Michael Gove responds to Oadby and Wigston Borough Council …
Levelling Up Minister Michael Gove[1] has said his department will be in talks with Oadby and Wigston Borough Council[2] to discuss its financial position. Mr Gove was contacted by Harborough MP Neil O’Brien who requested intervention into the council’s finances, as he feared the authority was “on track to run out of money”[3].
In a responding letter, Mr Gove thanked the local MP for bringing this to his attention and for “highlighting some of the current risks” surrounding the council’s financial position and future sustainability. He added that his officials will be “engaging with council officers this month to discuss the council’s position, and their plans for reaching a sustainable position”.
Tory MP Mr O’Brien raised concerns to the Levelling Up Minister in a letter last month, which focused on a number of lines from a report from the council’s Section 151 Officer- the person responsible for its financial health. He said the council is on track to use all of its reserves and a banning order on unnecessary spending should be imposed on the council.
According to Mr Gove, government officials have been in contact with Oadby and Wigston Borough Council to arrange a meeting as part of the Levelling Up department’s wider work. The council leader, Liberal Democrat Councillor Samia Haq, said it was “excellent news” the Government are taking an interest in its position after seeking support for a long time.
She added: “It’s important those in Westminster understand how the current funding systems in place aren’t fit for purpose and unfairly hold back boroughs such as Oadby[5] & Wigston[6]. Our size severely constrains our ability to benefit from major funding streams such as the New Homes Bonus and business rates, leaving us with a fraction of the money other councils in the area receive. We look forward to sharing our ideas and receiving feedback on our long-term sustainability plans we’ve put in place to mitigate the continued financial challenges ahead.”
By law, councils are required to have balanced budgets. If councils cannot find a way to do so, section 114 notices are issued which bans all new spending “with the exception of protecting vulnerable people and statutory services and pre-existing commitments.” While an unusual and extreme step, a small number of local authorities have filed these notices in recent history, such as Croydon Borough Council and Thurrock Council.
Anne Court, borough council chief executive, also wrote a letter to Mr Gove in reaction to the local MP’s letter, in order to provide context and “further information around the council’s financial circumstances and unique position in Leicestershire”. She described Mr O’Brien’s letter as a “surprise”. She said: “The Council disputes Mr O’Brien’s comparison with ‘councils which have failed recently, like Croydon and Thurrock’. Oadby and Wigston’s financial sustainability concerns are characterised by low levels of spending power rather than high levels of debt and financial mismanagement.
“The council is taking steps to generate capital receipts, with the objective of this activity to reduce ongoing operational revenue expenditure and deliver economic regeneration and enhancement of community facilities at no/low cost. Examples of this are downsizing the office headquarters and the sale of a former swimming pool site.” Mr Gove’s letter to the local MP concluded with a hand written note from the Levelling Up minister, which read: “It is absolutely right to demand scrutiny of Oadby and Wigston and I will ensure that happens.”
References
- ^ Michael Gove (www.leicestermercury.co.uk)
- ^ Oadby and Wigston Borough Council (www.leicestermercury.co.uk)
- ^ the authority was “on track to run out of money” (www.leicestermercury.co.uk)
- ^ The best schools in Leicester and Leicestershire according to Ofsted in full (www.leicestermercury.co.uk)
- ^ Oadby (www.leicestermercury.co.uk)
- ^ Wigston (www.leicestermercury.co.uk)