Agenda item

The Chair invited Sarah Pickup (Deputy Chief Executive) to introduce the update.

Sarah picked out headlines from each of the 4 policy areas:

Local government finance. Sarah reiterated the LGA’s position that councils should be fully compensated for additional costs and loss of income as a result of Covid-19. She said that the LGA were continuing to hold meetings with Government officials to set out their position and the latest Government rescue package had addressed some of the issues.

Sarah said that one of the biggest issues for members councils was how leisure centres would be able to operate in a covid-secure way and still remain financially viable. The LGA was lobbying hard on this and officials from MHCLG and DCMS were aware of the problems.

The LGA had commissioned two pieces of work in recent weeks. The first was for LG Futures to develop a model that would see councils fully compensated for lost income. The second was from the Institute for Fiscal Studies to reflect the impacts of covid-19 on councils and which would feed into the Comprehensive Spending Review.

Workforce. Sarah highlighted the regular workforce surveys of councils that have evidenced the impact of COVID-19 across the local government sector. Based on the results of these surveys, the LGA would be working with councils to help them support their employees through the crisis.

Welfare. Sarah highlighted the LGA’s work evidencing the need to maintain the temporary increase in the Local Housing Allowance rate at the 30^th percentile or higher.

EU funding. Sarah highlighted the LGA’s continued calls for the Government to urgently work with councils and combined authorities to ensure the remaining European Social Fund money be allocated quickly to support the national recovery from the pandemic.

Following the introduction there was a discussion during which the following points and queries were raised by members:

·       Members agreed that leisure centres were a major concern for councils. It was pointed out that it would not be financially viable for many councils to take the running of contracted out leisure centres back in-house due to the VAT penalties. It was stated that leisure centres were more than just commercial enterprises – they provided a crucial role in the health and wellbeing of local communities and the Government needed to provide emergency funding, as they had done with the cultural sector, to help councils keep them open. Sarah agreed that this was a serious problem and one which the LGA had consistently been raising with Government. She urged members to include this on their financial returns to MHCLG. She added that the problem was compounded by the fact that the worst hit leisure centres financially were also the ones that were in the most deprived areas of the country. The LGA would be speaking to Public Health England about what could be done to help.

·       Concern was expressed about lost income from commercial property during the pandemic and the fact that the Government was unsympathetic to this. Sarah said that they had made the point to Government consistently (including in the recent PWLB consultation) that for the vast majority of councils, commercial investments were being used for example to regenerate areas and not solely as a means of funding revenue spending. She said that the LGA would continue to emphasise this point.

·       Members from borough councils expressed concern that Government funding for housing rough sleepers was not reaching them and there was a real risk that those people who had been temporarily housed during the crisis would end up back on the streets again. There was a plea for Local Housing Allowance rates to be permanently increased and for funding for more permanent accommodation and wrap around services to be provided. Sarah said she would ask officers to look into the issues around funding in two tier areas.

·       The costs of local outbreak planning were not being taken into consideration by Government and this was absent from the last set of financial returns. Could the LGA ask for this to be included? Sarah said that there was already a question about testing and tracing on the returns.

·       The Government needed to take into account the fact that compared to many other countries, UK local government was reliant upon a small range of funding sources. It was also the only part of the public sector required to balance its budget on an annual basis. Was there scope for relaxing this during the crisis?

·       It was pointed out that the NJC guidelines around workforce were last updated in mid-March but our understanding around risks, particularly in relation to virus transmission in care settings and the clinically vulnerable and extremely vulnerable groups, had moved on since then. This made things very difficult for councils when the NJC was the only source of guidance. Naomi Cooke, Head of Workforce, said that guidance was last updated on 12 June. She set out the criteria by which guidance was produced by the NJC and stressed that it had to be agreed by both the employers and trade unions, but they had endeavoured to issue it as quickly as possible. She added that discussions with the trade unions were ongoing as staff started to physically return to work.

·       Increased home-working for many council staff and remote meetings were seen as a positive outcome of the crisis and this should continue into the future.

·       It was suggested that councils would get reduced income from both council tax and business rates, not just for this year, but in all likelihood, for several years to come. How was the Government addressing this longer-term shift? Sarah said that longer term certainty could only be addressed through the Government’s Spending Review which the LGA would be lobbying hard for.

·       Where had discussions about the fate of the potential £600 million underspend on business support grants got to? Mike Heiser, Senior Adviser, said that the LGA had called on the Government to give councils access to this money but that the Department for Business, Energy and Industrial Strategy (BEIS) didn’t want to close mandatory schemes at this stage. He added that both MHCLG and the Treasury were aware of the position and an announcement was likely in the near future.

·       What work was the LGA doing about forecasting the demand for PPE during a potential second wave of the virus? Sarah said that they were working with organisations such as Association of Directors of Adult Social Services to address potential demand from a second wave.

The Chair concluded by saying that whilst the Government support so far was very welcome, it was clear from the discussion today that there were still many outstanding issues for councils which the Government needed to address. He thanked members for their clear steer to officers and the mandate to continue lobbying Government on these matters.

Decision

Members of the Resources Board noted the update and agreed that the LGA should lobby Government on the issues raised during the discussion.