York council says it has been left with a £20m black hole after Chancellor’s spending review

25 Nov 2020 @ 2.59 pm
| News

Chancellor Rishi Sunak today set out his spending plans as the coronavirus crisis continues to devastate the economy.

It comes as the Office for Budget Responsibility (OBR) is forecasting the economy will contract this year by 11.3% – the largest fall in output for more than 300 years.

Mr Sunak told MPs that the government was providing £280 billion this year to get the country through the coronavirus crisis.

But not enough money is coming to City of York Council to stave off a £20 million budget gap, said council leader Keith Aspden.

“Since the very beginning of the pandemic, we have provided critical support for those who have shielded, those struggling on low-incomes and to our local businesses at a time of national crisis, and we continue to do so,” he said.

“At the same time, under difficult circumstances, our staff have maintained frontline services, helped residents and businesses to adapt to the ever-changing national guidance, and have provided a successful local track and trace system where the national system has been unsuccessful.

“This has all been achieved with the burden of unprecedented financial pressures caused by the pandemic and £15 billion of Government funding cuts over the last decade. 

“This year, the Government has provided additional funding to help councils manage the impact of Covid-19, which has been welcome. 

“However, the Government made a promise to give councils everything we need to respond the pandemic, yet despite this, City of York Council continues to face a budget gap of over £20 million.”

Facing difficult decisions

So far the government has given York council £16 million – £12 million in a general Covid grant, as well as enabling the authority to claim back £4 million towards loss of income.

Nationally the government expects to provide local authorities with more than £3 billion to address Covid-19 pressures, including in adult social care.

Ministers said this will help councils maintain care services “while keeping up with rising demand and recovering from the impact of Covid-19”.

But Cllr Aspden disagreed. “Unfortunately, today’s announcement will do little to mitigate the economic impact of the pandemic on our city, as well as provide the necessary funding for all our services which have been so relied upon during this time of national crisis.  

“Whilst we welcome the support to our low income public sector workers and additional adult social care grant, it’s quite clear that local authorities across the UK are now having to contemplate difficult decisions for the months ahead, and in York, this is no different.”