The East Devon District Council, like other rural councils, suffers from the current funding formula which disproportionately favours urban councils. [Rural Services Network]
EDDC has a total amassed debt of over £83.5 million.
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How financially secure is East Devon District Council?
As noted by a correspondent recently:
“EDDC are not short of funds. They have significant reserves, and a balanced budget. Staff levels are at their highest ever, and in fact staff numbers have increased substantially over the last two years in particular.”
In their Financial Monitoring Report from November, the council does indeed talk of surplus and reserves:
The continuing rise of base rates and the associated impact on term deposit and money market rates is resulting in a significant surplus to budget
And by law the council is obliged to set a balanced budget – which this month’s cabinet looked at.
However, the East Devon District Council, like other rural councils, suffers from the current funding formula which disproportionately favours urban councils. A year ago, the Rural Services Network made a big noise about the need for fairer funding for rural authorities – and now it’s launched a campaign:
The consultation on the way that Government allocates funding for rural councils closed yesterday. However, you can still help our campaign. We have encouraged local authorities to talk to their MPs about their current financial situation and the decades of unfair funding for rural councils and we are now encouraging you to do so too! We want you to write to your MP telling them of your frustrations, and the impact on your communities of the unfair settlement.
So, despite EDDC’s current surpluses and balanced budget, how secure are their longer-term finances – especially as they face another year of ‘unfair funding’?
Moreover, there is also the question of debt – with questions about the extent of the District Council borrowing going back some years. This report is from 2019, from the Futures Forum blog:
The shenanigans of the District Council when it comes to money is often reported on by this blog…
Whether about its ‘investment’ in highly speculative property markets: Futures Forum: District Council’s £20m investment fund: “Property investment brings with it the potential for significant risk if things go wrong.”
Or about its ‘savings’ over its relocation project: Futures Forum: Knowle relocation project: an overspend on loans
The Herald has just put together a story on how much the District Council is in debt: East Devon District Council’s has £86.8 million in outstanding loans to pay | Honiton, Axminster and Seaton news – Midweek Herald
And as covered by the VGS: District Council borrowing goes up by £3m – Vision Group for Sidmouth
So, there’s quite a long history to the debt accrued by the District Council.
And in fact, as covered by the Express yesterday, EDDC has a total amassed debt of over £83.5 million:
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