Trafford Council’s Labour leader Andrew Western has warned local authorities across the country are at risk of going bankrupt resulting in potentially catastrophic consequences unless central government increases its support package.
As the financial ramifications of the Covid-19 crises hits the council’s already stretched budget, Cllr Western also fears Trafford may never fully recover from the crises unless Boris Johnson addresses the situation immediately.
Trafford Council received £12.9m emergency funding to help deal with the pandemic, however, just twelve weeks on and the estimated cost to the authority is almost three times that amount.
“The economic impact from Covid-19 will have devastating consequences on some communities and businesses if we don’t receive the financial support we were promised,” said Cllr Western.
“At the beginning of the crises the government told us: Do whatever it takes.
“And that’s what we did – we supported the vulnerable, the homeless, we helped businesses, mobilised community hubs, and delivered food and medication to those in need.
“The government must not now do a u-turn – and go back on its pledge – and leave us with more than a £30m financial black hole that could potentially put jobs and critical services risk.
“We cannot let that happen.”
Trafford Council’s Labour administration successfully set a balanced budget before Covid-19 took hold.
However, since the outbreak, the authority has needed to spend much more money on extra services to help those in need, at the same time when its income has drastically fallen.
The council has spent cash finding accommodation for rough sleepers during the lockdown, paid out more than £20m in business grants, and offered council tax breaks.
Cllr Tom Ross, Trafford Council’s Executive Member for Finance and Investment, is also fearful about how the borough will recover without significant financial support.
“There is no question that we are facing a new era of austerity – and tough economic times lay ahead,” said Cllr Ross.
“The reality is that a majority of communities and businesses will not be immune from the financial impact of the coronavirus.
“What is particularly concerning is that we have borne the brunt of 10 years of austerity and have already had our budget from government cut in half.
“If this crisis has proved anything, it is that frontline services need proper investment – and government will need to step up to the mark on this.
“We need the financial support package that we were promised at the start of the health crises – and not just a piecemeal approach to the problem.”