South Tyneside chiefs say 'substantial amount' of extra cash needed to plug spending holes due to Covid-19

Town hall chiefs have cautiously welcomed more coronavirus funding for councils, but warned a ‘substantial amount’ will be needed to plug spending holes.

South Shields Town Hall
South Shields Town Hall

Ministers have already made two rounds of payouts to local authorities to help deal with the financial impact of COIVD-19.

This has been worth more than £10million to South Tyneside Council, but bosses say they need more than just cash to pull them out of the red and keep them in the black.

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“The financial impact of the pandemic has been significant,” said council leader Iain Malcolm.

“We have seen increased spending pressures in areas such as adult social care as well as significant income loss in areas such as leisure centres, all whilst there has been additional demand for our services.”

He added: “While any extra funding is welcome, it is not enough.

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“A substantial amount is needed to address the severe financial challenges we face as a result of this crisis and, to enable us to plan properly for the medium term, a much longer term settlement is required.”

A national scheme to help English councils has so far seen the borough allocated about £10.3million over two funding rounds.

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The Ministry of Housing, Communities and Local Government announced a third tranche of funding on July 2

The government claims this takes the total amount promised to help councils to £4.3billion.

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As well as compensating for lost income, the latest stage of the scheme will also allow local authorities to spread payments owed to the government over three years instead of one.

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Details of cash allocations due to each council are not yet available, however.

Local Government Secretary Robert Jenrick said: “From supporting the most vulnerable and keeping vital services running to operating local track and trace, council workers have been at the forefront of this great national effort and are the unsung heroes of this pandemic.

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“[This] takes our support for councils during this pandemic to £4.3billion to help meet the immediate pressures councils are facing.

“I know that the loss of revenue from car parks and leisure centres has created huge difficulties, so I am introducing a new scheme to help cover these losses.”

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