'Piggy bank' now stands at £7.4m
BACK-UP reserves at a cash-strapped council have increased by almost 30 per cent in a year.
Finance bosses at Stoke-on-Trent City Council topped up the authority's so-called "rainy day" fund by more than £1.64 million in 2011/12.
The council now has more than £7.4 million in general reserves, which are not set aside for any specific projects, compared with just over £5.8 million in April 2011.
Officers say the increasing back-up fund is evidence they are balancing the books at a time of crisis.
Ruark HiFi - for lovers of good music and fantastic sound
Headphone offer is our own offer as test for these vouchers - so don't delay offer expires 25/05/13
Terms:
Only with this voucher, choose a set of headphones up to 10% of the units price or add some to it if you want a dearer set
ie Unit for £300 would give you £30 towards headphones of your choice
Contact: 01782 342609
Valid until: Saturday, May 25 2013
But critics want to know why the money is being squirrelled away at the same time as the council oversees budget cuts of £24 million in 2012/13 – following £36 million in cuts a year earlier.
Outspoken Communities Secretary Eric Pickles has dubbed town hall reserves as "piggy banks" and called on council leaders to raid the funds as budgets are squeezed. General reserves dwindled to £4.7 million in 2010 but have been boosted by several contributions.
John Davis, aged 77, of Bentilee, chairman of North Staffordshire Pensioners' Convention, is campaigning against cost-cutting plans to wind down Marrow House care home in Meir Hay.
He said: "We feel they should use some of this rainy day money to help maintain vital services and improve the quality of life for the citizens of Stoke-on-Trent.
"They have stopped elderly and disabled people using their bus passes before 9.30am to save £100,000 but they are also bolstering this reserve fund.
"It's like a squirrel hiding away nuts for winter – but the winter is already here."
Councillor Dave Conway, pictured, leader of the opposition City Independents, said: "They are putting all of this money into this reserve but while the grass is growing, the horse is starving.
"This money is needed now while we are trying to deal with these budget cuts.
"And with the new budget coming soon, I think that there is worse still to come."
The majority of the council's separate £82 million in "earmarked reserves" are set aside for specific projects, including paying ongoing PFI contracts and protecting the Building Schools for the Future project to rebuild city schools.
Councillors approved plans to borrow up to £25 million from the authority's earmarked reserves to cover redundancy payouts and avoid interest costs.
The last wave of 800 redundancies resulted in payments of more than £11 million.
A total of £4.1 million borrowed from the earmarked reserves is outstanding and is due to be paid back this year.
The authority said the reserves top-up follows "prudent financial management".
Peter Bates, assistant director of financial services, said: "The city council has proved its ability to deliver by responding proactively to the challenges faced during 2011/12 by securing savings of £36 million, accelerating the level of repayment of borrowing relating to the redundancy programme, creating new reserves for the future and achieving a balanced budget for the year."
Comments
by mole10
Wednesday, September 26 2012, 2:26PM
“Piggy bank for reserves, or a retirement fund for Officers?”
by Dizzy1960
Wednesday, September 26 2012, 2:12PM
“Balancing the books while making cuts to services and putting funds away for a rainy doesn't seem logical or creditable to me. But it does prove that we've got a perverse Council and a bunch of puppet Councillor's with a manipulative Executive Committee pulling the strings.
Isn't it about time we made a stand for democracy and for the sake of our future generations?”