Cash is being diverted from key council services to pay for Brexit preparations, according to a survey of council chiefs.
Think tank the New Local Government Network (NLGN) found that more than three quarters of chief executives, leaders and council mayors say they have been forced to take money from other services to get ready for Brexit.
The spending is taking place despite central government providing £68m for local authorities to help put preparations in place.
SAVE THE DATE – LATIF NORTH
March 25th, 2020, Manchester
Council treasury investment & borrowing
Adam Lent, director of the NLGN, said: “The survey shows examples of the tenacity of local government, who are putting efforts into preparing local businesses and residents.
“However, the bottom line is that while the nature, timing and true impact of Brexit is unclear, planning remains a vague endeavour, which is sucking energy and resources from our communities.”
The survey found that while only 1.9% of respondents said they have had to divert a lot of resources from other services, 34.5% said the amount was “moderate”, with 42% saying it was “a little”.
A fifth of councils (21%) said they had not had to divert any resources.
Only 5% of council chiefs feel positive about the impact of Brexit on their local economy, with 71% expecting Brexit to have a ‘negative’ or ‘very negative’ impact on development.
The proportion feeling optimistic has fallen by 54% since NLGN first asked the question in March 2018.
However, about three quarters of respondents from social care councils indicated their adult social care (72 per cent) and children’s services (75.4 per cent) are prepared for Brexit.
Earlier this month, a report to London Borough of Camden’s cabinet said that a post-Brexit financial downturn would “likely result in reduced revenues and greater service demand”.
It said: “Furthermore, any impacts on the value of Sterling or on inflation may impact the costs of existing contracts for service delivery”.
An officer’s report to Leeds City Council’s executive board earlier this month said that, “given the ongoing uncertainty as to what Brexit will actually look like, and the limited engagement from contractors to date, there remains a risk that some contractors may struggle to deliver their commitments post-Brexit, or may seek to re-negotiate costs or terms”.
NLGN survey also showed that Brexit uncertainty has already impacted on services.
Almost three quarters (71%) said it has had a negative or very negative effect on economic development and half (51.8%) said the same about adult social care services.
About three quarters of respondents from social care providing councils indicated their adult social care (72 per cent) and children’s services (75.4 per cent) are prepared for Brexit.
In September, the government published its Operation Yellowhammer document outlining assumptions for a no-deal Brexit.
The document said an increase in inflation following exit from the European Union would “significantly impact adult social care providers due to increasing staff and supply costs, and may lead to provider failure…”
It added that there were possible risks from transport or staff disruption, severe winter weather or flu that “cumulatively could stretch resources of providers and local authorities”.
It said that four councils were priority concerns, but did not name them and said the government would be looking at the status of their preparations.
According to the NLGN, councils’ planning efforts are focused on reassuring businesses, with some supporting EU-national staff to remain in the UK and others stockpiling goods.
One council described “endless scenario planning and testing of emergency and business resilience plans”.
However, one respondent said, “Practical acts are difficult [when the] type of exit is not yet known.”
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