Guildford Liberal Democrats Statement on GBC Financial Position - 12/7/23

Rising interest rates and a number of accounting issues unearthed by a review of council finances have resulted in the council facing a very difficult financial position. The Liberal Democrat administration is now taking swift action to impose the fiscal discipline needed to ensure the Council continues to deliver the public services our residents need and expect.

We will be setting a special budget before the end of July which will include establishing a dedicated financial task force to get the finances in order, strict controls on all new spending, and in-year reductions in spending.

There are a number of issues which have led to the situation Guildford Borough Council finds itself in:

• Previous Conservative administrations committed the council to high levels of borrowing in order to fund a bloated portfolio of major projects
• The Liz Truss/Kwasi Kwarteng Conservative budget last year which kicked off rapid rises in interest rates which have massively increased the council's borrowing costs
• The failure of the national audit system for council finances which, since being privatised by the Conservatives, has resulted in councils up and down the country waiting years for their accounts to be audited
• A decade of local government funding cuts under the Conservatives which have forced councils to eat into their reserves and have led to chronic understaffing of finance teams

As Liberal Democrats we believe in being open and transparent about the scale of any challenge Guildford is facing and the difficult decisions needed to get the finances in order.

Our highest priority will be to protect public services, especially for those most in need, and sound finances are the essential foundation of good public services. Our plan to restore sound finances is as follows:

• Immediately institute spending controls to carefully limit all new spending.
• Review our major projects and planned borrowing, including how our borrowing is structured
• Explore the possible sale of council assets to reduce the need to borrow
• Expanding and strengthening the council's finances team
• Continue with our plan to reduce costs by combining operations with Waverley Borough Council.

Above all, we will not shy away from making the tough decisions to make sure residents are protected from cuts to core services. Our residents will always be our highest priority, and we will be honest and realistic about the choices that need to be made to keep the Council financially stable.

Further information is available in the Guildford Borough Council press statement and report here.