Margaret Thatcher once quipped, “The problem with socialism is that you eventually run out of other people’s money”, writes leader of the Labour group on Peterborough City Council, Cllr Shaz Nawaz, in his weekly column.
This quip is dry, humorously stated, and wrong.
After all, capitalism did a spectacular job of running out of money during the financial crash of 2007/2008.
Furthermore, it seems that our Conservative council is hell bent on creating a new adage; the problem with them is that they are running out of money, period. Worse, they do not know what to do about it.
As has been recently reported, the council presently has a budget gap of £23 million. This is far higher than the initial £18 million figure which had previously been published. A sweaty odour of trouble arises immediately: they didn’t know where they are financially. Most of us would be in dire straits if we mismanaged our personal finances so badly.
It’s not as if the Conservative administration hasn’t known the direction of travel: we’ve been bearing heavy budget reductions since 2010. Little, apart from swingeing cuts and short-term patches have been implemented. Worse, they’ve apparently run out of ideas despite having highly paid officers who are ostensibly hired to solve the problem.
Nevertheless, costly errors continue. Most recently, the council’s abrupt switch from Google to Microsoft technologies has proved to be expensive. The council has brought in Grant Thornton, the large accountancy firm, to advise on what to do. This is not cheap: it could cost a million pounds. At the Audit Committee meeting on March 25 the Labour group asked about the high cost of using consultants.
We were assured the use of consultants would be reduced; we did not know about Grant Thornton’s commission, this was hidden. Now, in the best-case scenario, we will be paying a great deal to Grant Thornton to tell us what we should have done in the first place. This is the optimistic outcome: we could end up with an expensive bill for services which do not improve our city’s fiscal health.
Furthermore, we could have done much of this work ourselves; there is a time for using outside consultants, but in this instance, it appears to be a sticking plaster, hiding the fact that the Conservative administration has run out of ideas.
We could have saved at least some money by working harder ourselves: we should have started by speaking to other councils which are performing better than we. The money saved could have been spent on social care, children’s needs, and other much needed services.
Even if Grant Thornton do an exceptional job, and they may, I wonder: will the council implement their suggestions? I have my doubts. The administration may very well be simply buying time until May 2020, when it is likely they will no longer be in power; they will leave it to others to clean up the mess.
We will: but it’s just as important that we remember how we got into this trouble in the first place.