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7 May 2014, 06:08
Norfolk County Council are considering more cuts to pay £30m bill to cancel contract.
A report to Norfolk County Council’s Cabinet on Monday will explain how the £11.3m funding gap to cover The Willows termination costs will be met, recommends largely using a combination of savings for the current financial year and underspends from 2013/14.
The total amount the County Council is required to pay for termination for planning failure is up to approximately £30.3m. Of this, £19m was earmarked as a residual waste treatment contract reserve, leaving a £11.3m gap.
To find this sum, the County Council has been helped by a £3m underspend for 2013/14 as well as £500,000 grant funding from the government. A number of additional ways of financing the savings for the previous financial year have also been found, including using earmarked reserves for organisational change (£1m), the car lease scheme (£250,000) and the Icelandic banks (£290,000).
In his report, the Council's Interim Head of Finance has identified that there still remains a shortfall of around £1m for the current financial year, and suggested two alternatives for finding this.
The Leader of Norfolk County Council, George Nobbs, who has asked the Prime Minister and the Chancellor for Government financial assistance with the cancellation costs of the Saddlebow waste infrastructure project, said: “Nobody wanted to have to find this money and we always warned this process would not be without pain. Our finance team has done its very best to minimise the direct impact on services for Norfolk people. However, no matter how much we have tried to minimise the impact, it would be foolish to pretend that there won’t be some cuts that will hurt.
“We have decided to present two options to the Full Council for consideration – to either take £900,000 from highways maintenance and a further £140,000 from the libraries book fund or, alternatively, to find the missing £1m or so from about half of the money from second homes that the county council gives to district councils.
“Either way, neither option is an attractive one, but we have to find £30m to fund a sum that none of us wanted to have to pay.”
Also included in the proposed savings for the current financial year are £700,000 found from sale of property and a £500,000 contribution from the Norse Group.