What does the migrant crisis mean for council budgets?

In the face of a large outcry from the UK electorate, David Cameron recently announced that Britain will accept “thousands” of Syrian refugees. Although exact numbers and time-scales remain uncertain, it is clear that the UK's councils will have to house a huge number of new arrivals in coming years.

Local government support

In response to Mr. Cameron’s comments, the Local Government Association (LGA) stated that while councils were willing to assist refugees, the costs of providing help must be covered by central government.

Many of Britain's Local Authorities have already shown willingness to help. Ruth Dombey of Sutton Council told the LGA that her colleagues are doing "preparatory work in the hope that the government...increases the number of refugees accepted by the UK”. In light of statements such as these, questions remain as to how central government will help the helpers.

Aid support

The only indication of financial assistance from Whitehall has come from chancellor George Osborne, who recently suggested that the UK’s £12bn overseas aid budget could be used to help struggling Local Authorities.

Official Development Assistance (ODA) rules allow governments to spend aid budgets on assistance for refugees during the first 12 months after their arrival, but funds must be found elsewhere after this point. Where will local councils turn after the first year?

Continuing costs

Some future costs might be met by seeking support from charities, many of which have reportedly been ‘inundated’ with donations from activists and concerned citizens. Engaging with charities and grass roots organisations could help to ease the potential financial cost of providing shelter to refugees, and could also help individuals from war-torn countries settle into their new society.

However, relying on charities is not a viable long-term solution to the crisis. The British government must construct a multi-year plan to fund and support councils faced with helping large numbers of asylum seekers. Council budgets are already stretched to breaking point, and if Local Authorities don’t know the specifics of the support they’ll receive, it will soon be impossible to produce balanced budgets that safeguard needy refugees and the interests of existing stakeholders.

For more information on how Local Authorities can maintain healthy cash flows, contact Dukes Bailiffs today.