Council reserves at end of 2012/13

By on 06/09/2013 in Rebuttals

Over the last few days there have been a number of misleading media articles in which local councils have been accused by ministers of sitting on “excessive” reserves. The following is a statement from Birmingham City Council, clarifying its position:

A Birmingham City Council spokesperson said:

“Many of the reserves shown in the council's statement of accounts are not available to fund general council services (e.g. school's balances) or can only be used for specific purposes (e.g. to fund Housing Revenue Account or capital expenditure).

“In addition, government grants carried forward at the end of the year to meet specific items of expenditure at a later time are also included in the reserves figure.

“General reserves not referred to above amounted to £107.7m at the end of 2012/13, of which £82.7m were earmarked for particular areas of expenditure.

“Therefore, the General Fund Balance, which is more generally available to support services (reserves in the understood sense of the word), was £25m at the end of 12/13, a decrease of £6.1m from the previous year.

“These figures are in the context of total gross annual expenditure of the city council of £3.41bn (£2.25bn excluding schools and the HRA). Even if they were available, reserves can only be used on a one-off basis.

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