Council faces �3million deficit

FINANCE chiefs at one of Suffolk's wealthiest councils have warned they could be more than �3million in the red within three years because of spiralling costs and tumbling revenue.

Laurence Cawley

FINANCE chiefs at one of Suffolk's wealthiest councils have warned they could be more than �3million in the red within three years because of spiralling costs and tumbling revenue.

A raft of savings is already planned next year at St Edmundsbury Borough Council including shedding about �1.2million in staff and service improvements.

But that will still leave the council - rated “excellent” by the Audit Commission - needing to save about �1.7million to balance its books by 2012 - something the authority's leader John Griffiths said was a “daunting” challenge.


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Critics last night called on the council, which has millions of pounds tied up in property, investments and reserves, to stop “wasting money” on private-sector consultants and allowing project costs, such as the forthcoming public venue building in Bury which has ended up costing almost double the original �9million forecast, to run over budget.

Mr Griffiths said the cause of the problems were a mix of rising costs, falling interest rates on investments, falling revenue from services such as building control and less Government funding.

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Mr Griffiths said: “It is a daunting task and it becomes all the more difficult because we've already made a large number of savings. There is always room for improvement and we need to keep on improving whilst protecting the interests of council tax payers.

“We were very proud to have frozen council tax last year and we are determined to keep any council tax rise in the next few years as low as possible.”

Paul Farmer, the council's resources and efficiency portfolio holder, said: “Like all authorities we face the challenge of plummeting interest rates combined with increased costs, but reduced demand for income generating services. We have been working on this since February and are well on the way to closing the gap in time for next year's budget.”

In her report to the council's policy development committee, which meets next week, chief financial officer Liz Watts said the council would also be digging into its reserve funds to help bridge the funding gap as well as looking for other cost savings which might be made in the months ahead.

Derek Redhead, and independent member of the policy development committee, said: “I would say a �3million hole in the budget is a lot of money. I know this shortfall is going to make a difference and it will make it much more difficult - though there are savings that can be made.

“The council needs to stop wasting money on private consultants. Sometimes we need to employ external consultants but sometimes we do not and, given some of the high salaries we pay our officers, we should be able to get that work done by our own people.”

He also accused the council of overspending on schemes such as the public venue and the cinema in Haverhill. “All of us should look upon this as public money - it is not the council's money it is the public's money.”

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