Fire sale ordered as North Tyneside Council's debts deepen

NORTH Tyneside is facing an "everything must go" sale as council bosses struggle to find £9m in five months.

NORTH Tyneside is facing an "everything must go" sale as council bosses struggle to find £9m in five months.

The cash is vital if council bosses want to carry out any of their long-term spending plans, but despite agreeing the sale in principle earlier this year they have made less than half a million pounds so far.

Last night Conservatives claimed to have uncovered further evidence that a multi-million pound budget was signed off by their Labour predecessors despite huge financial holes.

North Tyneside’s fire-sale is just the latest financial worry to hit the cash-strapped council.

A rise in the cost of voluntary redundancies has seen another £2.2m added to costs as more golden goodbyes are handed out to long serving staff.

Spending chiefs at the council say they may have to increase their borrowing levels to find the cash.

An extra £15m added to council debts or raided from reserves would force treasury officers to find money for repayments before they allocated cash to routine services such as social care or bin collections.

Elected Conservative mayor Linda Arkley, who took over from her Labour rival John Harrison last June, said the funding crisis comes down to “wild” spending plans put together by the previous administration.

Conservative group leader Michael McIntyre, who chairs the council’s finance sub-committee, said he would be launching an investigation into how the budget the Tories inherited was ever agreed.

He says more than £9m was identified in potential savings despite the then council bosses knowing millions of pounds worth of savings from the previous financial year were still outstanding.

And within weeks of the previous Labour council agreeing the budget it became apparent that around £3m of those identified savings would never be achievable.

Mr McIntyre said: “We are having to crash spending and find these savings because of what we inherited.

“We’ve basically got a spending plan that was agreed even though there were millions of pounds missing.

“We’ve got a legal responsibility to balance the books now, but we find ourselves asking how it was ever allowed to come to this.”

Mr McIntyre added he was confident officers had identified enough “top asset” sales and any borrowing needed would be made on a short term basis.

But Labour councillors have denied the claims and insist Ms Arkley is looking for excuses to cut spending.

Labour group leader Jim Allan said the rise in debts is in part down to a rise in the number of people seeking voluntary redundancy.

Last night he claimed staff are “under pressure to go to help keep costs down”, a move denied by Tories.

Mr Allan added: “They are going to have to increase borrowing and debt, which taxpayers will be responsible for, just to meet political aims.

“There are already land sales worth more than £9m needed and we can see how the council is going to need to find millions more at a time when they can’t even fund the current plans.”

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