Lib Dems slated over ‘financial illiteracy’

Lib Dem Councillors have been slated for their ‘financial illiteracy’ following a meeting of Bath & North East Somerset Council at which councillors debated ways to meet the financial challenge facing the authority.

One of the proposals discussed by councillors at a meeting on Thursday 9th November was bringing forward planned investment in new commercial property to generate new long-term income for the Council.  Alongside this was a proposal to follow the example of other Councils in allowing the authority greater flexibility over how it uses the money gained from property disposals, known as ‘capital receipts’, to fund one-off ‘invest to save’ initiatives and the upfront costs of service transformation.

However these measures, aimed at helping the Council achieve the £49 million worth of savings it needs to find by 2020, were opposed by Lib Dem Councillors.  The opposition from Lib Dem Councillors came despite assurances that these measures would not involve ‘selling the family silver’, and would actually result in an increase the number of revenue-generating assets held by the authority.

The proposals were ultimately passed with the support of Conservative and Independent Councillors.  However, Conservatives accused Lib Dem Councillors for being ‘financially illiterate’ over their opposition to the plans.

B&NES Conservative Leader Councillor Tim Warren said:

“As people are aware, the Council is facing a significant financial challenge as a result of rising demand for care services and the government’s ongoing efforts to reduce the national budget deficit.

“This means we need to think imaginatively about how we make these savings whilst continuing to invest in the services that are important to residents.

“One of the ways we can do this is by providing upfront investment in measures that will deliver long-term savings, or in assets that generate an ongoing income for the Council.

“The measures agreed by councillors on Thursday will therefore give us the flexibility needed to make these sorts of one-off investments that will save money in the long-run and help us become more self-sustainable and less reliant on Government funding.

“This is the opposite ‘selling the family silver’, as we will actually be increasing the number revenue-generating investments held by the Council.   To describe it in this way, as the Lib Dems have done, is I’m afraid simply financially illiterate and unfortunately demonstrates why the Council was left in such financial difficulty by previous Lib Dem administration.”

Commenting on the changes to the way the Council uses its capital receipts, Councillor Charles Gerrish (Cons), the Council’s Cabinet Member for Finance and Efficiency, added:

“What these changes mean is that where the Council disposes of a property it no longer requires, or where an asset is transferred to the Council’s own Property Company, then the proceeds of that sale can be used to fund ‘invest to save’ schemes or the one-off upfront costs of service transformation that deliver long-term savings for the Council.  By transferring assets to the Council’s Property Company it also means we retain ultimate control over the asset.

“This is a sensible approach to meeting the financial challenge the Council faces, so it’s a shame that once again the Lib Dems are opposing these sorts of measures without offering any solutions of their own.”