Published: 12:43, 13 June 2019
| Updated: 12:45, 13 June 2019
Cabinet members have hit back at criticism of Medway Council’s dwindling reserves, insisting the comments come from people who “don’t understand precisely what we’ve done”.
Last month it was revealed the authority’s earmarked and unallocated reserves had dropped by 44% between 2015 and 2018, with the Labour group describing the total sum of money left as “dangerously low”.
But while reporting on the now-completed 2018/19 finances, leader Cllr Alan Jarrett (Con) decided to respond to a “recent front page of the Medway Messenger saying, basically, we don’t have any money”.
He said: “The reason we’ve seen a reduction is because we have allocated reserves for specific purposes. Quite clearly when those projects come to fruition, that money is spent.
“What that means is we’re not exposed in terms of reserves – we still have sufficient reserves to meet unexpected events, we still have sufficient reserves to reinvest into council priorities, and we still have the ability to borrow.
“We don’t have much money, but we have some and we have substantial reserves. Notwithstanding that commentary, we have significant ring-fenced reserves and very, very substantial assets.
“Our finances are in better heart than some people might suggest.”
Despite a £1.991 million overspend on services last year, the budget was balanced thanks to an increase in tax income and a business rates retention scheme pilot – which has not been extended by central government.
Cllr Jane Chitty (Con) added: “We’ve had a very responsible attitude towards reserves. We’ve used them wisely, and most certainly any investment had to prove it had value in it.
“So, I think any criticism about reserves is probably because people don’t understand precisely what we’ve done.”
With a surplus council tax income and “overly prudent” assumptions in the creation of the 2018/19 budget, £2.791 million has now been added to the authority’s general reserves pot.
The Housing Infrastructure Fund bid (HIF) business case will no longer make use of any reserves money, cabinet members were also told.
Cllr Rupert Turpin (Con): “I certainly welcome the very good news that we’ve put money back into our reserves this year. Long may it continue because you never know when you’re going to need those reserves on a rainy day.”