A key meeting on the financial future of Northamptonshire County Council was coloured by a political walk-out, furious debate and questions over who knew what about the authority’s precarious financial position.
The county hall meeting this morning (Thursday) was called to decide the council’s response to a second Section 114 notice issued by chief finance officer Mark McLaughlin on July 24 in which he said that the council would once again not be able to balance its books.
The notice was issued because, while auditing last year’s books, it has become apparent that there is £34m financial black hole that remains unfilled.
It was the second in a series of three meetings into the issue - the first was held last Thursday.
In the tense meeting, councillors voted in favour of implementing an action plan that will see serious restrictions placed on officers’ ability to spend money as well as cuts that will mean the council will meet only its statutory duties.
Areas of council spending that will be examined include the highly contentious departments for children’s services, adult services, museums and libraries as well as staff redundancies, although there are still no firm details about what those cuts might entail.
Those decisions will be made by the ‘transformational task force’ that has been set up to manage the spending priorities.
At today’s meeting, a string of furious members of the public spoke of how they and their families will be personally detrimentally affected by the cuts.
Public speaker Norman Adams - who was later removed from the meeting after shouting out from the public gallery - said: “Will today’s meeting go down in history as the great massacre of Northamptonshire?
“The day when cuts to services were so drastic that clinging, cutting and axing will not do justice to what takes place?”
Conservative Council leader Matt Golby said: “The purpose of this meeting is not to talk about the cuts, it’s about this council’s determination to get to grips with the finances of Northamptonshire County Council and deliver the best possible services we can within the envelope that we have.”
Delivering his report to the council, chief finance officer Mark McLaughlin said: “The county council can’t continue to spend money it doesn’t have.
“The county council has to become sustainable financially.
“Things have changed in the past six months. The council takes financial management much more seriously. For a number of years, low council tax has not been backed-up by budgetary discipline.
“Reserves were used rampantly, the county council used flexible reserves at ten times the rate of comparable authorities.”
Last year’s budget deficit comes largely from Northamptonshire County Council relying on its capital expenditure being used to prop up its revenue spending. Laws prevent money that’s been raised by councils selling buildings or land (capita) from being used for day to day (revenue) spending on things like education and social services because in the long term this is not sustainable.
But more recently the government relaxed these laws to allow local authorities to spend some of their capital receipts on revenue if they could show it was for ‘transformational’ projects. Northamptonshire County Council said that £30.9m of its revenue spending last year was ‘transformational’. That has now been disputed by auditors KPMG which means the authority’s books last year may not be, in fact, balanced.
Liberal Democrat Cllr Chris Stanbra said of the report: “Item 2.5 talks about the 2017/18 budget and people knowingly adopting unachievable savings.
“Who knew? Councillors? Officers? We need to know who knew.”
Cllr Danielle Stone, Labour, said: “I am not getting a sense from the administration that they are seeing the full implications of what they are doing.
“It’s absolutely shameful and alarming and the architects of this situation need to be brought to book.
“Where are they? They need to be made accountable.
“...I mean people locally, but also the Government and our representatives, the seven MPs.
“Why have they never come here to be accountable to the people of the county?
An angry Cllr John McGhee, leader of the labour group on the county council said: “The majority of you lot voted for these decisions. You put your hands in the air and voted for them.”
Cllr Golby said: “We have tried to set new standards. We are trying to be more open and transparent.
“There have been comments about the past but we have got to deal with the present and the future. We’ll keep the focus and determination to move things on.
“Do people need to be brought to book? That’s not what we’re here for. We want to move this county on to a better place.”
Conservative Cllr Victoria Perry is the member with responsibilty for children’s services. She said: “Safeguarding children and young people remains our priority.
“This does not mean wholesale cuts to children’s services.
“We are looking at our contracts. We can run more efficiently.”
Cllr Golby said that the authority was looking at the example of Essex, where there were double the number of children in care but the council runs its children’s services department on half the budget of the same department here in Northamptonshire.
He added: “In terms of flexibility of our capital receipts, KPMG say it’s still open to us but we have got to demonstrate when we use the money in the future we do it properly.
“We are going to meet our statutory requirements.
“WE have raised some very serious concerns about LGSS and now action is being taken.”
Labour councillors walked out of the meeting when spending priorities were debated in the chamber.
The final meeting of three will take place later this month.