£164m hole for Leeds council finances as lockdown continues to bite
Leeds City Council is facing a £164m ‘hole’ in its funding, due to the ongoing impacts of the coronavirus lockdown.
The revelation was made by council leader Judith Blake, who this week repeated the call to national government to underwrite extra spending and loss of earnings faced by local authorities.
Unlike other areas of the public sector, such as the NHS and national government, councils have a legal obligation to balance their budgets each year.
Coun Blake claims the uncertainty from national government around whether or not it would underwrite councils’ losses makes decision-making difficult for local authorities, and claims all political parties want more clarity on how the government will help.
Coun Blake told an online press conference: “Our concern remains high, along with other local authorities around the country. We are asked to put in regular returns and there is a deadline for the next set ot
“We are looking at a situation where Leeds alone is looking at a hole of £164m – we have had £43m come in [from central government] so far, so you can see there is a massive gap.
“Ministers made it very clear from the beginning that we needed to do what needed to be done to keep services working. We are all working to make sure they are held to account.
“We are asking not just for an indefinite series of money coming out, but also an underwriting of the losses we are making. One of the areas we are concerned about is that they are not taking into account the loss of income we are making.
“This is a cross party call from all members of local government, asking government to give us the certainty to allow us to go forward and give us the services that people rely and depend on.
“This is real and it’s serious, and the government needs to make it clear that they will be supporting us.”
The authority’s chief executive Tom Riordan outlined the importance of councils having to balance their budgets each year, adding: “If a council got to the point where they know they are not going to have enough money for the budget, they would have to declare that, and that would put in some extremely stringent measures that would impact services in the city.”
Coun Blake then added that local government secretary Robert Jenrick tweeted this week that Boris Johnson was going to announce another £600m for adult social care.