More concerns raised over use of Northumberland council's reserve funds

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More concerns have been raised about Northumberland County Council continuing to spend its cash reserves.

The Conservative administration has dipped into reserves in recent years to provide match-funding for projects such as the Northumberland Line. Council bosses have insisted the £50m general reserve fund has not been touched.

But opposition councillors have begun questioning how the cash will be replaced in future years ahead of the setting of the 2024/25 budget. The issue was raised earlier this month by Green councillor Nick Morphet, and on Monday it was the turn of independent councillor Malcolm Robinson.

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Speaking at an all-member scrutiny meeting on the local authority’s draft budget proposals, Coun Robinson said: “I wonder about reserves – how are we going to replace them at some point?”

Northumberland County Council Headquarters at County Hall, Morpeth. Photo: NCJ Media.Northumberland County Council Headquarters at County Hall, Morpeth. Photo: NCJ Media.
Northumberland County Council Headquarters at County Hall, Morpeth. Photo: NCJ Media.

Responding, council leader Glen Sanderson said: “I think it is important to realise that we haven’t touched our £50m general reserves. Over the last few years we have been building up reserves to match significant funding offered to us.

“We’re utilising that extra money very prudently in the climate we have today. We haven’t touched our general reserve and we have no intention of doing so.”

The council’s chief financial officer, Jan Willis, did admit that relying on reserves was not sustainable in the long-term.

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Ms Willis said: “We have drawn down from reserves quite heavily in recent years because of the post pandemic and the cost of living environment we have had to navigate.

“We are not using reserves to fund recurrent costs but we have built them up over time to give us the ability to weather those really adverse conditions. Reserves are finite, we can’t continue to do that indefinitely.

“At some point, we will need to build reserves up again but this is not the time.”

Ms Willis also said that she would be bringing a more detailed report on the council’s reserve policy and its sustainability to the cabinet at a future date.

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At the end of March last year, the council had a total of £285.3m in its reserve fund. This was estimated to fall to £250.3m by the end of March 2024.

The documents detailing the current reserve as part of the budget have not yet been published.