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Pickles slams councils' secret stockpiles of taxpayers' cash

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Pickles slams councils' secret stockpiles of taxpayers' cash


Published by Max Salsbury for in Local Government and also in Central Government, Finance

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Eric Pickles has slammed local authorities for claiming they have no money while stuffing billions of taxpayers' cash into their "municipal piggy banks".

New figures from the Department for Communities and Local Government show that councils increased their cash reserves by over 20% in real terms since 2010 to 2011. Reserves now stand at over £19 billion - an increase of £2.6bn in the last year alone.

The communities secretary has now called on local authorities to consider whether such substantial reserves are necessary at a time when they should be focusing on protecting frontline services for residents and making sensible investments for the longer term.

Pickles said: "There are no rules on what councils should hold in reserve and taxpayers will be amazed that while councils are amassing billions in secret stockpiles some are pleading poverty and raising council tax bills for hard working families.

"Everyone appreciates the need for a financial umbrella for those rainy days but keeping reserves at levels unprecedented in recent years should give local residents pause for thought. Instead they could be tapped into to ensure councils can protect frontline services and keep council tax down for hardworking people.

"Councils can also look at using reserves to pay for the short-term costs of restructuring their management structures to save millions in the long-run."

Councils account for a quarter of all public spending, and are forecast to spend £102bn in 2013 to 2014 - up 4% from their forecast the year before.

The CLG's figures also show that councils’ in-house spending continued to rise by a further 2% despite repeated calls by ministers to reduce administration costs and overheads.


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