Councils Upping Taxes To Cover Iceland Losses

[copydude]

Peterborough Council is upping council tax by 2.6%. The council lost £3m in Icelandic banks.

A google of 'Iceland' and 'councils' shows that many up and down the country are in a similar position. Lancashire County Council stand to lose £20m. Herts risked upwards of £30m.

Rows have already started about residents footing the bill.

Skegness

Tuesday, 7.45am: THERE were angry clashes at a meeting of East Lindsey District Council over the £4-million of OUR money at risk in failed Icelandic banks. Coun John Hough repeated calls he made last month for portfolio holder for finance Coun Colin Davie to step down from office.

"When will you apologise to residents and resign?," demanded the Labour member from Louth.

Bucks

A LIBERAL Democrat election hopeful today called on a council boss to resign over a controversial investment in an Icelandic bank.

Steve Guy, the party’s prospective parliamentary candidate for Wycombe, said Buckinghamshire County Council leader David Shakespeare had “overall responsibility” for its £5m investment.

The council has said it relied on independent advice in taking its decision in July to make the investment, with the hope of earning a high rate of interest. Yet Mr Guy said Moody’s Investors Service “cut its rating on all the major Icelandic banks” in February. And he pointed to an article in the Daily Telegraph from February titled “Is Iceland headed for Meltdown?”

Mr Guy said: “The decision to invest in Icelandic banks was made in July when there was clear evidence of problems within the Icelandic banking system.

National row brewing . . .

[DrGUID]

Think yourself lucky living in Peterborough.

Over in Colchester we not only "lost" millions in Iceland, we've also got a multi-million pound unfinished art gallery where the beloved bus station used to be. It's going to cost ~7 million to finish the art gallery (and even more to put stuff in it!) and nobody can agree on who should pay. Unbelievably the council doesn't appear to have a contract, much less a fixed price contract for building the thing.

There was even talk of demolishing the thing!

[Guest Mr Parry]

Think yourself lucky living in Peterborough.

Over in Colchester we not only "lost" millions in Iceland, we've also got a multi-million pound unfinished art gallery where the beloved bus station used to be. It's going to cost ~7 million to finish the art gallery (and even more to put stuff in it!) and nobody can agree on who should pay. Unbelievably the council doesn't appear to have a contract, much less a fixed price contract for building the thing.

There was even talk of demolishing the thing!

Councils have been taking the pi$$ for years.

North Somerset council spend thousands every weekend during the summer putting on forework displays on Saturday nights? Bizarre or what?

They should just perform their minimum statutory duties. Nothing more.

We had this bizarre structure erected in the town centre. It serves no practical purpose and looks ridiculous. Why? It cost hundreds of thousands of pounds, for what?

Time to cut these rip-off merchants and scumbags down to size, reduce council tax, especially for low income OAP's and get back to some kind of sensible local administration.

[the-sign-jacker]

Our local council lost 11 million. though they dont like to talk about it much since theres a 4.5 year waiting list for social housing and local homes are 5x + paltry local wages. private rents are crippling as speculators have purchased most of the local housing through cheap credit, and the local tax charges just keep rising and rising.

ill be glad when it all falls over, then perhaps we wont put the same f*ckwitts in charge of anyone.

their job is to simply serve us what WE require. not to play investment moguls with our taxed incomes.

what the hell where they doing with 11 million in some bank in iceland.

why were they not spending that building new social homes.? (theres a MASSIVE waiting list)

cos they want to keep the high priced, debt gravy train going.

its corruption - pure and simple.

[godless]

Do you think we're past the moral hazard stage yet?

[Nicholas Cage]

Not a problem, I covered Northern Rock, Liquidity, inflation easing, B&B, PFI, Pensions and it didn't cost me anything.

The government should just add it to the running tab of loans and investments I've made in failing enterprises this will

barely show up.

Edited December 9, 2008 by Nicholas Cage

[Mikhail Liebenstein]

Our local council lost 11 million. though they dont like to talk about it much since theres a 4.5 year waiting list for social housing and local homes are 5x + paltry local wages. private rents are crippling as speculators have purchased most of the local housing through cheap credit, and the local tax charges just keep rising and rising.

