Lancashire to tell the government why it needs more cash

Lancashire County Council will set out for the government the extent of the pressure on its finances as ministers prepare the nation's spending priorities for the next three years.
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The authority's head of finance told a County Hall cabinet meeting that the council's financial projections - which show a widening budget deficit in the wake of Covid - were based on an assumption that no additional funding would be forthcoming from the government beyond the current financial year.

However, director of finance Neil Kissock said that he hoped that the reality would be different - and that the county council would be making its case for more cash as part of Whitehall's medium-term financial plans, which are currently being developed.

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"We only have certainty around this year's funding - but clearly none of us think that the impacts of Covid are going to stop this financial year, so we are feeding through detailed evidence as part of the [council's] submission for the comprehensive spending review.

Will the government listen to Lancashire's cash call?Will the government listen to Lancashire's cash call?
Will the government listen to Lancashire's cash call?

"We would hope given that as this is a national pressure, there would be additional funding to come from the [process]," Mr. Kissock said.

He added that the authority would also be seeking in future to "capture some of the savings...of the way we've been working over recent months".

Cabinet members heard that the forecast financial gap for the authority by 2023/24 now stands at £79.3m - up from £71.7m in an estimate made just last month.

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Pressures include increasing demand for both adults and children's services, the cost of pay settlements and minimum wage rises - and an expected £30m shortfall in County Hall's share of council tax over the next three years as a result of household hardships anticipated because of the pandemic.

The authority currently has £150m in reserves, which would be sufficient to plug any gaps in the books until midway through to 2023/24 - but the cabinet heard that additional savings will be sought in order create a "sustainable" financial position.

Labour opposition group leader Azhar Ali said he wanted to see "more vocal lobbying of government" so that Lancashire got its "fair share". He said the time had passed for sending "nice letters" to ministers asking for more money.

"There's a lot of potholes and huge drainage issues [in the county] - and people are concerned about what's going to happen to their services.

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"I remember [the then Conservative opposition group] lambasting [the then ruling Labour group] saying we were using up all the reserves and that would be very different under a Conservative administration - [but] it was all one big lie," County Cllr Ali alleged.

However, Conservative county council leader Geoff Driver accused him of being "totally disingenuous".

"You were part of an administration that proudly declared that you wouldn't be able to set a legal budget for 2019/20. So the fact that we've got £150m in reserves [and] got rid of your £200m deficit that you left us is surely something to be proud of.

"We have [also] added significant sums into the county council budget. Clearly, there is a deficit in 2023/24 which we will have plenty of time to resolve and, because of the healthy position of the reserves, we will be able to tackle that in a meaningful, carefully-considered way," County Cllr Driver said.

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County Hall has so far received £65m in central government grants, covering around two thirds of the £100m estimated financial cost of Covid-19 in Lancashire this year alone.

Just over £25m of the authority's pre-planned savings have been delayed by the pandemic, but 94 percent of budget reductions are on track to have been achieved as intended by the end of 2022/23.