Ipswich council faces £7.1million deficit caused by Covid-19

David Ellesmere, Labour leader of Ipswich Borough Council. Picture: CHARLOTTE BOND

David Ellesmere, Labour leader of Ipswich Borough Council. Picture: CHARLOTTE BOND - Credit: Charlotte Bond

Ipswich council faces a £7.1million deficit caused by the coronavirus pandemic - larger than any other local authority in Suffolk.

How Ipswich has been hit financially by the Covid-19 pandemic. Picture: SUFFOLK PUBLIC SECTOR LEADERS

How Ipswich has been hit financially by the Covid-19 pandemic. Picture: SUFFOLK PUBLIC SECTOR LEADERS - Credit: Archant

Research by finance directors of Suffolk councils shows that while other districts have lost between £1.1m and £4m, Ipswich has been hit harder - even though East Suffolk and West Suffolk council are each twice the size of Ipswich.

Even Suffolk County Council’s deficit is smaller, at £5.5m.

Ipswich council’s Labour leader, David Ellesmere, said: “At the start the government was giving support to authorities based only on headcount.

“It didn’t take any account of the level of deprivation that were found in local authorities – which meant that urban authorities like Ipswich missed out.

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“And a lot of the money was given to authorities that have social care responsibilities – like the county council – at the start of the pandemic.”

The figures were drawn up by council finance officers for the Suffolk public sector leaders’ group.

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Mr Ellesmere said another reason for the borough’s financial problems was it was losing income from sources like car parks, leisure facilities and commercial property like IP-City Centre.

However, its property company - Ipswich Borough Assets - has kept money coming in.

He said: “IBA has done very good due diligence on the properties it has bought.

“Without the £3.5m it brings in every year we would be a worse position.”

MORE: Ipswich Borough Assets buys Peterborough business park

Ipswich’s Conservative MP Tom Hunt said it was important that government support should recognise the problems of deprivation found in Ipswich when offering support.

“I would support the borough in making that case,” he said.

However, he added it was important that local authorities should ensure their investments were wise and safe.

In other parts of the country, councils got into serious financial trouble by over-borrowing in a bid to earn investment income. He said it was important Ipswich did not fall into that trap.

“I’m not sure it was such a great idea to buy a large office development in Peterborough just as people started working at home at the start of the first lockdown,” Mr Hunt added.

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