MPs call for extra help as Rotherham faces £40m Covid-19 shortfall

In a letter to Robert Jenrick, Housing, Communities and Local Government Secretary, MPs John Healey and Sarah Champion call for councils to be given additional funding that reflects their extra costs and loss of income as a result of the pandemic.

The MPs praised Rotherham Council for their response to the Covid-19 crisis – coordinating community support for the most vulnerable, making sure employers follow restrictions and distributing grants to businesses.

But they warned that the projected funding shortfall of £40m – which is likely to be an underestimate – would be bound to hit social care.

Other service areas have already been scaled back with Rotherham facing deep cuts to its main grant funding from the government – the council has had to save £200m since 2010, while facing a steep rise in social-care costs.

Mr Healey, Wentworth and Dearne MP, and Ms Champion, Rotherham MP, said: “The council may face a gross shortfall of as much as £40m as a combined result of additional costs related to coronavirus, reduced income – including lower council tax and business rates receipts – and undeliverable savings in the budget.”

The figure was drawn up by the council after the government asked it to submit financial information on the cost impact of Covid-19 from April to July.

The council has received £16.2m of coronavirus emergency grant funding to date.

The MPs said: “We are concerned that, while further funding may focus on additional direct costs – eg purchase of personal protective equipment, additional funding to social care providers - there might be a risk of less funding for other unavoidable financial pressures.

“Over the current and next year, the council needs to reduce its costs by more than £24m.

“Without additional funding from Government, the knock-on ramifications are significant as this will mean a call on Rotherham’s already low levels of reserves in the current year and an even greater burden of social care cost reductions next year.”

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