Slough Council is asking to sell nearly £300million of its properties
SLOUGH Borough Council has submitted its request to the government to sell nearly £300million of its properties to reduce its financial burdens.
Local authority chiefs will consider selling up to £600million of the city’s 6,700 assets, which are worth a total of £1.2billion, over the next five years.
It’s to do loan “more manageable” by reducing its debt from £760m to £335m by 2027 and reducing its projected budget gap by £308m by 2025.
Senior advisers gave the green light last year to a team of outside specialists, who have not been publicly named by the board, to handle the operational aspects of the asset disposal.
AT plenary session of the councilCouncilor Rob Anderson (Lab: Britwell & Northborough), Senior Member for Financial Oversight, Council Assets and Performance, has announced that he has formally requested the government to sell £201m of council properties this year and an additional £72m to be covered next year as part of the recovery plan.
This is called a capitalization direction, which would allow the board to use capital money as income for day-to-day expenses.
It remains unclear which assets the council plans to dispose of, but past purchases include the Odeon cinema in Basingstoke, a Wickes store in Wolverhampton and the Moxy Hotel in the city.
Speaking at the meeting on Thursday January 27, Cllr Anderson said: “We have submitted our submission to DLUHC [Department for Levelling Up, Housing, and Communities] regarding capitalisation, which stands at £201m for the current figure and an additional £72m to cover next year.
“We have responded to DLUHC’s request for questions, clarifications and answers, and expect further discussions with them when they give us this new funding directive.”
He also said all of the council’s short-term borrowing had been ‘refinanced’ and residents would be fully aware of the financial implications for them when the 2022/23 budget is presented by the end of March.
Tory leader Dexter Smith (Colnbrook with Poyle) said every time the council talks about capitalization the figure being asked “seems to be more important”.
He said: “As we look at these numbers, they seem to be getting worse and worse, and they represent a large-scale failure of this council in every department. It certainly cannot be blamed on the Department of Finance.
Cllr Smith asked what is ‘plan B’ if the government denies the council’s request. He also cited the Minimum Income Provision (MRP), the money set aside to repay loans, was “not quoted correctly” after rising to £69million.
“How are we going to handle this situation? [MRP] in our budget next year? The only answer is that council tax will reach record levels. We already have record levels of debt in this council, the largest debt in the country,” Cllr Smith continued.
Cllr Anderson reiterated that this is why the council is asking for a capitalization direction from the government so they can set a “realistic” and “achievable” budget for the future.
He could not comment on the legality of previous budgets, but admitted that the financial details were wrong.
The finance team is currently digging into past council accounts to shed light on past mistakes. It has already been reported that 60% of the notes in the 2018/19 accounts will need to be ‘restated’ due to inaccuracies and errors.
Cllr Anderson said: “The team is still discovering issues that date back some time. So it’s still a work in progress and we’ve been very clear with DLUHC about that, that the things presented to them are snapshots in time and until we hit those numbers things can still change.