Wednesday, 20 June 2012

Another 35% grant cut for Cornwall?

At a Cornwall Council event yesterday to discuss planning issues, the Chief Exec made a splash by saying that he thought the authority could be facing a cut in its Government grant in the future of up to 35%.

To put this into context, the government grant is the largest single source of income to the council, but sits alongside council tax, fees and charges for services and business rate income. In addition, the 35% figure is the worst case scenario. Others have talked in terms of a 25-30% cut and the Chief Exec assured us that the council would not be making firm plans until the figure is known in roughly two years time.

Cornwall Council has already made huge budget cuts - but most of these have been mitigated by the change from seven former councils to a single unitary council. Had we stayed with the old council set up then the impact on front line services would have been much greater than the £10 million we have suffered.

The Chief Executive was questioned about how Cornwall Council could escape the worst effects of such a grant cut. He indicated that growth through development - sustainable and sensible development in his eyes - was one of the ways that the worst effects might be mitigated.

I'm concerned that this is seen by some as the only answer. Of course Cornwall Council should be looking to assist with and enable development which can make Cornwall better, but this has to be balanced against the need to preserve our historic environment and culture and to think for the long term, not just the next couple of years. I am concerned that anyone should be advocating giving developers a free rein which would be a hugely risky venture. That's not the position of Mr Lavery, but is one being put forward by some.

One lesson from recent history shows why relying on growth and development is a risky strategy. In Ireland in the 1990s and 2000s - the 'Celtic Tiger' years - developers were given a free rein and used low interest rates to invest in many schemes which any sensible review would have said could never come off. Jobs and wages rose massively for a time, but then crashed to earth and the whole national economy then needed an EU bailout.

It is right that the chief Executive should be raising this issue now - and starting a debate across Cornwall on how we should seek to avoid further front line service cuts. But I hope that no one seeks unchecked development as the answer.

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