Brighton Council Write off £51m Debt!
Discussion
As part of the agreement to sell the i360 Viewing Pod
https://www.bbc.co.uk/news/articles/cwypjyyng7wo
I wonder if part of the debt owed to the government by the council (£32m) will be added on to the council tax
https://www.bbc.co.uk/news/articles/cwypjyyng7wo
I wonder if part of the debt owed to the government by the council (£32m) will be added on to the council tax
How do councils get away with wasting millions of tax payers money on these vanity projects with zero controls or accountability on how they spend this money.
It's like giving someone a credit card with zero limit and expecting them not to just piss it up the wall.
"Oh, it is OK, we will just increase the council tax"
It's like giving someone a credit card with zero limit and expecting them not to just piss it up the wall.
"Oh, it is OK, we will just increase the council tax"
Oakey said:
109 staff? Wtf do they do? Are they all underneath turning it manually?
It doesn't spin, it just goes up and down. At the bottom it sinks into a giant hole and passengers are let out then it rises to board the next batch at ground level. Exiting at the lower level I was slightly discomforted to see that that whole shebang appears to be hauled up by a single wire rope attached to an electric winch. No doubt it is safe with many safety features but...I think most of the employees are in marketing bombarding previous bookers with emails to try various novel events they have dreamt up.
ThingsBehindTheSun said:
How do councils get away with wasting millions of tax payers money on these vanity projects with zero controls or accountability on how they spend this money.
Its very simple - most people can't be bothered to vote in council elections, so the majority people who do generally are happy with the status quo, including the waste, which is why the councils don't change that much.If people turned out in large enough numbers to protest vote, we'd get rid of these financially illiterate councils very quickly, and put the fear of God into every council lest they also get booted out, only none of that happens, because too many (and sadly I include myself) just can't be arsed.
ThingsBehindTheSun said:
How do councils get away with wasting millions of tax payers money on these vanity projects with zero controls or accountability on how they spend this money.
It's like giving someone a credit card with zero limit and expecting them not to just piss it up the wall.
"Oh, it is OK, we will just increase the council tax"
It's largely because voters don't hold them to account. Most people don't know what the council is for, what services it is obliged to provide, how it is funded let alone what the policies and track record of its councillors are.It's like giving someone a credit card with zero limit and expecting them not to just piss it up the wall.
"Oh, it is OK, we will just increase the council tax"
Wot IanH755 said, in fact.
Edited by ATG on Friday 14th March 12:25
£51M? What a bunch of amateurs. Woking council were paying over £1M/day in interest payment's on thier £2Bn debt.
I get the above point about voters not turning out, but it amazes me that there's not some kind of central government oversight and rules on what they're allowed to spend thier money on.
I get the above point about voters not turning out, but it amazes me that there's not some kind of central government oversight and rules on what they're allowed to spend thier money on.
Agreed
The level of ignorance around how local government (and government in general) works in the UK is pretty shocking.
Anotrher factor is that councils themselves have relatively little control over their own income levels. Most of their income comes from central government grants. Consequently, they sometimes try to engage in activities to generate income outside of the normal sources (rates, council tax etc) and there is now a generational ignorance in councils in how to manage their own affairs, as they barely know how to control them.
The level of ignorance around how local government (and government in general) works in the UK is pretty shocking.
Anotrher factor is that councils themselves have relatively little control over their own income levels. Most of their income comes from central government grants. Consequently, they sometimes try to engage in activities to generate income outside of the normal sources (rates, council tax etc) and there is now a generational ignorance in councils in how to manage their own affairs, as they barely know how to control them.
RizzoTheRat said:
£51M? What a bunch of amateurs. Woking council were paying over £1M/day in interest payment's on thier £2Bn debt.
I get the above point about voters not turning out, but it amazes me that there's not some kind of central government oversight and rules on what they're allowed to spend thier money on.
There used to be this thing called The Audit Commission and they were actually rather good at holding local authorities to account. But the last government abolished them because they were a bunch of idiots ... step forward Eric Pickles in particular.I get the above point about voters not turning out, but it amazes me that there's not some kind of central government oversight and rules on what they're allowed to spend thier money on.
