Families face higher bills to run key services in Tyne and Wear after pandemic, warns fire chief
Families could be squeezed for extra cash to run key services after the pandemic, fire chiefs have warned.
Like all UK fire brigades, Tyne and Wear Fire and Rescue Service (TWFRS) is dependent on a range of funding streams to balance the books, which have been hit by the covid outbreak.
But while funding from council tax bills has held up better than expected, many are bracing for a fall in income from business rates, especially as companies either shut down or opt to downsize to reduce costs.
The Government has made short-term promises to cover the shortfall for fire authorities, but future years could see burdens shifted on to households.
“The economy is recovering, but there’s still a view on how local government will be funded if business rates don’t recover,” said Dennis Napier, strategic finance manager at TWFRS.
“[If business rates collections don’t recover] at one point council tax or government funding or both will have to increase to make up the shortfall.
“This is why the government’s Comprehensive Spending Review (CSR) is so important, to give us an assurance that should things recover the way they do, there will be adequate funding.”
Napier was speaking at a meeting of the Tyne and Wear Fire and Rescue Authority’s Governance Committee on May 24, the first time the authority or any of its panels has met in person for more than a year.
Lost revenue from council tax and business rates saw fire chiefs forced to raid savings in February 2021 to balance the budget for 2021/22.
It is expected that at least part of this will be recovered thanks to a government promise of compensation worth up to 75 per cent of council tax and business rates income lost as a result of the pandemic the previous year (2020/21).
TWFRS has also been allocated £872,000 for this year (2021/22) to cover expected falls in receipts.
But the brigade has also set up a special ‘Medium Term Planning Reserve’ to ‘safeguard against’ future changes to government funding models after 2022, especially in light of plans for more ‘self-funding’ from sources such as council tax.
Tom Woodwark, a Liberal Democrat member of the authority, said finance chiefs were being forced to make ‘best guesses’ due to a lack of clarity from ministers.