Political row erupts over council's finances

A council is facing a claim that it is effectively bankrupt following a review of its finances.

A study of the financial position of Bedford Borough Council by the Chartered Institute of Public Finance and Accountancy (CIPFA) has highlighted a number of issues.

Opposition leader Henry Vann, a Liberal Democrat, said he had been "told that Bedford Borough Council is in effect bankrupt".

But Conservative group leader Graeme Coombes said "Bedford Council is not bankrupt" and it was "a staggering attempt by... Vann to mislead the public".

Conservative group leader Graeme Coombes insists the council is not bankrupt

The CIPFA review found that the council needed "a robust, credible strategy" to secure its longer-term financial future and that it needed to be "prepared to act boldly and make 'politically unattractive' decisions", reports the Local Democracy Reporting Service.

The report highlighted a projected overspend for the current financial year that could deplete the authority's entire general reserve, and it added that "we believe the council is already in S114 territory".

An S114 means a council's forecast spending exceeds its income, and it cannot meet its financial obligations without drastic measures. It is a formal notice that freezes all non-essential spending.

A spokesperson for the authority said it had "commissioned CIPFA to undertake a review of the council's financial resilience and financial management".

They added that it "reflects a shared commitment from the corporate leadership team and cabinet to ensure the long-term sustainability of the organisation".

The council said the report confirmed it was facing financial challenges, which were "driven by high spending on temporary accommodation and growing pressures in children's services and adult social care".

An improvement plan is being prepared to "return the council to a sustainable position".

Lib Dem group leader Henry Vann says he has been told the authority is "in effect bankrupt"

The authority is under no overall control but its cabinet is made up of nine Conservative members – including the mayor, Tom Wootton – and an Independent.

The report has sparked a political row with the Lib Dems, who are the largest opposition group.

Vann said: "It is deeply sad that, despite our repeated warnings, we now see the Conservative mayor's decisions leading us to this disastrous point."

He added that he "urgently called on the mayor to produce a recovery plan" and "cancel wasteful spending that does not protect residents".

However, Coombes said: "The CIPFA report confirmed the root causes of Bedford's financial situation are not just recent, and stem from over a decade of financial recklessness and poor governance by the previous mayor, in whose cabinet Vann served."

He added that "Vann's fingerprints are all over the current financial predicament and it's Bedford residents who are paying the price".