The Save Our Nurseries campaign says the Council should find the extra money to top up the budgets of the 14 Council-run day nurseries. The amount of money needed is less than £500,000 – perhaps a lot less after acceptable savings have been made such as employing full-time staff instead of expensive agency staff. It would be a tiny proportion of the Council’s net revenue budget of almost £822m.
Now new figures show that that top-up money is available in the city’s reserves. The city’s overall reserves balance actually increased by about £95m last year.
The Local Government Chronicle (18 May) reports that the council needed to find £85.1m savings in 2017-18. The original budget planned to use £42.2m reserves to balance the budget. In a report to members of the executive, Birmingham’s corporate director of finance and governance Clive Heaphy says that the council over-spent last year by £20.9m. £16m was used “to fund the waste dispute” (£6.6m) and manage “pension fund strain” (£9.4m). So “in total, £63.1m of reserves were used to structurally deliver the 2017-18 budget, plus £11.7m to fund pension guarantees, which will be repaid from existing budgets in future years.”
According to the Local Government Chronicle,
Mr Heaphy’s report notes, however, that the overall reserves and balances position increased by about £95m last year. This was “primarily due”, he said, to the council’s decision to change its minimum revenue provision policy, “which generated an unplanned reserve of £98.3m”. The minimum revenue provision is the minimum amount that must be charged to an authority’s revenue account each year for financing capital expenditure. This will have initially been funded by borrowing.
The reserves and balances pot was further boosted by £36.4m contributions from directorates across the council, while a £23.6m repayment relating to NEC pensions costs was also added.
Overall, Birmingham had £335m in its reserves at 31 March compared to £311m on 1 April 2017.
We say the council should use that extra money to stave off some of the cuts in our vital public services, including the council’s 14 nurseries and the ongoing cuts in libraries.