'Bitter disappointment' for Luton campaigners as government rejects 10,000-strong petition for £50m emergency funding

The petition was organised by community activist Fiona Martin after Luton Borough Council suffered "devastating" financial losses due to Covid-19, with a complete loss of dividends from its airport company.

On Tuesday, July 14, councillors approved an emergency budget which will lead to £22m cuts to services in Luton and over 350 job losses.

Responding to the petition, Minister of State for Local Government, Simon Clarke MP said that a £3.7billion grant had been made available to support local councils - out of which Luton Borough Council has received £14.3million.

This came on top of a £9million increase in core spending power this financial year before emergency funding.

The town's two MPs, council leader Cllr Hazel Simmons, and petition organiser Ms Martin have shared their disappointment following the response.

MP for Luton South, Rachel Hopkins said: "The government’s financial support barely scratches the surface of the funding shortfall caused by the Covid-19 impact on Luton Airport.

"Local people should not be punished for a global health pandemic, especially after the government stated that it would do 'whatever is necessary' to support local councils."

Elsewhere, Luton North MP Sarah Owen said that the town had been left "to fight this pandemic on our own" and she criticised the government's refusal to extend furlough for airline workers.

She added: "When our council loses a large portion of its revenue from the collapse in the number of passengers at the airport, all [the government] can offer is more hot air as essential local services are slashed and the jobs of social care workers, library staff and refuse collectors are lost.”

In the full government response, Mr Clarke stated: "The government recognises the additional costs and pressures on finances councils are facing as a result of the current Covid-19 crisis.

"We have made available a £4.3billion package of support for expenditure pressures, including £3.7billion of un-ringfenced grants and the £600m Infection Control Fund.

"Of this £3.7 billion, Luton Borough Council has received £13.4million, on top of a £9million increase in core spending power this financial year even before emergency funding.

"As part of the Secretary of State’s recent announcement, we also confirmed that we will extend the period over which councils must manage shortfalls in local tax income relating to 2020-21, from one to three years.

"We will announce further details of how we will support local authorities to manage tax losses at the comprehensive spending review later in the year.

"The Government also announced a further component of its comprehensive approach to support councils in addressing their income losses will be a co-payment scheme to cover irrecoverable sales, fees and charges income in 2020/21. The scheme compensates for irrecoverable income losses experienced by local authorities above the level they could have been expected to plan for.

"The scheme applies to income which is defined as a sale, fee or a charge and is attached to local service delivery – for example, car parking income or receipts from owned cultural assets. The scheme will not compensate for lost commercial investment income; this is because commercial income losses are more complicated in nature, and government recognises that there are a complex set of variables relating to commercial income sources including recoverability.

"We recognise that some councils with strategic investments, such as airports, are put in an exceptional position by this crisis. We will continue to work closely with Luton Borough Council to help them navigate through what is undoubtedly a difficult situation, as they support their communities through this national emergency."