Heather Jameson 11 January 2022

Council finances fared better than expected in COVID crisis, says IFS

Council finances fared better than expected in COVID crisis, says IFS image

The cost of COVID for councils has been far less than expected, research from the Institute for Fiscal Studies (IFS) has found.

But while budgets have held up better than expected during the pandemic, local government has been quick to point out this does not mean council finances are in a strong position.

According to the IFS research, conducted on behalf of the Economic and Social Research Council, local authorities have reported that the pandemic increased net spending on non-education services for 2020/21by approximately £7.8bn.

However, official data published last month suggested the increase was just £4.1bn than normal expenditure – far less than expected.

IFS researcher and co-author of the report, Kate Ogden, said the financial position of the sector was ‘not quite as precarious going into this year as is sometimes claimed’.

But she added it was not the case for all councils. ‘Some have been particularly hard hit and faced real financial difficulties.

'And the Government shouldn’t be too sanguine about the longer-run picture for council funding.

‘As our previous work has shown, with rising demands and costs for adults’ and children’s social care in particular, councils will struggle to raise enough themselves via council tax in the coming years, especially in poorer parts of the country,’ she added.

According to the IFS, the discrepancy between the expected added costs and reality is not down to over-exaggerated council forecasts but because councils were asked to estimate increased demand and lower income, but not how much spending would be reduced.

SIGN UP
For your free daily news bulletin
Highways jobs

Senior Social Worker

London Borough of Richmond upon Thames and London Borough of Wandsworth
£46,206 - £55,992
Senior Social Worker
Recuriter: London Borough of Richmond upon Thames and London Borough of Wandsworth

Waste Operations Support Officers

Durham County Council
£29,071 - £32,046
Temporary until 1 June 2029   Refuse and Recycling are looking for 3 Waste Operations Support Officer to work in the South and East of County Durham. Peterlee
Recuriter: Durham County Council

Recovery Worker

Durham County Council
Grade 7 - £31,015 – £34,811 per annum.
Do you want to make a real difference to the lives of people experiencing hoarding and self-neglect behaviours?   As an Agile Recovery Worker within o Durham
Recuriter: Durham County Council

Finance Officer

Durham County Council
Grade 7, £30,024 - £33,699 per annum. Pay award pending.
We are seeking a Finance Officer to join DurhamLearn, where you will play a key role in supporting the financial administration, budget monitoring and Durham
Recuriter: Durham County Council

Social Work Consultant

Durham County Council
Grade 13 - £47,181 - £51,356 (Pay Award Pending)
Do you believe every child deserves to grow up feeling loved, safe, and supported, with a lasting sense of family, belonging, and stability?   Are you Durham
Recuriter: Durham County Council
Linkedin Banner