Norfolk County Council rejects ‘scaremongering’ finance report

Norfolk County Council is facing a cash crisis and its leadership has no idea how to tackle it, its main opposition leader has claimed.

The warning comes after the authority was identified as showing signs of the financial stress which led a similar council to cut virtually all of its spending last month.

Officials at County Hall have today dismissed the findings as “scaremongering” and insist that no concerns have been raised by external auditors.

But Steve Morphew, leader of the main opposition Labour group, said the findings reinforced their fears over the council’s financial situation.

He said: “We’ve been flagging the huge hole in the budget after the next year and the lack of any plan to close the gap that gapes and yawns.

“Norfolk faces a crisis and there is no sign of those in charge having a clue what to do or standing up for us.”

A study by the Bureau of Investigative Journalism, released on Friday, listed Norfolk as one of three county councils where its finances were revealing areas of concern similar to that of the crisis-ridden Northamptonshire County Council.

It stopped all but the most essential, legally required spending in February after admitting it did not have enough money to meet its obligations in the current financial year.

In Norfolk’s case, the Bureau said the council’s usable reserves had halved in the last five years.

It added that government-published data had recorded a budget overspend by the council in each of the last three years, a claim the authority denies.

And it highlighted the decision to halve funding for its children’s centres in budget plans passed last month as an example of the challenges it faces.

Although the authority has admitted it needs to find £125 million of savings by 2021, it insists it has a “robust and prudent strategy” to reform services, reduce costs and raise income.

A spokesman said: “We refute this scaremongering report.Norfolk County Council recently set a balanced budget for 2018-19 based on a deliverable set of plans.

“Our external auditors have found no issues when reviewing the council’s achievement of value for money, and have commented that the council had in place proper arrangements to secure economy, efficiency and effectiveness in its use of resources for the 2016-17 financial year.”

But she added: “Nevertheless, it is essential that the government urgently addresses local authority funding issues as part of the Fair Funding Review to ensure that the vital local services delivered by councils are put on to a secure footing to enable them to be delivered on a sustainable ongoing basis.”

Mr Morphew agreed that government policy was the primary cause of the council’s financial problems.

But he accused the ruling Conservative administration of using “smoke and mirrors” arguments to hide the full scale of the problems that he claims their own party have created.

He added: “The chickens are already coming home to roost and the sky is black with the rest of the flock in transit.”