Lead Member for Finance, Cllr John Kaiser writes:
With other local councils getting into financial difficulties, it is important to give our residents in Wokingham Borough, confidence that we are in a strong position and are not at risk.
Recent news that some local authorities (for example Labour-led Slough Council) have had to declare bankruptcy and are finding it impossible to make ends meet and little chance this situation will change for the foreseeable future, residents are naturally concerned that we could go the same way – but the short and simple answer is no.
How is it we are delivering more services and facilities when other councils are closing swimming pools and libraries, we are opening new ones and we are providing better services and facilities such as Bulmershe, Cantley, Dinton Pastures, California Country Park and Lower Earley and Arborfield Green
Too good to be true!!!!
Let me explain how we have done it
In fact, thanks to the Conservative administration's careful budget monitoring, prudent borrowing and shrewd investments, our finances are among the soundest in the land.
Here’s how we are safeguarding our financial future, which is the cornerstone of being able to provide great services.
We regularly monitor and report on expenditure throughout the year to keep a close eye on expenditure, the first thing I did when taking on this role was to insist the budget in all its glory was subject to Overview and scrutiny before it was published in its final format and over a period of 6 months so everybody could have their say. Last year, the budget came in slightly underspent, and even though it’s been a very tough year we are currently on a good track this year.
Chartered Institute of Public Finance and Accountability (CIPFA) in response to general concerns about local authorities’ financial stability and provides a measure (a set of financial indicators) against which we can test our resilience. An independent assessment of all these indicators (by the Municipal Journal) placed us in the top 20 in the country overall last year and, since then, all our key indicators have got even better.
Let me talk about Debt
All local authorities must borrow money if they want to forward fund new things such as leisure centres, regenerated towns, solar farms, and other improvements for the community but even more important to fund infrastructure prior to development this includes new road and schools.
My rules around borrowing money are quite clear that must have a clear route to pay back makes commercial sense and delivers services facilities to residents.
I clearly understand we are not some company or commercial entity but that does not mean we should abandon prudent fiscal controls like as I say some councils seemed to have done.
The money we spend is residents’ money and as such they are our shareholders and more importantly our funders and as such, we must deliver the service and the environment we all want to exist in Wokingham borough.
This means the key is to ensure your borrowing can be funded by the return on the investment and is backed by the assets produced.
In our case, the cost of borrowing is not just off-set by the returns we are making, the Conservative-led Council is generating revenue that can be reinvested in services without which money we could not balance our budget and would have to reduce or cut services.
Our total net debt when you offset our internal borrowing and investment is around £140 m and the interest paid is less than 2% of the council’s total income.
All of which is not only paid by the return on our investments but is forecast to provide an additional in excess of £30 for every council taxpayer in the borough by March next year nearly 3 times more than last year, all of which can be spent on vital services.
In addition, we are looking to reduce our external debt by over a £100m at the same time and this year we have reduced our cost of borrowing by nearly 1%, from 2.46% to 1.48% a massive decrease of nearly 40%.
The biggest threat to the council and the economy as a whole is inflation as we see prices rising in all areas of life we must keep pace and make some tough decisions on pricing the services we provide across the borough which have been relatively low compared with what other councils charge, car parks are a classic case less than 1% of the councils income is raised in such a way when some of our neighbours are raising over 10% of their incomes in car parking charges compare that to our pricing which was last time raised in 2017, some councils even raised prices during the tough last 2 years. That said any increase in fees or charges will be measured and only designed to help the council keep pace with costs.
No doubt our charges will need to respond to the massive increase we are seeing in energy prices, building costs both labour and materials as well as increases cost in care and schooling but even though we are considered to be the most prosperous area of the country we still have poverty and it is our job to ensure the increases fall on those who can best afford to pay as the only option is less services which will fall on the old and the most vulnerable in the borough.
The recent National Audit Office report on the ‘Financial sustainability of local authorities’ shows we have reserves that can cover of our spending power, which is twice the national average.
Auditing of accounts (external scrutiny):
Our external auditors have raised no concerns with regards to our financial soundness. They have also specifically reported positively on our approach to commercial investments which is in stark contrast to local authorities who have had to declare bankruptcy after ignoring warning signs flagged up by their auditors.
Too good to be true ??? don’t take our word for it: Go to the National Audit Office website (nao.org.uk) and search for Financial sustainability of local authorities.
So, all this opposition political rhetoric is just that and bears no resemblance to the true situation and is just mischief making, to forward their political agenda.
They want action on Climate change but vote against a solar farm which generates clean energy and income for the council.
They want affordable homes but vote against additional homes
They want better facilities and services and then vote against the prudent borrowing which helps fund theses services and facilities such as new roads, new schools, and affordable homes
They want lower council tax for vulnerable residents but again vote against it
They did not want the regeneration of Wokingham town centre and voted against it
But now are quick to claim the credit now they see residents using and enjoying the benefits it brings
Can you see the pattern here, claim one thing and do another and if its Conservative lead Initiative and after all it’s only the Conservatives who can do things, vote against it good or bad, and when its successful claim the credit?
At the best political opportunist at the worst total hypocrites how can you trust them with our great borough and your council tax.
They do not have a great reputation when it comes to handling money as we have seen in the past.
The Conservatives are a safe pair of hands delivering services and facilities which are the envy of councils around the land
Wokingham is a great place to live, work and play and Conservatives will keep it that way.
As only we are the only Party which can deliver.