Council budget plan pushes borrowing debt up to £218m

Council budget plan pushes borrowing debt up to £218m

Council budget plan pushes borrowing debt up to £218m

First published in News
Last updated
Ledbury Reporter: Photograph of the Author by , Reporter

HEREFORDSHIRE Council's backing for budget that pushes its borrowing debt up to £218m hinges on "money to burn".

Barring an unprecedented revolt at full council tomorrow (Friday), that budget raises the average council tax bill to  £1,250 and makes £15.4m in service and grant cuts.

The revolt could come over support for the energy from waste (EfW) incinerator - shared with Worcestershire County Council (WCC) - and the £40m it will cost the council over the next three years.

In backing the 2014-15 budget plan, members are, in turn, asked to approve the borrowing of that  £40m over three years to help fund the £165m EfW plant at Hartlebury near Stourport.

Loan costs will be paid by the contract partner Mercia Waste Management until the 2022-23
contract close, leaving an outstanding loan balance of £31m.

Loan repayment costs will continue to be financed from the waste disposal budget until 2040-41.

The plan's associated treasury management strategy estimates council borrowing increasing by £50.8m over 2014/15 pushing the overall debt up from £167.4m to £218.2m. That projected increase includes £11m borrowed over the year for the incinerator.

WCC has already voted the incinerator and its own share of the funding through.

Last month, Herefordshire Council's cabinet authorised “all necessary steps” to be taken in securing £40m from the Public Works Loans Board (PWLB), but the final decision lies with the full council currently tied at 29-29.

Other key elements for budget plan presented tomorrow are:
• A below inflation council tax increase of 1.9% - just short of the 2% referendum trigger - pushing the Band D (average) bill up to £1,251.32
• The council’s need to save £33m by  2016/17 and £15.4m over 2014/15 alone - in addition to the £34m savings required in the previous three financial years.
• A proposed 2014/15 capital programme totalling £85.3m and funded by borrowing (£57.2m), grants (£24.9m) and the capital receipts reserve (£3.2m).

Comments (10)

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4:56pm Mon 3 Feb 14

bobby47 says...

Good grief! And still it goes on. Relentlessly following a path of economic madness that's entirely reliant upon some false fiscal doctrine that proclaims 'borrowing is good'.
Well it ain't bloody good. It's bloody bad and those at the helm of the 'good ship Herefordshire' should hang their heads in shame, acknowledge they are incapable of dealing with this crisis and move over and allow those with brains and some grasp upon straightforward economics to take the helm and lead us all to a better place than the one we are heading toward.
Despite all our obvious problems, despite our fiscally knackered situation, still, even bloody now this Council are funnelling our funds to the wrong places.
The 'suits' within the Council continue to flourish and exploit our vulnerability, Hoople and the other leaches continue to survive and still the Council remains untouched by the new reality, that is, we are bloody broke. We cannot continue like this.
Why is it we have to simply sit back and accept this intolerable situation. Is there one good man or woman in a position of authority who will stand up, say it as it is and rid us of this turbulent Council Cabinet?
Good grief! And still it goes on. Relentlessly following a path of economic madness that's entirely reliant upon some false fiscal doctrine that proclaims 'borrowing is good'. Well it ain't bloody good. It's bloody bad and those at the helm of the 'good ship Herefordshire' should hang their heads in shame, acknowledge they are incapable of dealing with this crisis and move over and allow those with brains and some grasp upon straightforward economics to take the helm and lead us all to a better place than the one we are heading toward. Despite all our obvious problems, despite our fiscally knackered situation, still, even bloody now this Council are funnelling our funds to the wrong places. The 'suits' within the Council continue to flourish and exploit our vulnerability, Hoople and the other leaches continue to survive and still the Council remains untouched by the new reality, that is, we are bloody broke. We cannot continue like this. Why is it we have to simply sit back and accept this intolerable situation. Is there one good man or woman in a position of authority who will stand up, say it as it is and rid us of this turbulent Council Cabinet? bobby47
  • Score: 10

5:09pm Mon 3 Feb 14

megilleland says...

Westminster Council Tax for 2013/14

Band A £453.83
Band B £529.47
Band C £605.10
Band D £680.74
Band E £832.01
Band F £983.29
Band G £1,134.57
Band H £1,361.48

Herefordshire Council Tax for 2013/14

Band A £1,014.50
Band B £1,183.56
Band C £1,352.66
Band D £1,521.74
Band E £1,859.91
Band F £2,198.08
Band G £2,536.23
Band H £3,043.48
Westminster Council Tax for 2013/14 Band A £453.83 Band B £529.47 Band C £605.10 Band D £680.74 Band E £832.01 Band F £983.29 Band G £1,134.57 Band H £1,361.48 Herefordshire Council Tax for 2013/14 Band A £1,014.50 Band B £1,183.56 Band C £1,352.66 Band D £1,521.74 Band E £1,859.91 Band F £2,198.08 Band G £2,536.23 Band H £3,043.48 megilleland
  • Score: 14

5:25pm Mon 3 Feb 14

redyoll says...

And what have got to show for the exorbitantly high Council Tax - the list is endless- but the one that really really fits badly with me are the salaries/pay outs/expenses paid to the more (loosely termed) senior council staff .
And what have got to show for the exorbitantly high Council Tax - the list is endless- but the one that really really fits badly with me are the salaries/pay outs/expenses paid to the more (loosely termed) senior council staff . redyoll
  • Score: 9

6:06pm Mon 3 Feb 14

WYSIATI says...

megilleland - that's a really useful post.

