Owl reported this story from the Sidmouth Herald in full yesterday:
East Devon Alliance councillor Cathy Gardner has contacted EDW to clarify the story:
“To my knowledge (as a District Cllr), EDDC has over £80m in debt because it had to borrow money to hold on to its council housing when the conservative government were making councils sell it off. So this is debt for a good & bad reason!
I’m surprised that the ‘politically neutral’ press officers have not added this to their comment to the Herald. I’ve objected to the council proposing to borrow money to invest in commercial property (to generate income), something else forced on them by the conservative government cuts to council grants (now zero).
The relocation from the Knowle is another matter. If re-elected I will continue to push for transparency on costs and to see if any of the Conservative group can ever prove break even.”
EDDC blames the overspend on loans (see last paragraph below) on “the purchase of assets related to service delivery, these being assets required “for recycling and refuse collection”. Are we to believe that it has ALL been spent on waste contracts and NOT on the £10 MILLION on HQ relocation (originally described as “cost neutral”)?
Owl would be interested to see a breakdown of the costs (but bets they will be conveniently avoided under a “commercial confidentiality” clause with the contractor …
“The amount the authority has borrowed has also increased by £3million in just one year.
Experts have warned councils are risking taking on too much debt while others say that councils are simply adapting to plug funding gaps made by Government cuts.
The Chartered Institute of Public Finance and Accountancy says delivery of public services could be put at risk by unsustainable borrowing, after debt among UK local authorities rose to more than £100 billion.
By the end of December, EDDC’s outstanding loans stood at £86.6 million, according to figures from the Ministry of Housing, Communities and Local Government.
This was a four per cent increase compared to a year ago, and one per cent higher than at the end of 2013-14.
All the outstanding loans were long-term advances, which last for more than one year and are used to finance large projects or purchases.
The Chartered Institute says many cash-strapped councils are taking out large loans to buy property, as the rent they collect can be higher than the interest they pay on the loans.
Funding for councils fell by almost half between 2010-11 and 2017-18, according to the National Audit Office.
The government’s Public Works Loan Board was the sole lender to EDDC as of December.
The loan board offers low-interest loans to councils, without requiring them to prove they can afford the repayments.
There is no limit to the amount councils can borrow from it.
Don Peebles, head of policy at the Chartered Institute, said: “With government funding in decline, it is unsurprising councils are having to adapt and find alternatives.
“While councils are borrowing for a wide range of purposes, such as building houses and investing in major infrastructure, one trend which has been concerning is the growth in investment in commercial property – which exposes public finances to new risks.”
A spokeswoman for the MHCLG said: “Councils are responsible for managing their own finances and making the right decisions for the communities they serve – including making appropriate investments.
“Guidance on council investments was updated in April 2018 with new codes that strike the right balance between allowing councils to continue to be innovative while ensuring that taxpayers’ money is properly protected.”
An EDDC spokesman said: “The annual increase in borrowing identified was used to finance the purchase of assets related to service delivery, these being assets required for recycling and refuse collection.”
Independent groups have sprung up all over the south-west – there must be a reason …..
You know it makes sense – and so do an awful lot of other people!
“Land Registry statistics say house prices in East Devon increased by 18.4 per cent in the two-and-a-half-years since the Brexit referendum”
EAST DEVON’S DEVELOPERS REAP THEIR STRATOSPHERIC REWARDS – DOUBLE REGIONAL AND NATIONAL FIGURES
“The growth of house prices since the Brexit referendum has bucked the national and regional trend, statistics show.
In the two-and-a-half years before the UK voted to leave the EU, the average house price went up by 9.1 per cent from £251,778 to £303,162, Land Registry figures show.
In the same time period after the vote, prices went up by 18.4 per cent.
This is in contrast the regional and national picture.
House prices in the South West increased by 17.7 per cent in the two-and-a-half years before the referendum but only grew by 7.7 per cent in the same period after the vote.
This downward trend is matched nationally, where property prices prior to the referendum grew by 19.6 per cent and in the 30 months after, growth fell to 6.1 per cent. …”
A correspondent has sent the following email to EDDC CEO Mark Williams:
Back in 2006 you supported me in a move to show Planners the Al Gore film “The Inconvenient Truth’ about climate change. You allowed staff a half hour of work time on top of their lunch break to enable the departments staff to watch that film. Thank you!
Tonight I was reminded of this event and your support while watching David Attenborough s documentary ‘Climate Chsnge: the Truth’.
What is scary for me is that the film tonight was so similar to that of Gore’s almost 15 years ago. Pleasing in that Attenborough verifies all the fears that Gore postulated then with our increasingly sophisticated technology. But the reality is the same.
In what way have we changed our practices to respond to our pending oblivion on this planet. ? The answer: not enough.”