After the coalition government reduced funding, sold external audit work off to the cheapest bidder and abolished the commission, they then told councils to take more risk.
The wheel has now turned though, and councils' were only supposed to take risks that weren't risky.
There have been relatively few failures such as this though across the sector, with less than a dozen councils getting burnt over poor commercial investment choices. Some have done it really well.
Councils also had a duty to promote economic prosperity and expected to lead on regeneration. Sitting on your hands doing nothing is an option, but it would also be punished at the ballot box. That said, governance and regulatory failures are inexcusable.
However, this does not pass the buck from councils - councils are obliged to follow the local accounting code of practice, in particular the Prudential code for borrowing which basically said can only borrow what you can afford to pay back.
As this was a capital loan the cost of the write off will be born by the general fund over the loan's remaining life (unless the council has capital receipts available to offset the loss) so there will be less income to spend on taxpayers as a result of this in the years ahead. Though to be accurate, it's not just "council tax" that will pay for this, as day to day operations are funded from a range of income.
Ultimately, these failures tend to detract from the sheer scale of financial pressures councils are facing (capped income Vs uncapped demand - no private entity would ever entertain that situation), and I don't think a vote every four years on your ward councillor is a particularly effective tool to hold councils to account either.
What would work? More professional accountability I suppose, but if all the governance was followed and a project failed due to bad luck, is that a professional issue?
How would the private sector handle it? Sack someone due to bad luck, but promote them due to good luck? I'm not sure luck is a reliable basis for extra responsibility, though it would be handy.
Should they have professionally known the project was risky? Well yes, but then you're down the path of only promoting people who can see the future, which would be even more handy.
Absolutely no risks at all was not where the government was 10 years ago, and senior officers would not have lasted long in that situation.
Local government fads (like reorganisation)tends to run in cycles of about 20 years, so I'm sure we'll see this all back in a decade or so.
The wheel has now turned though, and councils' were only supposed to take risks that weren't risky.
There have been relatively few failures such as this though across the sector, with less than a dozen councils getting burnt over poor commercial investment choices. Some have done it really well.
Councils also had a duty to promote economic prosperity and expected to lead on regeneration. Sitting on your hands doing nothing is an option, but it would also be punished at the ballot box. That said, governance and regulatory failures are inexcusable.
RizzoTheRat said:
but it amazes me that there's not some kind of central government oversight and rules on what they're allowed to spend thier money on.
It seems hm treasury who was lending cash thought the department for communities was doing it. And they thought likewise. There is now far more government scrutiny on investments and borrowing, and rules have been tightened.However, this does not pass the buck from councils - councils are obliged to follow the local accounting code of practice, in particular the Prudential code for borrowing which basically said can only borrow what you can afford to pay back.
As this was a capital loan the cost of the write off will be born by the general fund over the loan's remaining life (unless the council has capital receipts available to offset the loss) so there will be less income to spend on taxpayers as a result of this in the years ahead. Though to be accurate, it's not just "council tax" that will pay for this, as day to day operations are funded from a range of income.
Ultimately, these failures tend to detract from the sheer scale of financial pressures councils are facing (capped income Vs uncapped demand - no private entity would ever entertain that situation), and I don't think a vote every four years on your ward councillor is a particularly effective tool to hold councils to account either.
What would work? More professional accountability I suppose, but if all the governance was followed and a project failed due to bad luck, is that a professional issue?
How would the private sector handle it? Sack someone due to bad luck, but promote them due to good luck? I'm not sure luck is a reliable basis for extra responsibility, though it would be handy.
Should they have professionally known the project was risky? Well yes, but then you're down the path of only promoting people who can see the future, which would be even more handy.
Absolutely no risks at all was not where the government was 10 years ago, and senior officers would not have lasted long in that situation.
Local government fads (like reorganisation)tends to run in cycles of about 20 years, so I'm sure we'll see this all back in a decade or so.
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