Many councils are saying they have financial problems and are having to cut budgets. Undoubtedly many are facing a drop income from reductions in planning fees and parking charges. And undoubtedly some are facing increasing pressures on budgets as demand for vital services goes up.
But, for years many of them have been putting money into reserves for a "rainy day." We believe that rainy day has come and some councils have the opportunity to use their reserves to protect services.
Freedom of Information (FOI) requests by UNISON have uncovered that many councils in the East Midlands have relatively large reserves that could be used to help support budget problems in the short term. Councils carry many types of reserve, many of which are earmarked for specific projects. However, the reserves we have focused on are the unallocated reserves, or “General Fund Balance” that is free to be spent on anything.
We believe any second tier council (district or borough council) with more than 10 per cent of its total expenditure in unallocated reserves has enough flexibility to use some of these reserves to support any budget shortfalls for the next few years. See here for the list of reserves of all of the 36 second tier councils in the East Midlands. The report also shows the total expenditure for the council in 2008/09 and shows reserves as a proportion of expenditure. Some have big reserves compared to their total expenditure.
The councils with the green bars are ones where reserves are in excess of 10 per cent of their expenditure. Some councils such as (but not limited to) Ashfield, Derbyshire Dales and South Holland have well over 15 per cent in reserves, while some like Daventry and Melton have over 20 per cent in reserves.
Likewise we believe any first tier council (county or unitary council) with more than 2.5 per cent of its total non schools expenditure in unallocated reserves has enough flexibility to use some reserves to support any budget shortfalls for the next few years. See here for the list of reserves of all of the nine first tier councils in the East Midlands. Unallocated reserves range from £1m to a whopping £39m.
So, as the 45 councils in the region construct their budgets for 2010/11, our research has uncovered around half of them have money in reserves they can use to help support their budget. There is no excuse for these councils to cut services.
But, for years many of them have been putting money into reserves for a "rainy day." We believe that rainy day has come and some councils have the opportunity to use their reserves to protect services.
Freedom of Information (FOI) requests by UNISON have uncovered that many councils in the East Midlands have relatively large reserves that could be used to help support budget problems in the short term. Councils carry many types of reserve, many of which are earmarked for specific projects. However, the reserves we have focused on are the unallocated reserves, or “General Fund Balance” that is free to be spent on anything.
We believe any second tier council (district or borough council) with more than 10 per cent of its total expenditure in unallocated reserves has enough flexibility to use some of these reserves to support any budget shortfalls for the next few years. See here for the list of reserves of all of the 36 second tier councils in the East Midlands. The report also shows the total expenditure for the council in 2008/09 and shows reserves as a proportion of expenditure. Some have big reserves compared to their total expenditure.
The councils with the green bars are ones where reserves are in excess of 10 per cent of their expenditure. Some councils such as (but not limited to) Ashfield, Derbyshire Dales and South Holland have well over 15 per cent in reserves, while some like Daventry and Melton have over 20 per cent in reserves.
Likewise we believe any first tier council (county or unitary council) with more than 2.5 per cent of its total non schools expenditure in unallocated reserves has enough flexibility to use some reserves to support any budget shortfalls for the next few years. See here for the list of reserves of all of the nine first tier councils in the East Midlands. Unallocated reserves range from £1m to a whopping £39m.
So, as the 45 councils in the region construct their budgets for 2010/11, our research has uncovered around half of them have money in reserves they can use to help support their budget. There is no excuse for these councils to cut services.
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