Council's cash reserves plunge from £7m to £76k

The council leader says the authority is working hard to keep its finances afloat

Blackpool Council’s finances are "on the edge", the town’s opposition leader has warned, after new figures showed reserves had dropped to £76,000.

The authority's latest financial report showed cash kept in reserve to cushion against any financial hiccups had plunged from £7m at the end of the last financial year.

Councillor Paul Galley, leader of the Conservative group on the council, said: “These massive overspends are simply not sustainable putting the very existence of Blackpool Council at risk.”

But Council Leader Lynne Williams blamed Tory government cuts over the past 14 years and said the authority was working hard to keep its finances afloat despite massive pressure on services.

'Closely scrutinised'

Mr Galley told the Local Democracy Reporting Service: “The fact that we are predicted to have reserves of just £76,000 against a target of £7m at a time the council owes half a billion with interest payments alone estimated at a staggering £24.4m per year demonstrates the Labour Group are sleepwalking Blackpool Council to the very edge of insolvency.

“This will mean the people of Blackpool will suffer with worse services and increased council tax.

“If the Labour group don’t act soon, within three years Blackpool Council will be bankrupt.”

Ms Williams said councils across the country had made £24.5bn of savings over the last 14 years under the Conservative government, with the figure for Blackpool £219m.

She said: “Demand for services is increasing across the country, since 2019 there has been a real terms increase in cost of 26% for children’s social care, 64% for home to school transport for children with SEND, 18% in adult social care and 77% in homelessness.”

Ms Williams said in this context the council’s finances were "well managed and closely scrutinised".

She added despite the cuts, the council continued to pursue its £2bn investment programme to create jobs, boost tourism and build new homes.

A report to the executive by the council’s director of resources Steve Thompson said plans were in place to achieve the target of restoring working balances to £8m by 31 March 2025.

Last year the council overspent by around £8m on delivering services, but better financial performances in other areas meant it remained within budget.

The authority recently reported it had been forced to write off almost £1.6m of debt with about half of that due to unpaid business rates.