Merton Council Reveals £20 Million Coronavirus Budget Gap

Government cash injection doesn't "come close" to covering losses

Merton civic centre

Merton Council is facing a £20 million hole in its budget due to the coronavirus pandemic.

And despite a cash injection from the government, the leader of the council says the support package will not come close to covering the losses faced by councils across London.

An extra £500 million for councils was announced on July 2 – bringing it up to a £3.6 billion total for local authorities across the country.

As of July 5, Merton Council has received £29,318,000 from the government. But Councillor Stephen Alambritis said: “During the course of the pandemic, we’ve worked tirelessly to protect our most vulnerable residents and support those in need. We’ve absorbed the cost of launching new services almost overnight and redirected resources and staff towards the crisis.”

He added that thanks to a loss of income and additional spending, the cash injection will mean that Merton Council is only expected to recover 75% of a 95% income loss. This means the council will be faced with a £20 million budget gap.

“Councils were already at breaking point before Covid-19 and the promised comprehensive support package promised just isn’t being delivered,” said Councillor Alambritis.

“We also have to factor in that we are by no means out of this yet. The risk of a second wave is there, and consumer confidence will take time to return to the high streets. Losses to local budgets are far from over.”

By Tara O'Connor, Local Demcracy Reporter


July 7, 2020