Fresh emergency spending controls placed on crisis-hit Northamptonshire County Council to stave off £70m budget black hole

The authority has today (Tuesday) issued a second section 114 notice at One Angel Square, limiting the council to only essential spending.

In a letter to councillors, the director Mark McLaughlin has outlined the challenges facing the council including a potential budget shortfall in this current financial year of between £60 million and £70 million.

The first spending controls issued in February related to the 2017/2018 finaicial year, but the latest section 114 notice extends the controls to the 2018/2019 budget.

The measures prohibit councils from entering into any "new spending agreements" except in any extraordinary circumstances.

An extraordinary full council meeting will now be held next month to discuss a set of spending priorities in light of the spending controls.

The decision to issue a section 114 notice was made in discussion with the Government-appointed commissioners.

County council leader Councillor Matthew Golby said: “The financial challenge facing Northamptonshire County Council remains critical and the spending controls we have in place are vital to ensure we are focusing our limited funding on only the most essential services.

“At the meeting next month, we as a council will discuss a set of priorities built around delivering statutory services and services for the most vulnerable in our communities, and this means there will be difficult decisions that have to be made.

“We remain committed to doing everything we can to identify the savings required to reach a more stable financial position whilst ensuring those in our communities at risk of harm are protected.”

The extraordinary full council meeting will take place on Wednesday 1st August at 5.30pm.

A further meeting of the full council will meet later in the month specifically to discuss the Section 114 notice.

Finance commissioner Brian Roberts said: “We are fully supportive of the issuing of this Section 114 which underlines the truly perilous state of Northamptonshire County Council’s finances.

“We have been very clear that we did not arrive in Northamptonshire with additional money and that to put itself on a secure financial footing very difficult decisions will need to be taken. It is clear the time for these decisions is now.

"It will require a determined response from the council to do everything in its power to address this significant financial shortfall, while protecting vulnerable people. We will ensure that such a response is made.

‘All that is required of the council is that it lives within its means, just like every other council. This is harder than it should be given the over-expenditure of recent years but not impossible.”

Andrew Gwynne MP, Labour’s Shadow Communities and Local Government Secretary, said: “This Government has allowed a Tory council to declare itself bankrupt twice in six months.

“Northamptonshire is a perfect storm of local mismanagement and the crushing pressures of austerity.

“Commissioners will have no option but to slash and burn local services but it’s the people of Northamptonshire that will be forced to pay the price for this neglect.

“The Conservatives’ extreme ideology is pushing local government to the brink.

“The next Labour Government will fund councils fairly and deal with the our country’s chronic social care crisis.”