By Carmelo Garcia – Local Democracy Reporter
Concerns over the impact a council’s risk of “bankruptcy” could have on local government reorganisation in Gloucestershire have been dismissed by its leader.
Gloucester City Council needs between £12.5m and £17.5m in emergency funding from the Government to avoid having to issue a section 114 notice.
While councils cannot technically go bankrupt, such a notice would restrict it from any new spending commitments.
Council chiefs have agreed to request the exceptional financial support which would need to be paid back.
And the authority’s dire financial situation is unfolding at a time when plans to reorganise councils in the county are underway.
Three proposals have been submitted to the Government to merge Gloucestershire’s districts with the County Council and create one or two unitary authorities.
Questions were raised at the City Council about what impact the potential of becoming effectively bankrupt could have on this process at a special meeting last week.
David Redgewell, a member of the public, said: “The most important thing is to get this council out of special measures or a situation like Birmingham.
“Taking a council that has gone bankrupt into a unitary government is something the mayor of the West of England said was impossible to do.
“If it’s still bankrupt by the time they try to vest a new council, there will be a lot of problems with trying to merge with the Forest of Dean, Stroud or the whole of Gloucestershire.
“Never mind going in with the West of England Combined Authority”.
However, these concerns were dismissed by the City Council’s Liberal Democrat leader Jeremy Hilton (LD, Kingsholm and Wotton).
He said: “The current state of the finances of Gloucester City Council [will] probably have no impact on local government reorganisation as such.
“There’s still loads of work to do. That’s where we are.
“I don’t think there is going to be a direct impact on the three options the Government is considering.”