North Yorkshire welcomes extra £10.8m Covid funding but faces huge challenges

This story was published 18 December 2020

We have received an additional £10.8m to tackle the cost pressures of Covid-19 next year as part of a range of measures in the Local Government Funding Settlement for 2021/22, announced yesterday.

calculator and money

However, in this year alone the County Council has spent over £80m extra in response to Covid as it has led on public health, support for care homes and supporting communities through the pandemic.

The Settlement has also provided a welcome Income Guarantee Fund. This sees the Government compensating councils for 75% of the reductions in council tax and business rates income due to the impacts of Covid.

The announcement also set out that councils can increase council tax by up to 2%. But councils who provide social care, like the County Council, can consider increasing council tax by up to a further 3% to reflect the financial challenges of delivering social care.

County Council leader Cllr Carl Les said:  “We are grateful that the Government has recognised that financial pressures will still continue into next year as we respond to the Covid pandemic. 

“We are also really pleased to see that the Government has introduced the Income Guarantee Fund as this is absolutely critical for the finances of the County Council. 

“Nevertheless, we still face significant challenges as we predict there will be a shortfall of funding of £75m over the next three years.”

“We will also have to consider levels of council tax and balance the need to fund essential services through this critical period whilst also recognising the increased pressure that this will put on the tax payers of North Yorkshire at such a difficult time.  

“At some point Government is going to have to confront the longer term funding solution for social care and local tax payers should not be expected to meet the gap as has been the case in recent times.

“The long-term pressures we face, particularly in adult social care and in children’s special educational needs, continue to increase at a rate greater than everybody anticipated and we need a long-term solution to address those pressures.

Cllr Gareth Dadd, Deputy Leader and Executive Member for Finance added: “Though we understand the difficulties Westminster faces in making changes to the financial planning system, we continue to feel aggrieved that residents in this county pay too much council tax particularly in comparison to London.

“We urgently need the Government to address the issue of fairer funding for rural and shire counties which face the largest funding gap and have been historically underfunded and for North Yorkshire’s residents who pay more council tax than their urban counterparts.”