Local governments respond to Covid-19

22 May 20

The Covid-19 pandemic is having a huge impact on governments around the world. With many local governments struggling to find the money to continue to provide frontline services at a time when lockdown measures have slashed their revenues, PFF explores how some authorities are reacting to the crisis.


São Paulo, Brazil

The state government will hire 4,500 beds from private hospitals to deal with suspected and confirmed cases of the coronavirus.

“With this measure, São Paulo practically doubles the number of beds available for the care of patients with the coronavirus,” said governor João Doria.

The beds, of which 1,500 will be in intensive care units, will be ready by 11 June at the latest.

They will cost an estimated R$432m (£63m) for the beds and another R$162m (£24m) for clinicians.

State secretary of health José Henrique Germann said São Paulo faces “a worrying scenario of an escalating pandemic”, and the beds will be needed to stop the healthcare system being overwhelmed.

Vienna, Austria

To stimulate the coffee house and restaurant sector, the city government is issuing vouchers worth €25 or €50 to all households in Vienna.

The ‘Vienna Gastro Voucher’ will cost the government €40m, and officials hope the scheme will protect an industry worth €1.4bn and containing about 60,000 jobs in the city.

Even after lockdown measures wear off, the city government expects long-term losses for the sector because of the collapse in tourism.

Auckland, New Zealand

The city council is currently preparing to consult the public on an emergency budget, after it lost hundreds of millions of dollars in revenue, according to mayor Phil Goff.

The budget, due to be adopted at the end of July, includes the postponement of rates paid by residents and businesses affected by Covid-19.

Highly paid employees are being asked to take a pay cut, with salaries higher than $100,000 (about £50,130), $175,000 (£87,700) and $275,000 (£137,800) being reduced by 5%, 7.5% and 10% respectively.

The council is also conducting a “comprehensive review” of its operating model, which will likely involve members of staff being laid off, with changes to begin by the start of August.

“We anticipate that this review will result in a reduction in our permanent workforce, however it is too early to say exactly how many roles will be affected,” said chief executive Stephen Town.


Houses in Auckland, New Zealand

Houses in Auckland, New Zealand

Michigan, United States

Local governments in the state of Michigan are resorting to widespread furloughs of their staff.

According to local newspaper group Advance, mayors and city managers from the state held a conference call to discuss the drastic cuts they are having to make during the pandemic.

Mayor of the city of Westland, William Wild, said he was saving about $250,000 a month after furloughing 137 employees who worked in the city government, the district court and the library.

In Midland, about 28% of the city’s workforce has been affected; in Muskegon, 31%; and in Kalamazoo, 25%.

The National League of Cities, a group set up to advance the interests of US city governments, projects that Covid-19 will cause local governments in Michigan to lose 37% of their revenue.

Hubei, China

An 800-bed base for the prevention, control and treatment of future major epidemics is being built in Hubei province’s capital city of Wuhan, where Covid-19 was first identified.

The 16-storey building is being built by the provincial government and will act as a public hospital in normal times, but will serve as the treatment centre for infectious diseases in the future.

It is expected to be finished in three years.

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