28.04.20
Councils urge Government for funding clarity as care costs rise
The County Councils Network (CCN) has urged the Government today (Apr 28) to be clearer on the amount of funding individual authorities will receive from the latest £1.6bn of emergency funding. It comes as analysis reveals that the coronavirus is costing almost £1bn extra to care costs.
While the Government has announced further packages of funding for councils to help fund higher service costs, ministers are yet to distinguish how this funding will be distributed to councils. Pressures on stretched social care budgets continue to rise during the crisis and the fear is that the social care sector could receive less resources.
According to new analysis, the 36 county and unitary authorities represented by CCN initially estimate an additional £322m would be needed to meet their escalating care and nursing home costs, with a further £259m for increased services demand and spare beds for virus victims.
An additional £71m has been calculated to recruit carers, £144m for the procurement of Personal Protection Equipment (PPE) and an extra £238m to support the most vulnerable children through the crisis. These figures bring the extra care costs to £937m.
If distribution of funding is drastically altered, county leaders fear their share of additional funding for social care could be lower than initial announcements at the beginning of April.
Overall, it is estimated that the 36 county and unitary authorities face £1.3bn of additional costs caused by coronavirus, on top of a funding deficit of £1.8bn from pre-crisis times that would have needed filling up this year.
To safeguard councils from bankruptcy, the CCN has previously told ministers to underwrite any loss of income and provide short-term financial flexibility.
Cllr David Williams, chairman of the County Councils Network, said:
“The government has stated that the £1.6bn for councils, announced last week, has been provided to respond to the additional service costs faced by local authorities. It is clear from the evidence provided to ministers that social care is adding the most strain to council budgets as we battle the spread of the disease locally.
“If the government changes the distribution of emergency funding it will disproportionately and unfairly impact those councils responsible for adult and children’s social care, reducing the funding available for these vital care services.
“It is inevitable that government will need to provide a comprehensive package of measures to compensate councils for billions in potential lost income. This will require additional resources, but this should be a targeted and tailored response outside of the £1.6bn allocation which is to address additional costs from the virus, and particularly those in life-saving care services and initiatives that will reduce the strain on the NHS.
“Alongside written confirmation that the government will meet additional costs and underwrite income losses, there are a number of other measures that ministers could bring forward to provide short-term financial flexibility, such as a relaxation of borrowing rules so councils can borrow to fund revenue spending and a suspension of section 114 requirements.”