<SNIP>

Lucky you're not in Kent, KCC lost £50m.

Fortuntely I am not there either.

[the-sign-jacker]

Lucky you're not in Kent, KCC lost £50m.

Fortuntely I am not there either.

im just guessing here, but i reckon kents got a huge social housing shortage too..???

[Converted Lurker]

I'm bit confused here, is this council putting up their community charge as a result of the Iceland bank losses, or simply putting up their rate as they all do every year, well all except Westminster....?

[Logan]

I'm bit confused here, is this council putting up their community charge as a result of the Iceland bank losses, or simply putting up their rate as they all do every year, well all except Westminster....?

Agreed. It would be difficult to justify raising council charge given what are in the grand scheme of things a small loss.

Surrey lost around £25M I believe... given there are 1M people in the county then this is only £25 for every man woman and child. (Its a one off hit too.)

If this is true then I will be the first to complain given this calculation!

[copydude]

I'm bit confused here, is this council putting up their community charge as a result of the Iceland bank losses, or simply putting up their rate as they all do every year, well all except Westminster....?

In the stories I've researched, few councils are making a direct connection. Peterborough's excuse for a tax hike is that Government funding falls short because Government population figures are eight years out of date. Hmmmm . . . never that used that one before. Its £3m losses are small compared to the average.

It is coming to light that almost every local council has a hole in the accounts from investing in Iceland. The Government is not going to cover or recover this money. A case in point is the care home, 'Naomi House'. The Government has ruled that it cannot protect 'wholesale depositors' - only 'individual investors'.

[Timm]

Councils that invested in the UK may be experiencing low returns due to the recent falls in interest rates.

Many had money in Iceland and the UK...

[Executive Sadman]

When they carve up these companies assets, what part of the line to depositors like councils occupy?

Presumably employees are first, shareholders last?

[interestrateripoff]

And the number of council officials who've lost their cushy jobs over this = 0

I don't give a toss if it was on a govt list, any finance manager getting paid £60k+ should have realised what the fook was going to happen and pulled the money out of Iceland.

Instead we have retards in post who like to tick boxes and follow govt rules to the letter.

[chichi]

Oldham council are looking to cut some jobs today - can't find a url yet

But goodnews for the areas as Pubs chain JD Wetherspoon said 200 jobs had been created after it invested £5 million in opening five new pubs.

The outlets at Minehead, Bodmin, Doncaster, Oldham and Sutton are due to open at the end of next week. They take the company's UK estate to 713 outlets

[ElPapasito]

Well, not a council, but I know Oxford University has several £M tied up in Iceland, and in March 08 they judged the risks were too high and adopted a policy of withdrawing all funds. But they were caught out by already having various term deposits locked up in Icelandic banks maturing in Nov 08 through to Jan 09. Probably similar story for most councils and only the real duff ones like Kent failed to change policy 6 months before the collapse.

[PopGun]

2.6% isn't a hike when you compare it to previous years' tx rises of 10% plus.

Surely they can't be allowed to do this. How about making up the shortfalls by sacking the idiots who lost all the money in the first place?!

[bearwithasorehead]

2.6% isn't a hike when you compare it to previous years' tx rises of 10% plus.

Surely they can't be allowed to do this. How about making up the shortfalls by sacking the idiots who lost all the money in the first place?!

As has been mentioned by others in previous threads - frontline services will be cut, temps will be sacked, but the big earners will not be touched, at least in the short term. Our council is one of the lowest performers in the country across the board, raises CT by 5% a year, and is vilified in the papers every week.... and is reelected every local election. Don't underestimate the power of inertia.

[worzel]

I don't give a toss if it was on a govt list, any finance manager getting paid £60k+ should have realised what the fook was going to happen and pulled the money out of Iceland.

Couldn't agree more. And lets me honest, a lot of them were getting paid a hell of a lot more than that.

[scrappycocco]

They should cut back on spending and nonjobs instead of making the tax payer foot the bill, its disgusting.