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Council’s bid to claw back £17m lost in Iceland investment bungle
MILLIONS of pounds of taxpayers’ cash lost by Westminster Council in the Icelandic bank crash are being clawed back through a series of cuts.
Finance chiefs confirmed in October it had lost £17million in foreign banks it had been advised not to invest in.
Council leader Colin Barrow said at the time there was “absolutely no threat to the delivery of any of our services”.
But in a cabinet meeting on Monday in City Hall, the council’s finance director Peter Carpenter proposed “significant savings” of £30m in a budget report for 2010/11.
He said: “Due to the impact of the changed economic climate, expected reductions in interest rates and the potential loss of the council’s Icelandic deposits, it is recommended that additional net efficiency savings of £30m be identified.”
Mr Carpenter said the flagship £2m ward budgets scheme – where ward councillors are each given a “wallet” of £100,000 to meet specific demands of residents – will be axed in 2010.
Councillor Audrey Lewis said: “It is important to stress that funding for the scheme was only guaranteed for two years. This is not a new announcement and was made clear when the programme started.”
More than £6m for other community projects has been identified as part of the savings drive, along with a further £6m saving from the temporary accommodation housing budget.
In September, the West End Extra reported fears over the council’s new “innovative” investment strategy. Finance chiefs pumped taxpayers’ cash into high risk schemes in an attempt to boost profits from 4 per cent to 8 per cent.
Councillor Paul Dimoldenberg, leader of the Labour Group, said: “The Conservatives’ reckless financial gamble chasing high interest rates in Iceland will now bring misery to many.
“It is a sorry state of affairs for which the Conservatives have yet to apologise or take responsibility.” |
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