Council’s General Reserve Close To Minimum Level
That’s essentially its savings account for unexpected expenses, which is almost down to the minimum level allowed.
The Authority’s Statement of Accounts for the year ending in March 2015, published this week on their website, shows that the fund stood at just £850,000.
That’s perilously close to the £600,000 minimum advisory level and means the Council will need to stick closely to its proposed budget this year.
Back in March 2013, former Director of Finance Peter Lawrence warned that Council was in a “very difficult” financial position and said reserves would be depleted by March 2016 if the Authority continued to spend at its current rate.
At the start of the 2014 financial year, those reserves stood at just over £2m.
The decrease is largely the result of money spent to resurface the roads on St Mary’s.
There is no minimum level for reserves set by law and it’s something decided by each Local Authority and written into their rule books.
But the government advises that Councils should keep sufficient sums so that they have “a financial cushion to meet sudden unexpected costs.”
Councillors will discuss the 2014/15 accounts at the new Finance, Audit and Scrutiny Committee next Thursday.