The post-lockdown challenge

By Chris Roberts, Senior Associate and former Leader of the Royal Borough of Greenwich

As Councils emerge into the next phase of the Covid-19 pandemic, there are a number of challenges to meet. Some will view the loosening of restrictions as opportunities to do things differently. A ‘new norm’ brigade is already arguing for less travel, conversion of offices to homes and greater opportunities to work from home.

There will be much to tempt councils into early decisions. As furlough ends, the picture of closed businesses and unemployment will only then become apparent. Councils will need plans to defend and invigorate their town centres, not least because they so often form the bedrock of place and identity for local communities. At the same time, loosening restrictions will bring rising rates of pandemic infections and ongoing challenges as to how to keep care homes stable, schools open after summer and the bins emptied.

Most councils curtail their activities over summer. The best will use this time to think through what they face, both the knowns and the unknowns.

First, councils know that central government will never fully compensate them for costs incurred and loss of income during the pandemic. Councils have lost council tax, rent and parking income which is unlikely to ever be fully recovered. Other income sources, from planning and licensing applications will also have taken a hit.

Second, every council knows that when it comes to paying for the borrowing incurred, local government will take a significant hit. Local authorities remain the only part of the public sector which must, by law, balance its revenue budget every year.

The sector is therefore an extremely attractive target for a chancellor making cuts and comes without the emotional lobbying potential of the NHS, the police, or even of retired generals concerned with the defence of the realm.
Some councils will have already acted swiftly last year by increasing bad debt provision, especially in their housing revenue accounts, to cushion the loss of rental income. There are already demands from some to relax parking charges to aid economic and town centre recovery. This should be resisted. There is enough evidence, from the last opening in autumn to the flood to pubs and restaurants in recent days, to demonstrate there is absolutely no reluctance on the part of the public to get back into shopping and hospitality environments. Councils should protect their cash flow and income streams to give themselves the best chance of assisting others and in recognition of the financial challenges yet to come.

Where there are gaps in the town centre, the greater loss is likely to be as a result of accelerated market trends to online shopping. The better response here is not to try to reverse this King Canute style but to continue the thinking undertaken by many councils already, to understand what the future town centre looks like. With this might come accelerated and amended local plans to capture the emerging changes needed to retain the vitality of the town.

The same will be true of office accommodation. For some councils, there may be the opportunity to rationalise office costs (the largest expenditure after staffing) where this has not been done. For commercial property, increased home working may be the future for some. Having lived through the banking sector’s desire to close local branches, only to reverse course under consumer pressure, I have some doubts about the sustainability of home working in the longer term. The need for human interaction, to read body language in negotiations and have a ‘proper chat’, will, in my view, result in a gradual slide back towards the office. I also doubt whether the confidence exists long term in UK management to lose the sense of command and control which the office environment provides. I certainly would not rush to predict the decline of the office.

Then there are the social consequences of the pandemic. The mental health of young people has been well documented. There is also likely to appear much hidden domestic violence and demands for services in these areas can be expected. So too, in the area of child protection. It is desperately sad but will be all too predictable to anticipate that more children will have been harmed and abused during the last 18 months. Some of the demands on these services will only emerge over time. In cases of abuse, perhaps only in several years time. But, councils need to plan for potential increases in demand for care and protection services in close liaison with local police services. A consequential demand on emergency housing might also be anticipated.
It is the role of councils to prepare for the worst. As restrictions ease and humans interact more closely, there will be rising infections and more deaths, hopefully at a much lower ratio following the vaccination programme. However, another post-summer, flu season lockdown of sorts cannot be ruled out. No one will forgive those who are not prepared for this.

Councils will want to ensure the care homes in their areas are stocked with PPE, with adequate staff rotas and provision for the isolation for those charged with the institutional care of the elderly and vulnerable. There will need to be thoughts about schools in the autumn, university campuses and the licensing of large spectator and audience venues. Each of these, plus a population back foreign summer holidays, have the capacity to provoke a spike in local infections.

The challenges for councils will be substantial and varied. They are likely to require considerable flexibility and nimbleness in a significantly challenging and worsening financial climate. To so many who work tirelessly in local government, often for scant praise or reward, this will sound less like a ‘new norm’ but very much like ‘business as usual’.

Wherever you go this summer, it is likely your local council is thinking through the challenges and threats outlined above, along with many others too numerous to mention. To us, here at Cratus, it serves to confirm our view of the importance of local government to our communities.

When we all return, it will do us well to remember that, in practical terms, Our World is Local.