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Tory chiefs under fire over £400million cash reserves
TORY county chiefs have been accused of hoarding reserves. which have reached £400million, while cutting frontline services.
Hampshire chiefs admit there is cash in the coffers to fill the gap left by central government funding cuts.
But they argue it is more prudent to cut council spending than use savings to prop up services.
The county council nearly doubled the sums held in reserves from £214m in 2011 to £419m last March while closing two libraries, three care homes for the elderly and slashing spending on Sure Start children’s centres and buses.
Liberal Democrat opposition group leader Councillor Keith House said: “It is close to immoral that Hampshire is stashing away over £400m of local taxpayers’ cash. I think the reserves are excessive and can’t be justified.
“With the state of the economy, we need to promote jobs, and with very affordable building contracts, now is the time for substantial investment in schools, roads and facilities for the future.”
Local Government minister Eric Pickles has urged councils to spend some of their savings to head off service and job cuts.
However, the county council says nearly half the money is already committed to projects such as road repairs, school building and street lighting.
The cash is held in reserves while the spending is spread over a number of years. The council’s reserves also include cash earmarked for specific purposes such as £22m for settling insurance claims.
A Cabinet report admitted there is £80m available which could be used to bridge the gap in the council budget left by a 10 per cent cut in Government funding in 2014-15.
It went on: “Whilst it is true to say that these reserves could be used to mitigate the loss of Government grant reductions, the county council has decided to make a more sophisticated, long-term approach to the use of these reserves…”
Council leader Cllr Roy Perry said: “If we used reserves simply to prop up the budget, in the short term, they would be exhausted very quickly.”
Cllr Perry said the £400m savings is equal to about £300 per head of population in Hampshire “to meet every possible contingency”. He added the council is proud of its record on savings.
Tory chiefs plan to use savings to modernise and transform services, including care of the elderly and speedier broadband.
Plans also include setting aside £5m for bigger payouts to staff who take voluntary redundancy to reduce the salary bill.
The Cabinet has approved cutting the budget by £86m by 2015 on top of £100m saved over the past two years.
Children’s services, adult social care, economy, transport and the environment are being asked to find savings equal to 12 per cent of their budgets in 2015-16. Hundreds more jobs could go in addition to the 1,700 already shed over the last two years.
Peter Terry, regional organiser for the Unison union, said: “It is unbelievable that the county council has nearly half a billion pounds in savings. The cuts are totally unnecessary.
“The council has the money available to provide services but has made a decision to cut services and jobs to reduce the size of the public sector.”
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