Cash-strapped councils win government support

Struggling councils in Berkshire and on the Isle of Wight have been given government help to balance their books.

The authorities - including Slough, West Berkshire and Windsor and Maidenhead councils - have been granted Exceptional Financial Support (EFS) from April.

It gives them extra powers to pay for services by borrowing money or selling assets.

The government said its package would help authorities to recover financially. However, Isle of Wight Council leader Phil Jordan said ministers had only offered "more debt".

The Independent councillor said: "EFS is not new funding. It is not investment. It's not a grant.

"What we have been offered is more debt. And more debt. And more debt. Year on year for another 20 years."

He said the government had warned councils to minimise borrowing "even while [it] forces us into the position where borrowing is the only option left".

Councillor Jordan said the extra debt "simply kicks the problem further down the road".

The EFS packages, agreed in principle, include £12.9m for Isle of Wight Council, £30m for West Berkshire Council, £42.9m for Slough Borough Council and £48.8m for the Royal Borough of Windsor and Maidenhead.

They allow the authorities to allocate spending to capital rather than revenue budgets.

Revenue spending - day-to-day expenses such as staff salaries - is usually funded through income such as council tax and government grants.

Capital spending - including purchases and investments - is typically funded through one-off asset sales and borrowing.

The government has listed 36 English authorities receiving EFS from April and one for the current financial year.

Slough has been granted EFS every year since 2018. The other two Berkshire councils are in their second year of EFS.

West Berkshire's previously-announced support for the current year has been revised from £3m to £20m.

Councils receiving EFS must allow the government to review their financial management.

Local government minister Alison McGovern said: "We will ask these councils to develop robust plans for improving services, so they reach a stable position over the multi-year settlement.

"We know that investment in prevention can deliver better outcomes for people and improve financial sustainability."