Saturday, 19 March 2011

Guildford wastes £21m whilst cutting services

As we all know, councils across the country are facing cuts at the moment and Guildford is no exception. That's why it's surprising that Guildford Borough Council has left £21 million unspent.

Now, to make this clear, this £21 million comes from section 106 agreements. Section 106 agreements are a system where developers pay the council a certain amount of money for local services and infrastructure as a condition of getting planning permission. So this money is meant to be spent on stuff like a new playground, or a bus stop, or tree planting.

Here's an extract from the Surrey Advertiser article about it:
Lib Dem environment and economy spokesman Will Forster said: “This is nothing short of Tory financial incompetence.
“Money from developers that is meant to be spent by the county council and Surrey’s local borough and district councils to pay for important improvements is being wasted. In the present tough financial climate, this is scandalous.” 
Figures show around £28m has been secured from developers: £6.7m received and spent on improvements, £11m received and sitting in the banks or balance sheets and £10.5m is outstanding. 
Unspent money could end up having to be paid back to developers.
So this is money that doesn't come out of the council's budget and which exists solely to pay for improvements in local communities. Yet it's being wasted.

To be fair to the council, they do say:
"Obtaining and spending the money is not always straightforward however. 
“Quite often the funding is a contribution to the costs of a scheme, so we can only use the money if we have the rest of the funding available. 
“Some money that has been secured through the planning process requires a trigger to release it. For example, with a housing development it may be triggered by a specified number of houses being completed.” 
“And some borough and district councils, which hold the money, want a spending plan in place before they will release it.”
So, there could, in theory, be a reason why all £11 million pounds received is currently unspent - though you'd think they'd want to spend a bit more of it at a time when they're cutting services.

And again, there is some explanation for the £10.5 million that they haven't yet collected from developers.

But I find it odd that, out of £28 million pounds they've secured, they've only spent £6.7 million. There's a reasonable amount of leeway that they could be given but £21 million pounds leeway seems pretty damn excessive. And, just to put this into perspective, here's a gratuitous pie chart:

As you can see, that's a pretty substantial amount left unspent or uncollected. I'd go so far as to say that this goes beyond the excuses they give and straight into wastefulness. Once again the tories prove themselves fiscally incompetent. Huzzah. Oh, no, wait a minute...

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