As yet Another Surrey Council Is Fighting Off Bankruptcy

The desperate fight by Surrey Heath Borough Council to fend off bankruptcy crystallised further this week after it agreed to sell a car park and land in order “to keep the lights on”.

The council, which neighbours Guildford borough to the north west, has to make huge cuts this year to balance its budget after long-delayed audits revealed millions of pounds were missing from its balance sheet.

This included more than £8 million being wiped off its reserves effectively overnight, as well as the downgrading in value of its significant assets, which were bought as part of a £100 million regeneration project.

The elephant in the room is the real issue. What will happen to the £billions of pounds of debt owed by Woking, Spethorne and Surrey County Council?

The council recently agreed to sell the Woodend Road car park in Deepcut and the land on London Road in Camberley to begin clawing back desperately needed cash.

Failure to balance its books would result in the loss of support provided to the community through services such as Meals on Wheels, funding for the Citizens Advice Bureau, children’s play parks, and other non-statutory provisions.

It comes as the council must shed £1.74 million this year through savings, reduced interest payments, and a further £500,000 from “service delivery reviews.”

The purpose of any potential disposal of land, the meeting heard, is to bring in money for the council, which is “in financial distress, and we cannot incur further related costs”.

Council leader Shaun Macdonald (Lib Dem, Lightwater) said. “Car park, play parks, dictionary services, the support we give to the local community will go in the blink of an eye, so yes, these are tough decisions, but these were the tough decisions we were elected to make to protect the most vulnerable in our society. Two to four play parks can be renovated (instead) for young people to enjoy for the next 15 years. How many young people will benefit from that? Citizen’s advice bureau funding, it can also support, potentially, the provision of meals in people’s homes.”

Decisions are being made based on what the council considers is best for the entire borough, rather than the specific area affected.

The first tranche of sales the council is considering:

• Loss-making parking in Surrey Heath. Car parking in Surrey Heath is particularly vulnerable, as, by law, it does not need to be provided. Any council that declares itself bankrupt cannot spend money on discretionary services that do not pay for themselves.
• The London Road land sale, described as a “small plot” and said to have no value financially to the council, but incurs unnecessary costs.

Cllr Murray Rowlands (Labour, St Michaels) said it had been “blighted with fly-tipping and parking” and was “a serious problem that affects the whole of that part of Camberley.”‘

Cllr Macdonald added that it was “a fly-tippers paradise.”

The Deepcut car park sale proved more divisive, and not just among opposition members who were calling for the sale to be halted because it would deprive the area of much-needed parking spaces.

Deepcut is undergoing a massive transformation, with the former military barracks being converted into a significant redevelopment project.

Cllr Cliff Betton (Lib Dem, Mytchett & Deepcut) said: “I fully understand the need for the council to raise funds from the sale of assets surplus to requirements.

“We have to have a balanced budget at least until the time the new unitary authority comes into being. After that, Surrey Heath Borough Council will cease to exist, and it will be up to others to make decisions for the people of Deepcut.”

He added: “Everyone knows there are plans approved for Deepcut and it’s now renamed Mindenhurst, 1200 homes are being built, some are already completed, and there are still another 800 homes to come.

“Parking for the old Deepcut village pre-Mindenhurst was OK, it worked, sometimes a bit crowded, but the car park was well used.

“But this will see just eight car park space increases in a village with 800 new homes, a ratio that doesn’t even meet Surrey County Council’s standards.

“If we want to build a better future for Deepcut, and Mindenhurst is part of that, we can not make a parking blight from the outset.

“Wooden Road needs to stay as a car park.”

Cllr Kel Finan-Cooke (Lib Dem, Watchetts), property and economic development portfolio holder, said: “We would prefer not to have to make decisions like this.

“We would prefer not to be in a position where we need to achieve capital receipts to keep the lights on at Surrey Heath for the next two years, but that’s the situation we are in.

“We don’t want to have to consider the sale of lands, but we absolutely must.”