THE coronavirus pandemic will cost Greater Manchester councils £541 million in extra costs and lost income, a town hall leader has said.

Local authorities have already started planning for economic recovery once lockdown measures are lifted, but they are struggling with limited resources.

Sir Richard Leese, leader of Manchester City Council, has already warned Prime Minister Boris Johnson that the pandemic could take a catastrophic toll on the city’s services.

The government has pledged £89 million to help the 10 councils in Greater Manchester, and that could rise further after a further £1.6 billion in new funding was pledged last week.

But Sir Richard says the support is "nowhere near" what is required, and has warned of "devastating" consequences if the losses are not properly covered.

Speaking at a joint briefing with Greater Manchester mayor Andy Burnham, the council leader said: “We have got an aggregate figure for Greater Manchester on additional costs and loss of income from Covid-19, and that is £541 million across the 10 districts.

“The money that’s come in from the government is £89 million. Even if we get the same amount from the additional £1.6 billion that will still only take us to £178 million.

“That is nowhere near that £541 million.”

Greater Manchester authorities have had to find new ways of raising money, namely through commercial opportunities, to fill the gap left by austerity cuts.

They also rely on the dividend from their part-ownership of Manchester Airport but Sir Richard says this will not be forthcoming this year.

And with councils missing out on planning fees and business rates, other services could be cut to plug the shortfall.

He added: “I think there is a real challenge to government, it needs to be local government, the [Greater Manchester] combined authority and 10 districts that are going to drive recovery forward.

“How are we going to do that if we don’t have the resources to do it?”