Gloucester city chiefs facing ‘biggest crisis’ are ‘confident’ in clinching bailout in February

Gloucester council chiefs say they are confident they will secure a potential bailout by February to save it from its “biggest crisis“ after good talks with the Government.

Gloucester City Council is facing effectively becoming bankrupt if it does not secure emergency financial support of between £12.5m and £17.5m from the Ministry of Housing, Communities and Local Government (MHCLG).

Council chiefs say the only way it could avoid having to issue a section 114 notice, which would mean it would not be allowed to commit to any new spending, is if it secures exceptional financial support.

Cabinet agreed last night (Wednesday, December 10) to apply for the funding which they expect to receive in February, if approved by the Government.

They will also be implementing a financial recovery plan which includes hiking parking charges, a mutual resignation scheme, giving up the lease for Blackfriars and reducing opening days at the city museum and cutting jobs.

The authority will also be selling off sites which are surplus to requirements or which they run at a loss.

Several questions were tabled on the day by members of the public and council who are extremely concerned about the authority’s finances.

Labour group leader Terry Pullen (L, Moreland) asked how much longer the council’s finances would be run on “guesswork”.

“It appears council finances and processes are still operating on best estimates, or if you like, guesswork.”

“When will we know and when will we have statistics that are true, accurate and reliable”.

Deputy leader Declan Wilson (LD, Hucclecote) said they inherited a council which was “probably already bust”.

He said it was “probably the biggest crisis the council has faced in its history”.

He said they have started a proper budget monitoring process and have asked the Local Government Association to advise on what resources the finance team needs.

“I’m afraid the simple truth of the matter is we inherited a mess,” he said.

“We are fixing it now and these processes are now being put in place.

“Moving forward we will be dealing with real numbers rather than sort of the estimated numbers we’ve been relying on in the past which sadly turned out to be somewhat wide of the mark.”

While Community Independent Alastair Chambers (Matson, Robinswood and White City) asked what the bill would be to residents of the council’s financial recovery plan.

However, Cllr Wilson said there were too many variables and it would depend on how successful they are in raising revenue.

“I can’t say for sure how much it will cost,” he said. “All I know is the people we’ve got in place to fix it, I have every confidence in.

“We have a new head of finance, a new head of place that are doing excellent jobs.

“We will be focusing mainly on raising the income from our commercial property. The quicker we get this fix, the less it will cost.”

David Redgewell, a member of the public, asked how the council’s discussions with central government were going.

Cllr Wilson said the talks with Ministry for Housing and Local Government are “going quite well”.

“We are confident that we will get the help we ask for,” he said.

“Rather frustratingly we won’t get a final decision until February time. But from the indications of what we’ve had and what they’ve been telling us, it does look reasonably OK at the minute so we should be all right.”

Cllr Wilson (LD, Hucclecote) also told the meeting that commissioners would be sent in if the council does not put party politics to one side and come together to deliver the recovery plan.

“The council has to treat the delivery of its recovery plan as if it were in a section 114 scenario,” he said.

Housing cabinet member Luke Shervey (LD, Longlevens) said it was about safeguarding the service while transforming the council to get it on a stable footing.

And culture and leisure cabinet member Caroline Courtney (LD, Tuffley) said it was with a “heavy heart” that she would support the proposals.

She paid tribute to senior officers who have handled the plan as delicately and pragmatically as they could and staff members who may be affected.

“I know we have amazing staff members in the cultural teams,” she said.

“They do an amazing job and add a personal touch to customers they come in contact with.

“I’m really gutted they are having to go through this at the moment.”

Community engagement cabinet member Rebecca Trimnell (LD, Westgate) said the council is an “absolutely shocking” situation and was concerned the overspend would increase.

“My deep concern is that the position isn’t closed for 2024/25,” she said.

“My fear is that that will actually go up.”

Council leader Jeremy Hilton (LD, Kingsholm and Wotton) said they took over the administration with three sets of accounts that were incomplete.

He said they asked questions of this while in opposition.

“I never thought it would get as bad as this,” he said. “It’s a shock we’ve got to this point.

“For the first time in five or six years have an accurate figure on the incomes and outcomes of this council.”