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Last-ditch rescue plan for council

A DRAMATIC last-ditch effort is underway to prevent Hyndburn Council going bankrupt.

A DRAMATIC last-ditch effort is underway to prevent Hynd-burn Council going bankrupt.

Red-faced council chiefs are drawing up a rescue plan in a desperate bid to avoid being taken over by Government auditors.

The newly formed budget panel, which met for the first time on Tuesday, has ruled nothing out in its attempts to stave off the authority's massive £1.8M debt. And the Observer has learned that redundancies and the introduction of a three-day week may be on the cards for council staff. Even the sale of its Scaitcliffe House headquarters to a private firm, from which the council could lease the building, has been put forward as an option.

Other proposals to fix the cash crisis are thought to include:

  • Capitalising on profits from its partnerships with firms like Barnfield Construction.
  • Selling off assets, such as council-owned land and its share in Globe Enterprises.
  • Cutting back on the delivery of services.
  • Taking back cash allocated for non-essential projects and area councils.
  • A review of senior management.

So far, the cross-party panel claims to have identified a list of options that would reduce the cash deficit to £750,000. But council tax payers will still be forced to dig deep, according to council leader Peter Britcliffe. He said: "This will still equate to a big increase in council tax. The work to deliver further savings must continue. The council virtually went bankrupt last year as expenditure outweighed balances; the task ahead of us is comparable to working a company out of insolvency."

The council has until May to set a balanced budget. Otherwise Government auditors will move in and balance it for them. But Councillor Britcliffe is confident this will not happen.

"That doesn't bear thinking about," he said. "The important point is we are starting to get on top of the problem and we are determined to crack it over the next few weeks. We are going all out to save this council and seriously considering all possible options."

Councillor Jean Battle, opposition Labour group leader, said: "I am hopeful the work being done by the panel and the whole council will reap dividends and that we will close the financial gap and end this financial year with balanced books."

Steve Watson, Hyndburn branch secretary of workers' union Unison - who also attended Tuesday's meeting - said he was willing to work with the panel to "achieve the necessary savings required, while ensuring that the terms and conditions of staff are protected".


Stuart Pike
Deputy editor specialising in politics
Alex Bell
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Jon Macpherson
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