Michael Burton 23 July 2020

MPs slate ministers over local government funding

MPs have slated ministers for failing to give local government sufficient funding and urged them to ensure a 'clear and timely financial settlement’ in readiness for the next phase of the pandemic.

The House of Commons' Public Accounts Committee (PAC) said ‘central government has not given local authorities the clarity or support they need over long-term funding'.

It said central government ‘promised’ councils they would have the resources they need but many are now facing income shortfalls.

The MPs added that local authorities need clarity now so that they can plan and prioritise future spending.

They wrote: 'This is vital if we are to avoid the situation of local authorities getting into acute financial difficulties and having to issue Section 114 notices imposing spending restrictions.’

The committee said the Ministry of Housing, Communities and Local Government, which monitors councils’ monthly financial returns, needed to work with the Treasury to 'determine a clear and timely financial settlement to support all local authorities through the next phase of the pandemic'.

Chief executive of the Chartered Institute of Finance and Accountancy, Rob Whiteman, said: ‘Local authorities across the country have been among our frontline heroes since the pandemic began, despite having no clarity on how their efforts will be funded.

'We are pleased to see the PAC joining our call for a clear and appropriate financial settlement, which will allow the sector to continue to protect local communities.’

A UK Government spokesperson said: 'As the public would expect, we regularly test our pandemic plans – allowing us to rapidly respond to this unprecedented crisis and protect the NHS.

'It was clear that Coronavirus would affect all areas of the country, that’s why we immediately put in place an unprecedented initial economic support package for jobs and business worth £160bn. The next stage in our economic response will make a further £30bn available to ensure all areas of the UK bounce back.'

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