East Devon District Council has approved a £5 rise in council tax for next year as political slanging matches broke over possible future borrowing proposals to upgrade council homes to tackle the climate emergency.
Daniel Clark www.devonlive.com
Following previous debates by the council’s overview, scrutiny, housing review board and cabinet committees, the proposed 2020/21 budget was almost unanimously supported at Wednesday night’s full council meeting.
The budget proposals will result in a Council Tax Band D amount of £146.78, an increase of £5 a year (3.53%), on last year
Putting forward the budget, Cllr Ian Thomas, portfolio holder for finance, said that it was a balanced budget, while Cllr Ben Ingham, leader of the council, described it as robust, and Cllr Andrew Moulding, leader of the Conservative Group, said he wasn’t suggesting his group vote against the budget because of the implications of not having one.
All councillors other than Cllr Mike Allen voted for the budget, with Cllr Allen stating that the capital investment strategy of the council was not sound.
His comments followed the council having budgeted for £10,000 to be spent on each of its 4,200 council homes, but latest estimates suggesting that between £25,000 and £40,000, if not more, may be needed to ensure all council homes are of the required standard to make them carbon neutral.
Rather than having to spend £42m upgrading the council housing stock to reduce carbon emissions, and £20 million to replace the houses the council has to sell under right-to-buy, it could cost the council between £81 million to £141 million by 2041 as debt they would have to borrow.
He also had put forward a motion which said that the council had no confidence in the future financial plans and that no approval of the 2021/22 budget expenditures shall occur until the Council is presented with an updated budget and forward plan for 2021-2026, but this was defeat by 35 votes to 15.
Cllr Allen added: “The latest estimate per house of upgrades necessary, presented to Cabinet and Overview, is £25,000, while independent estimates from Government suggest that £40,000 may be needed to raise standards to the required levels. So if we add this in to the budget for our 4,200 properties, we will need to spend a further £15,000 to £30,000 per property, so we will have an additional debt of between £63 million and £126 million to factor in.
“This administration is looking at just one year at a time, but for capital spending, you have to look at three years as a minimum. They are not doing the job properly. It is time for them to stop taking short-term measures and that we do not have the confidence of the cabinet in terms of their financial decisions.”
Cllr Moulding added: “These escalating costs could decimate the financial position. We have no confidence in the finances of the council and the future programme is in very serious jeopardy.”
Cllr Phil Twiss added that the motion may have been ‘making a protest’ but was putting the administration on notice that ‘if you haven’t got your house in order next year, we will say we told you so’.
But he added: “The cash potentially spent on adapting the homes in admirable and the proper thing to do, but what about those who don’t live in EDDC housing stock? It is a kneejerk reaction and trendy to jump on the bandwagon. I’m a glad it is trendy and we should carry on with it, but we need a larger conversation and to look at a much bigger picture than throwing cash at our housing estates.”
Cllr Philip Skinner added: “We are trying to ensure the council is robust in its finances which key to the success of the council, and some of the revelations will put the council in a pretty bad place. I am not prepared to stand by and watch this authority borrow millions of pounds for something that they cannot afford to do, climate change or not. We could spend £50,000 on a house and then have to sell under right to buy, so what would we have gained then?
But Cllr Paul Arnott, leader of the East Devon Alliance group, said that as the Conservatives voted for the 2020/21 budget, the issue must be with the 2021/22 budget but there is time for the council to address it. He added: “This has been hijacked by the Conservatives to make a point at the expense of the Independent cabinet and don’t think they deserve it.”
Cllr Eleanor Rylance said that there may be notions of truth in the motion but that it had been ruined by the ‘crass political point scoring in it’, while Cllr Olly Davey said that as the council has declared a climate emergency, it requires action. He said: “We need to do something and we have control over our housing stock. If we decide to improve insulation in the buildings then it is to be commended and if it requires borrowing to do so, then so be it.”
And Cllr Thomas said that he didn’t think the Conservatives understood the HRB papers as the finances produced were ‘a series of models and scenarios as to what sort of sums we would be talking about’.
He said: “The finances were handed over in an excellent state and they are still there and we should be congratulated for looking at putting these sums in as direct steps to take action.
“These figures were possibilities. They are not in the budget or the forward plan. It shows the scale of funds we need and if we chose to invest £105m in our housing stock, we don’t need to find that in the first year.
“We know exactly what we are doing and how we will manage the budget. What makes anyone think we won’t do anything other than produce a balanced budget in 12 months’ time? What is the point of the motion as it doesn’t say anything?”
Cllr Ingham added: “Cllr Allen said he had no confidence in the cabinet and the budget we have just approved. This is fascinating because I believe they don’t understand the budget. This is an idea, not part of a fixed budget, and recognises what we may have to spend.”
Summing up his motion, Cllr Allen said that some councillors had missed the point. He said: “No one is against the climate adaptation strategy but we need to take a look at the whole investment strategy. The financial plans are not thought through beyond the upcoming year.”
But his motion that the council had no confidence in the future financial plans and that no approval of 2021/22 budget expenditures should occur until the full implications to the Housing Revenue Account and General Fund account can be shown to be funded was lost by 35 votes to 15, with the Conservatives voting in favour of it and everyone else against.