H&F launches "debtometer" to track progress against debt

 

H&F Council has oft-complained of the "debt mountain" it inherited from the previous Labour council, complete with glum-looking pics of Council Leader Stephen Greenhalgh, accusing their predecessors of racking up crippling levels of indebtedness that saw the council taxpayer forking out huge amounts in interest payments before any of their hard earned cash was left for vital public services.

This assault on what they termed Labour's profligacy helped propel them to a whopping majority at the Town Hall in the election before last, effectively wiping out the local Labour Party. Among those losing their seats that night was Labour Council Leader Stephen Burke, as the Tories swept to power with a majority of 20.

Since then their guiding light has been the mission, as they see it, to reduce the Council's debt and to do more for less, to use a mantra from David Cameron. When I reported on the Prime Minister's visit to the area during the General Election it was clear he viewed what was happening here as a blue print for the rest of the UK's approach to belt-tightening in the public services, as he spoke of his "pride" in what H&F were doing.

The controversies to follow have been inevitable with the selling off of what seems like every Council building apart from the Town Hall itself and the turfing out of numerous voluntary sector services that were housed within them. (To be replaced, as far as Paddenswick House is concerned in Hammersmith, with the West London Free School)

So it comes as no surprise that the Council wish to re-draw our attention to why all of this is happening - debt. And rather than be on the back foot about that, defensively justifying things, they quite understandably want to proclaim their war on debt as the good thing it is. hence the "debtometer"!

Launching the 'ometer, Council Leader Stephen Greenhalgh says this:

"Nationally and locally we have seen the dangers of excessive debt and we are the only council in the country that is consistently cutting council tax and lowering the council's debt!

“Spending millions of pounds on costly interest repayments to the banks just to stand still is economic madness and is a ticking time bomb if interest rates rise – as they must do at some stage.

“Therefore our strategy for the past five years has been to reduce the council’s historic debt so that taxpayers’ cash, which had been spent servicing interest costs, can be redirected to protect frontline services like caring for the vulnerable, child protection, street cleaning, more Police, schools and parks. Only by cutting debt can we secure the strong financial future that the borough deserves and this year’s progress means we are on track.”

But local Labour Opposition Leader Stephen Cowan sees it rather differently, he has this to say:

"The Conservative Council’s financial plan fails to offer value to local people and demonstrates their economic illiteracy. They are cutting these borrowings by selling off important buildings such as people’s homes, child care centers, voluntary groups' buildings and libraries - as reported on this blog. Putting aside the right and wrongs of that for one moment, they’re doing this in the middle of an economic slump. That means these buildings are being sold off to property speculators at knock down prices during a period when the Council has record low interest rates to service their borrowings. That’s like a family buying a house at the top of the market, selling at the bottom of the market and having nowhere to live afterwards.

I was Deputy Leader of the Council in 2005/6. Back then, I reduced borrowings by more than the Conservatives have ever managed in any year since. But that was because the buoyant economic conditions, the council’s asset base and relative record property prices made it right for that policy then.

Because of the peculiarities of local government finance, the Conservatives actually only gain just over £30,000 into the revenue account for every £1 million building they sell off. Meanwhile, they are wasting £35 million on new unnecessary Town Hall of offices; wasted £5 million each year on propaganda; have recently admitted they’ve lost up to £4 million a year on unmanaged consultancy contracts and spend millions of pounds more than they need employing some of the highest paid bureaucrats in the country. In short, if they really want to find money for front line services they should get their own house in order before selling off our community assets to their friends in the property speculator sector."

 Harsh words - from both sides. And expect the controversies to rumble on.