Council faces £25m budget blackhole amid calls for Government to wipe off coronavirus debt

Josh Salisbury (16 April, 2020)

"We’re hoping that the government will make good on its pledge to look after us,” say council officials

35496Southwark Council leader Peter John

Southwark Council is facing a £25million black hole in its finances over the coronavirus crisis.

According to council leader, Peter John, the local authority is facing the budget shortfall as revenue streams dry up and expenditure rockets on support schemes for businesses and residents.

Officials at the town hall estimate that it will have an approximate £25m funding gap over three months of the coronavirus crisis.

“If things carry on as they are, we will have a £25m funding gap,” said Cllr John. “At the moment we’re hoping that the government will make good on its pledge to look after us.”

The town hall was given £11m in central government funding at the outbreak of this crisis, part of which was made available for a requirement to house rough sleepers.

“But that’s already been used up,” said Cllr John. The collapse of revenue such as rental income and fines have eaten up income which the council might normally use for expenditure.

The council boss has called on the government to cancel local authority debt amid the growing storm facing town hall finances.

The council’s offices on Tooley Street

Such a move has already been approved for hospitals, with King’s College NHS Trust among those having its debts cancelled by the government, following campaigning from MP Helen Hayes.

The unenviable financial picture is among the reasons why Southwark cannot provide a fund to ensure all children in the borough have access to laptops, said Cllr John.

As the News reported last week, Southwark is facing a legal challenge over education provision, as poorer pupils in the borough may not have access to internet or technology for distance learning.

“If there’s something we could do, we would,” he said. “We have as a council invested significant sums of money investing in our school buildings refurbishing them across the borough.

“The issue is that we don’t have funding for it.”

Cllr John added his praise for schools which are providing laptops and tablets for pupils to use, but also said that it should be possible for students to learn with hard copies of worksheets.


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