Coronavirus: Oxfordshire councils warn financial impact could be £100 million

They've written to the Government saying they will become financially unsustainable after the pandemic.

All six of Oxfordshire's councils are calling on the Housing Secretary for more money - so they can respond to the coronavirus challenge.

They say there has already been a significant financial impact as all local authority's have had to increase services to protect vulnerable residents.

The letter explains how work has been stepped up in Oxfordshire to help re-house homeless people and administer grants to businesses - whilst income streams have been severely damaged by the pandemic.

The councils believe the negative financial impact of the virus this financial year (2020/21) will be close to £100 million for Oxfordshire.

Cllr Susan Brown, Leader of Oxford City Council, said: "We are over a month into Oxford City Council working under emergency arrangements.

"That's seen us delivering food and medication to hundreds of vulnerable residents, renting more than 120 hotel, college and hostel rooms for homeless people to social distance, and facilitating up to £83 million of immediate financial support to Oxford's businesses.

"We followed Government guidance to act fast and decisively to deliver help to the many people in need across the city, rather than worry overly about the cost implications at this stage.
 
"Over the first three months it is costing us an additional £600,000 and that will be money well spent. But, we are also being hit by a sharp drop across many of the Council's normal income streams in our 'Oxford Model' - particularly from our wholly-owned direct services company ODS as its own commercial work has halted, our park and rides which stand empty, and from our retail property portfolio, where some businesses are facing uncertainty and may struggle to pay rents."

She said it wasn't yet clear what the full impact will be for Oxford City Council, but it 'could be in the order of £12 million', which she says the Government assistance package 'doesn't even begin to cover.'

The letter (below) to Rt Hon Robert Jenrick MP has been signed by Cherwell District, Oxford City, Oxfordshire County, West Oxfordshire, South Oxfordshire and the Vale District Council's.

Copies were also sent to our six MP's.

 

Dear [MP]

As Leaders of Oxfordshire's councils, we are writing to update you on our response to the challenge of coronavirus, and on the significant financial impact the situation will have on all of our councils.

While councils have had to make rapid adjustments to support social distancing across our services, help staff who cannot work due to coronavirus and related impacts, and put in place work from home by default, much local government activity in the county continues. 

We have responded swiftly to redeploy staff and create additional capacity and resilience to meet new areas of high demand, in particular taking significant action to protect and support vulnerable individuals during coronavirus.  This includes dedicated customer contact teams proactively contacting those identified as vulnerable by the NHS as being at risk and connecting them into local support services and essential supplies. 

Our work to protect children at risk of abuse and neglect, to support older people and disabled adults who need help with the tasks of daily life, to re-house homeless people with appropriate accommodation and support services, to administer the government's grant and relief schemes to businesses, to collect waste from homes, and to provide public health advice, continue - and in many cases have been stepped up.  We are also working more closely than ever with the community, and have newly established locality-based services to provide support to vulnerable people, to respond to referrals from the NHS, GPs, pharmacies and work with large networks of volunteers to deliver a multitude of supporting activity.

Other services are temporarily closed - leisure facilities, libraries, and waste recycling centres, for example. As the premises continue to need maintaining, and in a number of cases the services are run by private companies, this is of course not cost-free. As is the case for most councils these days, we are not fully funded by government grants or income from taxes, but from revenue generating activities - from car parking, fees and charges, income from rents and services we provide - which fund many of our services. These income streams have all been severely damaged by the coronavirus restrictions and impact on the local economy. For some 

councils in Oxfordshire, the losses faced in income are of greater financial impact than the additional costs being incurred. 

We welcome the actions taken nationally to support the country through the coronavirus outbreak, and that a proportion of this funding has been made available to local government and wider public services, as well as the support set out for individuals, businesses, and voluntary organisations.

However, across a number of areas, from car parks to social care, business support to waste collection and disposal, the financial cost to the public purse of coronavirus will significantly outstrip the currently available funding. 

Thus far, £14.9m has been made available in additional funding to councils in Oxfordshire, and only £0.3m of this to the District and City Councils.  We welcome the announcement of an extra £1.6bn funding to Local Government in England on 18th April and look forward to seeing the allocations as soon as possible.  Looking across our services, supplier spend, and income streams, we currently anticipate that the negative financial impact of the virus in the 2020/21 financial year will be close to £100m in Oxfordshire, with expected knock-on impacts in future years.  A proportionate share of the extra national funding will still leave a significant shortfall for the Oxfordshire councils. 

We urge your help and support in ensuring that there is continuing and further funding to local government to meet our remaining expected significant shortfall as a result of our additional costs and lost income.  Without this support, authorities across Oxfordshire will become financially unsustainable with depleted or no reserves, and for some, the ability to set a legal budget for 2021/22 being unlikely.

We would be happy to discuss this further at your convenience.

With kind regards
                               
Councillor James Mills               Councillor Barry Wood

Councillor Emily Smith               Councillor Susan Cooper

Councillor Susan Brown            Councillor Ian Hudspeth

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