Laura Sharman 11 September 2015

Councils issue warning about using cash reserves

Councils issue warning about using cash reserves image

If councils use their cash reserves to plug gaps in government funding, all the money will be spent within three years, warn town hall chiefs.

New analysis by the Local Government Association (LGA) found that if council use their reserves to meet projected shortfalls, there will be nothing left by 2018. This would mean councils would have no money to cover financial risks or make new investments, the LGA said.

Forecasts suggest councils are facing a funding gap of £17.9bn by 2018/19, and hold £17.1bn in reserves.

Cllr Claire Kober, LGA finance spokesman, said: ‘Reserves are designed to help councils manage growing financial risks to local services. Most of this money is essentially a growth fund which councils are using to build new roads and regenerate areas or pay for school places and superfast broadband. What’s left would only cover less than a month’s spending.

‘The size of cuts councils are having to make are simply too big to be plugged by reserves. Spending them in this way would be a gamble with the future of people who rely on council services and would put local areas on the fast-track to financial failure.’

The LGA is calling for longer-term funding settlements to allow councils to plan ahead effectively.

Participatory budgeting image

Participatory budgeting

Evgeny Barkov explains what participatory budgeting means and how it can reveal what citizens need.
SIGN UP
For your free daily news bulletin
Highways jobs

Deputy Chief Executive & s.151 Officer

Wychavon District Council
package to £90k
This is an exceptional career development opportunity, and the perfect role for a talented public service leader with ambition. Worcestershire
Recuriter: Wychavon District Council

Senior Practitioner - Family Support & Protection

Essex County Council
Up to £237 per day + Umbrella
Managing a defined caseload, the social worker is responsible for working effectively with children, young people and families/carers to achieve positive change and improved outcomes. England, Essex, Basildon
Recuriter: Essex County Council

Qualified Social Worker - Family Support & Protection

Essex County Council
Up to £207 per day + Umbrella
Managing a defined caseload, the Social Worker is responsible for working effectively with children, young people & families/carers to achieve positive change and improved outcomes. England, Essex, Basildon
Recuriter: Essex County Council

Qualified Social Worker - Assessment & Intervention Team

Essex County Council
Up to £207 per day + Umbrella
Managing a defined caseload, the Social Worker is responsible for working effectively with children, young people & families/carers to achieve positive change and improved outcomes. England, Essex, Basildon
Recuriter: Essex County Council

Qualified Social Worker - Assessment & Intervention Team

Essex County Council
Up to £207 per day + Umbrella
Family Operations delivers direct provision of services relating to vulnerable children, young people and complex families. England, Essex, Harlow
Recuriter: Essex County Council

Public Property

Latest issue - Public Property News

This issue of Public Property examines how how flexible workspaces can lead the way in regeneration for local authorities, Why local authority intervention is key to successful urban regeneration schemes and if the Government’s challenge of embracing beauty is an opportunity for communities.

The March issue also takes a closer look at Blackburn with Darwen Council's first digital health hub to help people gain control over health and care services.

Register for your free digital issue