THE leaders of a council which is proposing to run down its coffers almost to the legal minimum to fund frontline services have been warned the plan “has risk all around it”. 

Members of Darlington Borough Council’s influential scrutiny committees said while they supported supported the Cabinet’s proposals for fees and charges and a council tax rise of 2.99 per cent, they wanted to highlight “severe risks”,  including those associated with Brexit, surrounding its plan for the next four years.

A meeting of the council’s efficiency and resources scrutiny committee heard members agree a balanced budget had been prepared for the coming year, but beyond that there was “enormous uncertainty”. 

Such was the bleak financial forecast facing the authority, the meeting was told by the end of the second year of the four-year Medium Term Financial Plan, (MTFP) the council could be approaching statutory minimum reserves.

The council’s assistant director of finance, Elizabeth Davison, told members Darlington was not the only local authority facing financial uncertainty.

She said work was under way to prepare for a range of Brexit-related consequences, such as holding talks over staffing with care home providers and the NHS about medical supplies.

Ms Davison said: “Why I’m feeling a little bit of comfort is because we are still in the first year of the MTFP next year and we still have £15m of balances that could be utilised if the worst came to the worst.

“The year after that we would have a problem, but the whole country would also have a problem and it wouldn’t just be one local authority that would have to try and manage the situation.” 

Conservative councillor Charles Johnson said it would be “very difficult for us to approve a Medium Term Financial Plan that takes us to the brink of a financial crisis”.

Independent councillor Alan Coultas added the contingencies that had been made in the plan were normal, “as if nothing had changed and we were living in a world we’ve been used to”. He said: “The possibility of our backing out of Europe with no deal is serious, which raises the risks even more. We are living in times of enormous uncertainty and the uncertainty is increasing. And here we are about to sign off a four-year plan that has risk all around it. At the very least we need to register that there is great risk around this MTFP which we are being asked to sign off. “

The committee’s chairman, Councillor Ian Haszeldine, said he shared the councillors’ concerns, but highlighted the difficulty in preparing financial plans in the face of such uncertainty.

He said: “The other thing that worries me even more is the scaremongering around it.”