Here's a comparison to chew on:

One of these councils has 21 people paid more than 100k a year, the other has 4 - so redyoll you're right, clearly a lot of waste there. Same council has another 35 people paid between £76k and £99k, the other has 9.

Fair enough perhaps, the one paying all that extra has a bigger budget - about 50% bigger.

My guess is that Westminster has a small area, no rural roads, schools, or waste services to provide, huge parking receipts, I would expect Hereford has more old people - I don't know anyone who's chosen to retire to Westminster. The difference in council tax may demonstrate what Jesse apparently keeps arguing - dispersed rural counties have too little income and too high costs.

Anyone interested in a nice high paying job might want to head to the smoke
megilleland - that's a really useful post. Here's a comparison to chew on: One of these councils has 21 people paid more than 100k a year, the other has 4 - so redyoll you're right, clearly a lot of waste there. Same council has another 35 people paid between £76k and £99k, the other has 9. Fair enough perhaps, the one paying all that extra has a bigger budget - about 50% bigger. My guess is that Westminster has a small area, no rural roads, schools, or waste services to provide, huge parking receipts, I would expect Hereford has more old people - I don't know anyone who's chosen to retire to Westminster. The difference in council tax may demonstrate what Jesse apparently keeps arguing - dispersed rural counties have too little income and too high costs. Anyone interested in a nice high paying job might want to head to the smoke WYSIATI
  • Score: 2

8:13pm Mon 3 Feb 14

megilleland says...

Approximately 20 per cent of all ‘Band H’ properties in England are in South Westminster, Kensington and Chelsea.
Approximately 20 per cent of all ‘Band H’ properties in England are in South Westminster, Kensington and Chelsea. megilleland
  • Score: 6

8:22pm Mon 3 Feb 14

megilleland says...

"The plan's associated treasury management strategy estimates council borrowing increasing by £50.8m over 2014/15 pushing the overall debt up from £167.4m to £218.2m. That projected increase includes £11m borrowed over the year for the incinerator.

Only a 30% increase!
"The plan's associated treasury management strategy estimates council borrowing increasing by £50.8m over 2014/15 pushing the overall debt up from £167.4m to £218.2m. That projected increase includes £11m borrowed over the year for the incinerator. Only a 30% increase! megilleland
  • Score: 11

11:05pm Mon 3 Feb 14

Mr.Herefordian says...

Well the budget will be voted on on Friday, Brockington 10am which includes a vote on increasing the council tax. We have less services, less of a workforce and there are those who have had no wage or pension increases and are not on benefits who will have to pay extra. I predict that this increase will be voted through but as I am sure you all will attend you may make a difference to those who can afford the increase and vote for it.
Well the budget will be voted on on Friday, Brockington 10am which includes a vote on increasing the council tax. We have less services, less of a workforce and there are those who have had no wage or pension increases and are not on benefits who will have to pay extra. I predict that this increase will be voted through but as I am sure you all will attend you may make a difference to those who can afford the increase and vote for it. Mr.Herefordian
  • Score: -1

1:49pm Tue 4 Feb 14

Herefordian07 says...

The concern here is that we pour rate paying souls will be left with this debt for decades to come, whilst having our council tax increased to squeeze yet more funds out of us to help fund this madness, during this time the Decision makers will have skipped off over the hill with a bag full of rubies in blissful retirement chortling all the way.
The concern here is that we pour rate paying souls will be left with this debt for decades to come, whilst having our council tax increased to squeeze yet more funds out of us to help fund this madness, during this time the Decision makers will have skipped off over the hill with a bag full of rubies in blissful retirement chortling all the way. Herefordian07
  • Score: 6

7:10pm Thu 6 Feb 14

silashayes says...

I thought Hereford Futures was no more? Obviously not if they're still costing us a fortune!
The total amount of money available to Hereford Futures from 2013/2014 are £153,000 funded from Herefordshire Councils annual budget (2013/14 only)

£211,000 funded from surplus rental income from properties purchased using Advantage West Midlands funding

£331,000 funded through the Council Capital Programme supporting investment in Hereford City regeneration

Whilst all of the above funding is available to Hereford futures only part of it will be used to meet obligations to its staff the balance being used for operation costs and to fund delivery project work.

??
I thought Hereford Futures was no more? Obviously not if they're still costing us a fortune! The total amount of money available to Hereford Futures from 2013/2014 are £153,000 funded from Herefordshire Councils annual budget (2013/14 only) £211,000 funded from surplus rental income from properties purchased using Advantage West Midlands funding £331,000 funded through the Council Capital Programme supporting investment in Hereford City regeneration Whilst all of the above funding is available to Hereford futures only part of it will be used to meet obligations to its staff the balance being used for operation costs and to fund delivery project work. ?? silashayes
  • Score: 2

8:58am Fri 7 Feb 14

Herefordian07 says...

The Council and Hereford Futures are so intertwined that it is like Ernie Wise's wig - You cannot see the join! If you listen carefully you might hear the whistle of the oncoming Gravy Train, it has just been refilled to the brim with the next budget of slop for the greedy top echelons to gorge on.
The Council and Hereford Futures are so intertwined that it is like Ernie Wise's wig - You cannot see the join! If you listen carefully you might hear the whistle of the oncoming Gravy Train, it has just been refilled to the brim with the next budget of slop for the greedy top echelons to gorge on. Herefordian07
  • Score: 4

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