Bury St Edmunds: St Edmundsbury Borough Council has more than £33million in bank
PUBLISHED: 06:40 17 January 2014 | UPDATED: 06:40 17 January 2014
One of Suffolk’s borough councils is among the richest of its kind in the country, with more than £33million held in the bank.
St Edmundsbury Borough Council has far more investment money than any of the county’s other district authorities and slightly more than Suffolk County Council (SCC), according to figures from the Department for Communities and Local Government. Its total investment money ranks in the top 15% nationally of the country’s 201 non- metropolitan borough councils.
It has £11m more than neighbouring Forest Heath District Council, which has the second biggest pot in Suffolk. Council leaders said the figures were a result of hard work, but critics warned it was important the authority does not “sit on” the cash at a time when families are struggling to pay bills. St Edmundsbury council leader John Griffiths said the funds were there to be used by the community. He added: “We have a track record of prudent investment of public funds that yield excellent returns for our residents. Our capital has allowed us to invest in projects that attract much wider support.
“Building the Apex, for example, was part of a £100m investment that has transformed Bury St Edmunds’ prospects, and our town centre enhancements in Haverhill continue to lever in wider investment.
“The money is there to be used for the community and we work hard to get the maximum benefit from it for our residents.”
At the close of the last financial year, St Edmundsbury had £33.1m in banks and building societies, whereas SCC had £33m split between bank deposits and market funds.
According to each council’s annual accounts, St Edmundsbury had a comprehensive final balance of £8.6m while SCC’s was £114.1m.
Councillor David Nettleton, one of three members of the council’s treasury management committee, said: “Certainly the borough council has tried to manage its money so that it doesn’t get caught short of anything.
“What they’ve tried to do is avoid cutting the basic services. A lot of councils have cut services, but the borough hasn’t really cut anything major.
“Gradually, it’s trying to reduce its expenditure whilst maintaining the level of income.”
Robert Oxley, Campaign director of the TaxPayers’ Alliance said: “Councillors are right to plan for a rainy day, but nor should they sit on piles of residents’ cash at a time when families are struggling to pay the bills.
“St Edmundsbury Borough Council should consider using some of these reserves to cut council tax while ensuring its budget is financially sound.”
The figures come as St Edmundsbury gets ready to plan the sharing of services with Forest Heath following the creation of a single-management system last year.
The cost of redundancies following the restructuring of Forest Heath and St Edmundsbury councils to date is £1.6m. This is a one-off cost starting with the chief executives and senior managers in 2012 /13 and now nearing completion.
St Edmundsbury is also facing a 47% cut in grant funding from central Government.
Some of St Edmundsbury’s funds, which total £34.3m in its statement of accounts due to accounting adjustments, are put into short-term investments so they can earn interest while being available to pay for things like housing benefit.
They are made up of capital costs, such as income from selling its social housing stock, and local taxes.
Some of the investment money is also council tax money due to be passed onto other public bodies. The £33.1m is a £1m increase from last year, but way down on the £46.9m it had invested at the end of 2008/09. As of December 31 the figure was £38.4m.
At a cabinet meeting in December, councillors agreed to appoint external fund managers for the first time in a bid to maximise the council’s investments.
Forest Heath has £22m split between banks and building societies. Suffolk Coastal had the county’s third-largest pot, followed by Ipswich, Waveney, Babergh and Mid Suffolk.
Reserves (in millions)
Forest Heath 22
Mid Suffolk 0.5
St Edmundsbury 33.1
Suffolk Coastal 20.3