Second 2009 Liberal Democrat budget for Cambridge is "like emergency surgery at the scene of a road crash"

28 January 2009

Cambridge Labour Councillors have described the just issued 2009 Liberal Democrat replacement budget for Cambridge City Council as 'the financial equivalent of emergency surgery after a road crash'.

The 2009 replacement budget proposes future cuts of over £1m to the council's capital fund (section 106 raised from recent developments) for new youth clubs, recreation facilities and city environmental improvements, a further £250,000 chopped from new cycling schemes, and an emergency loan of £1m in 2010 to avoid the risk of the city's finances sliding into the red.

The city's unprecedented budget problems follow the calamity of two massive recent black holes in the City's finances, the expected £9m loss in Icelandic bank Landsbanki and its subsidiary plus £342,000 lost in interest, and all £618,000 lost from 2008 Cambridge Folk Festival Internet ticket sales (as we reported here).

Cllr Lewis Herbert, leader of the City Council Labour group, said:

'The replacement Liberal Democrat 2009 budget for Cambridge is the financial equivalent of emergency surgery after a road crash, following the council's recent self inflicted losses of millions of the city's money in Iceland and Folk Festival tickets.

'Due to the LibDem council's efforts to plug the budget holes, residents and particularly teenagers are now the innocent victims of their road crash budget, losing out on over £1m in funding cuts for future youth clubs, recreation facilities and city environmental improvements.

'Unlike the County Council and other councils, Cambridge Liberal Democrats have specifically organised City 'scrutiny' committees so they control them and limit scrutiny, and this is a major factor in the budget mess the city is now in.

The importance of scrutiny has also been echoed by Councillor Paul Sales, Labour Leader at the County Council who said:

'The County Council has its financial problems, but it would never have got into this mess. It now has a proper scrutiny process and these issues would have been picked up. Quality scrutiny has been a legal requirement on councils since 2001, but one which city Lib Dem councillors have sought to evade. The consequences are there for all to see, City Executive Councillors pretending that the loss of millions of pounds is just bad luck.'

Cllr Herbert added

'Only a year ago the City Council was financially A1 with £80 million in investments and £14 million in ready reserves.

'Now, the Council has lost potentially £9 million plus in Iceland, has a further £10 million stuck in now questionable Irish banks, and is having to secure an emergency £1m loan in 2010 just so it can ensure it stays solvent. The 2009 budget does not even balance, despite some extraordinary financial manouevres and a host of problems have been put off to 2010.

'Residents deserve answers, why all the losses, and what are they really getting for the Liberal Democrat's planned 4.5% council tax increase, when inflation is only 1.2% and there are massive budget cuts.'

If you want further details on the full scope of the problems the Liberals are presiding over, click here.