Covid-19: Local Government Finance

Baroness Altmann Excerpts

Monday 29th June 2020 Lords Chamber

[Lord Greenhalgh]

At the moment, all I can point to is the commitment by the department to ensure that the cost and demand pressures, as well as the income pressures, are covered by a comprehensive plan. In addition to the increase in funding for local authorities, that would obviate the need to change the way that local government is financed for the time being.

[Baroness Altmann (Con) [V]]

My Lords, can my noble friend confirm that the Government will not countenance local authorities becoming bankrupt, particularly in light of the enormous increase in pension deficits that councils will face and the fact that these pension schemes are not covered by the Pension Protection Fund? Members’ pensions would potentially be at risk should there be an insolvency.

[Lord Greenhalgh]

My Lords, there is an absolute commitment to provide support for local councils through this extremely difficult period. My noble friend is right to point out the pressures we face in pension fund deficits, but that was there before the Covid-19 pandemic. Rest assured that there will shortly be an announcement of a comprehensive plan to support all our local authorities through this pandemic.