitehall to help Liverpool and Knowsley tackle the economic fallout of Covid-19, after the city region slammed the support it has received during the crisis.
Communities Secretary Robert Jenrick said at the start of the lockdown that local authorities would be compensated for the money they are paying to support citizens.
But many feel they have not been given enough. Steve Rotheram, metro mayor for the Liverpool City Region, described Government attempts to provide support to local authorities during the pandemic as a “disgrace” during a virtual press conference last week, and said the city region is “down £137m” due to the crisis.
Knowsley Council has a £10m funding gap, while Liverpool City Council reportedly has a £44m funding black hole and officers are considering filing a motion to bring in emergency spending measures.
In Parliament yesterday, Garston and Halewood MP Maria Eagle questioned Boris Johnson on how the Government would address steep funding issues facing councils such as Liverpool and Knowsley.
She said: “Liverpool City Council and Knowsley Borough Council have both received less than half of what they have spent so far, despite having one of the worst outbreaks in the country and already having lost two-thirds of their government funding in the last ten years.
“So, will the Prime Minister now undertake to reimburse them for the full costs of Covid-19 as promised at the start of this outbreak?”
Johnson responded: “As the Right Honourable lady knows we have invested an extra £3.2bn into local councils, but I will take away what she has said about Liverpool City Council and Knowsley Council and I will take it up with the Secretary for Communities and Local Government.”
Cllr Jayne Aston, Knowsley Council’s cabinet member for resources, said in a statement to Place North West: “At the outset of this crisis, local councils were told that the Government would do ‘whatever it takes’ to support us, to support our residents. Sadly, our latest funding allocation doesn’t reflect that promise.
“In Knowsley, we are facing a potential funding black hole of £10m, maybe even more, and after 10 years of austerity we do not have the capacity or reserves to fill that gap ourselves.
“There is no recognition of the actual need here and that simply means that the impact of Covid-19 will potentially be greater for residents in Knowsley, in Liverpool and across the Liverpool City Region. How can that be fair?
“So, I very much hope that the Prime Minister does stick to his promise and takes the time to understand and address the challenges we face in our region.”
Mayor of Liverpool Joe Anderson said: “I welcome the intervention by Maria Eagle to raise the hugely critical issue of the dire financial situation of councils directly with the Prime Minister. The fact is many local authorities have responded magnificently to the Covid-19 pandemic – despite the huge pressures it has put them under.
“Unfortunately, we now know areas of high deprivation have been more adversely affected, and when you factor in the debilitating impact of austerity on frontline services its little wonder such councils are now facing the very real prospect of bankruptcy through no fault of their own.
“The Government promised it would support councils with whatever it takes. We expect the government to honour that commitment.”
A spokesperson for Liverpool City Council added that the council is working to finalise the details of a strategy for releasing the city from lockdown over the coming weeks. The council is in talks with government, business stakeholders and unions on the logistics of a phased implementation, the spokesperson added.
Manchester City Council’s executive published a report last week predicting a three-to-five coronavirus recovery period and mapping out a strategy for maintaining growth and development to bounce back from a £150m loss.