News / Politics
‘Huge challenges’ for Bristol as council faces £82m financial hole
Marvin Rees says the Government is failing to keep pace with lost revenues for local authorities as Bristol faces an £82m blackhole.
The city has received £26.4m in two instalments from Whitehall, but the mayor says this fails to even cover the additional costs brought about by the pandemic as he predicted it is likely to take years to recover from the impacts of COVID-19.
“This is the biggest global health challenge in a century,” said Rees, speaking at a press briefing on Wednesday.
is needed now More than ever
“Actions we are taking to stem the spread of the virus are going to contribute to the greatest hit on the economy since the Great Depression. This is going to be a huge challenge for Bristol’s economy, businesses and jobs.”
Marvin Rees says the recovery process is likely to take years. Photo from a pre-lockdown rally, by Ellie Pipe
Outlining the situation facing Bristol City Council, and other already stretched local authorities, the mayor said there are additional costs totalling some £29m to cover vital services, including adult social care, housing and tackling domestic violence and child abuse during lockdown.
On top of that, the council is looking at a financial blackhole of around £82m in lost revenues, with a dramatic drop in council tax payments, parking, business rates and more.
With an estimated 84 per cent of companies unlikely to survive a lockdown of six months, there is no guaranteed “bounce back” and the full financial implications are unlikely to be felt until after Government support packages end.
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Read more: 84 per cent of South West businesses unlikely to cope if lockdown lasts six months
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There are also predictions unemployment could rocket in the wake of the crisis. The unemployment rate in Bristol is currently at around four per cent – approximately 10,000 people – but if the forecast of prominent economists professors David Blanchflower and David Bell comes true, these figures could soar up to 20 per cent.
Highlighting the stark situation, Rees said: “Unemployment never falls evenly – the areas most disadvantaged now will take the biggest hit.”
He revealed the council is looking at drawing on emergency reserves to cope with the financial implications of the pandemic but warned this still has a knock-on effect. He added that Bristol is in a stronger position that many cities.
The mayor called for the Government to be a “more dependable partner”, saying certainty is needed and the ability to plan long-term, with current losses set to “have a direct impact on service provision”.
Bristol, along with Western Gateway and Core City partners, will be making the case for three things from Government:
1. Backing for major infrastructure regeneration programmes, such as building sustainable housing and transport infrastructure, which Rees said will be “fantastic multipliers for the economy” and a chance to get local supply chains working.
2. Support to ensure the survival of city centres and high streets, “economic hubs that stitch our communities together”.
3. A cancellation of local authority debt, equivalent to that announced for the NHS, in order to maintain vital service provision.
Main photo by Ellie Pipe
Read more: Rees: ‘Let’s rebuild a fairer, inclusive and more sustainable economy’
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