Cornwall Council welcomes £6.5m plug for possible 'financial abyss'
The Government has added an additional £500 million support for local councils for 2024/25
Last updated 25th Jan 2024
Cornwall Council’s deputy leader, who warned last week that local authorities face a "financial abyss", has welcomed news that the Government has added an additional £500 million support for local councils for 2024/25 – which includes an expected £6.5m for Cornwall.
Cllr David Harris, who is also the council’s portfolio holder for resources, issued a stark warning last week in a letter to Michael Gove, the secretary of state for levelling up, housing and communities. He said that without additional funding even well-run councils risk "going to the wall".
He wrote: "I have been portfolio holder for resources since the Conservative Group became the majority party in Cornwall Council in 2021 and I have seen how tightly our finances are run, but I have now almost reached the stage of throwing my hands in the air in despair. Whichever way we turn we see financial issues that are outside of our control."
His letter came at the same time as over 40 MPs wrote to Prime Minister Rishi Sunak urging the Government to provide an emergency injection of funding for councils to prevent major reductions to local services.
In recent months Slough, Croydon, Thurrock, Woking, Birmingham City and Nottingham City have all issued notices effectively declaring themselves bankrupt. Cornwall Council says it’s not in immediate danger of going bankrupt but if things don’t change, it will be on a financial "cliff edge" within two years.
It has been announced that the Government has added an additional £500m to its Local Government Settlement for 2024/25 – the annual figure the Government provides to local authorities like Cornwall Council. The boost to the national figure will see Cornwall Council benefit with an increase of an expected £6.5m.
Cllr Harris said: "I am very pleased that Mr Gove and the Government have listened to the entreaties made by MPs, the Local Government Association and people like me. We obviously welcome the announcement but it’s only a one-off settlement for a year. It still leaves us in deficit, but it means it’s not as bad as it was."
Steve Double, MP for Newquay and St Austell, also welcomed the news. "Along with my Cornish MP colleagues and Cornwall Council’s Cabinet I have been making the case to the Government that they should provide more funding to Cornwall Council during these challenging times.
"Just in the past week I have held a debate in Parliament on this subject, as well as writing to the Prime Minister and Chancellor with my concerns."
He added: "I am delighted that the Government has listed and revised the settlement figures, giving more money to Cornwall Council to help it in delivering essential services such as adult social care and services in rural areas, for the people of our Duchy. In particular I welcome the increase of 15% to the Rural Services Delivery Grant in 2024-25. This should mean approximately an increase of £1.5million to Cornwall Council."
The council needs to make savings of around £75m in the next four years in order to balance the books.