Letter: Invest in the future West Lindsey

Councillors Darcel and Wiseman make some important points in their letter published on 7 Nov 2012.

In particular the sale of Whitton Gardens site in Gainsborough by WLDC, although designated by the council as a protected area in 2010, needs as much publicity as possible.

Couns Darcel and Wiseman have made sure that many of the key facts have now been published – and this is a matter that needs full public scrutiny.

Last week Gainsborough Town Council voted to ask WLDC to release the advice on which they based their valuation of the site as a hotel development.

What the electorate look for now is both transparency and prudence from all levels of government.

I would disagree with the above mentioned councillors on the following issue: -

Trying to achieve an extra 0.5% interest from capital deposits involves risk.

This was precisely the problem that WLDC fell into with their deposit strategy in 2008.

I have taken an active interest in this matter since Oct 2008, and so I am aware that as a direct result of the Icelandic banking debacle, WLDC have radically tightened their capital deposit strategy – the number one priority now is to hold onto the capital rather than to chase the extra 0.5% interest.

In Nov 2008 WLDC held a total of £22.21m in deposits.

The equivalent figure for 31 Aug 2012 given in the letter of 7 Nov 2012 is £19m and we are also told that as of 22 Oct 2012 the total cash in the bank held by WLDC was in excess of £20m.

We can therefore see that WLDC now holds somewhere between £2.0m and £3.2m less than four years ago.

I am not aware that a final statement has been issued with regard to the overall recovery of capital deposited with Icelandic banks – it might be helpful to know that we can draw a line under this sorry affair, and also to know what losses (interest etc) were actually incurred as a result of the investment decisions made by WLDC (£6m was deposited by WLDC with Icelandic banks in the 3 month period Jul–Sep 2008, immediately before these banks failed).

I would also take issue with Couns Darcel and Wiseman with their proposition that ‘we could give £10m back to tax payers’. Perhaps the wording is unfortunate as it is suggestive of a pay out to individuals.

The £19-20m held by WLDC is the result of an accumulation of funds over a period of time – it is not a ‘windfall’.

All authorities have to meet guidelines on the prudent running of their finances and again it would be useful for WLDC to state publicly what proportion of their annual budget they are recommended to hold as a capital reserve.

Their current reserves appear to be around 43-45 per cent of the annual budget.

If there is scope to safely reduce the capital reserves held by WLDC I would recommend capital investment in community facilities as the way forward.

The residents of Market Rasen and Middle Rasen were told by Coun Keimach that there was not the money to build and run a swimming pool for the Rasen area. Perhaps this could be reviewed?

Guy Grainger

Middle Rasen