Calls for Government to hand over Lancashire's Tier 3 funding

Lancashire’s 15 council leaders have sent a scathing letter to the government blasting its “apparent disregard” for an agreement to provide the county with financial support for businesses hit by the Tier 3 Covid restrictions which were introduced in the region last month.

The government pledged a £30m package following a week of tortuous negotiations with local authority leaders which eventually saw the county accept the toughest set of measures to combat what were then escalating rates of coronavirus.

The cash was intended to enable district and standalone councils to create discretionary funds to provide assistance to those businesses forced to close under the restrictions – including non-food pubs and soft play centres – as well as others indirectly affected as a result of limited demand.

The letter was addressed to the Prime Minister’s chief strategic advisor Sir Edward Lister, who led the Tier 3 discussions in Lancashire.

It focuses on two issues revealed by the Local Democracy Reporting Service (LDRS) earlier this month – the delay to the delivery of the government cash and the fact that the sum was also expected to cover support payments during the the period of the full nationwide lockdown, which overtook the original Tier 3 restrictions in Lancashire after they had been in operation for three weeks.

That was in spite of the fact that all councils in England received an equivalent amount – of £20 per resident – just to help them mitigate the effects of the current lockdown.

Lancashire County Council’s Conservative leader Geoff Driver said that the region felt “badly done to” – and is now calling for an additional £20m from Whitehall.

“We agreed to £20 per head and then found out everybody else was going to get the same amount when they’ve only had the four weeks of restrictions to cover, whereas we have had seven.

“We have been told that our letter is now with the minister."

The excoriating missive – signed by the region’s 11 Labour and four Conservative leaders – describes the funding discrepancy as “inherently unfair and divisive” and a “breach of the agreement we made with the government”.

It also notes that funding initially expected to cover the period to March 2021 – of either active restrictions or any longer term impact of them once they have ended – is now expected to last for a further full year.

The leaders bemoan the fact that the money was not delivered to the county during the three weeks it was under Tier 3 – and that guidance about how it could be spent appeared only towards the end of that period.

As the LDRS reported at the time, councils then turned to their reserves to make lifeline payments to businesses, as town halls had yet to receive the cash in their own coffers. The government money has since arrived.

The letter also warns that many councils have either fully spent or are fast running out of funds provided to cover the cost of the government’s means-tested £500 self-isolation payment – and demands more cash is provided “as quickly as possible”.

The candid correspondence concludes by claiming that Lancashire’s councils have “delivered on our side of the deal” and adds:

“We ask that you deliver on the trust placed in you by us and our residents and businesses and honour your promise of an equitable financial settlement for Lancashire.”

Lancashire had initially asked to retain £50m in unspent business support grant cash provided to the county earlier in the pandemic – but was refused.

Overall, the county had sought a £58m support package, around £5m of which it wanted on a recurring monthly basis for the duration of any restrictions.

Ultimately, Lancashire received £42m – including a standard £12m payout for investment in test and trace capacity, based on the size of its population. £9m in backdated support for areas under some form of local restrictions since the summer – Preston, Pendle, Burnley, Blackburn and Hyndburn – has also been promised.

The letter was dispatched just days before Lancashire learns the tier into which it will emerge from the current nationwide lockdown.

The LDRS understands that a national “Gold” meeting was chaired by health secretary Matt Hancock on Tuesday evening at which recommendations were made about the tiers that will apply across England.

A higher-level group known as “Covid O” will make the final decision 24 hours later, ahead of the details being announced on Thursday.

Preston City Council leader Matthew Brown said the situation with the Tier 3 funding smacked of an attempt to “renege on a deal which itself was not universally welcomed in Preston”.

He said:

“The self isolation grant funds becoming depleted is also a serious concern. I have consistently said the government must put a decent infrastructure in place so we can keep people safe – otherwise it will be a losing battle."

Chorley Council leader Alistair Bradley said that the government must "deliver on its pledges to Lancashire”.

The Ministry of Housing, Communities and Local Government has been approached for comment.

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