Eastbourne Borough Council receives exceptional Government funding amid housing emergency

The council has stated that it would receive an extra £6 million from a government loan, but council leader Stephen Holt has said ‘it changes very little’ after it had announced a housing emergency.

Councillor Holt said: “The Government has accepted our request for the exceptional financial support.

“We asked for urgent support because of a social and financial crisis created by rising levels of homelessness and spiralling costs associated with temporary accommodation placements.

“This is a national crisis and Eastbourne Borough Council led the campaign to highlight the threat it poses to the future viability of local councils.

“In Eastbourne we are spending 49p in every pound of council tax we collect on temporary accommodation. The total cost to the council in this year alone is £5 million.”

Cllr Holt confirmed that in response, the Government has agreed to borrowing of £3 million in 2023/24 and £3 million in 2024/25.

He added: “While the funding support is welcome, I’m afraid it changes very little in the scale of savings now required and the very tough decisions we will have to take.

“We have to pay back the borrowing from the government at an added cost and meet the savings targets already identified.

“This means that in order to achieve nearly £5 million in savings over the next financial year, every penny in discretionary council spending is under review.

“Considering we have already saved £6 million over recent years, the scale of the challenge is significant.”

In January, Eastbourne Borough organised a summit for more than 50 councils in Westminster in a joint bid to tackle homelessness and the financial crisis caused by temporary accommodation costs.

“What is abundantly clear to all council leaders, is the system of funding local government is no longer fit for purpose,” Cllr Holt added.

"This has been reaffirmed in the recent report by the LGIU which stated that just 4% of councils have confidence in the sustainability of local government finance.

“And whichever political party wins the next general election, they must undertake a full review and find a sustainable solution. If this isn’t done, it is inevitable that frontline public services will fail and our most vulnerable residents will suffer most.”

Jonathan Carr-West, Chief Executive of the Local Government Information Unit, said: “It’s good to see the Government finally recognising the scale and severity of the financial crisis in local government that so many of us have been warning of for years. This comes only a day after our research revealed that half the councils in England are seriously concerned about their financial viability in the next five years if nothing changes.

We know how desperate these councils were to receive this exceptional support. For them, it is a last-minute reprieve that wards off immediate financial collapse. On that basis it is welcome news. But we should not mistake this for generosity on the part of the Government. They are simply allowing councils to borrow and to sell their own assets. We should not mistake today’s announcement for a sustainable long-term solution to local government funding. Increased debt and selling off the family silver will only get us so far.”