Concerns about Gloucester City Council’s financial instability affecting local government reorganisation in Gloucestershire have been firmly dismissed by the council’s leadership.
Faced with a funding shortfall of between £12.5m and £17.5m, Gloucester City Council has applied for emergency financial support from the Government to avoid issuing a section 114 notice. While councils cannot officially declare bankruptcy, issuing this notice would freeze new spending commitments, severely limiting the council’s financial flexibility.
Leaders have agreed to seek this exceptional funding, which will need to be repaid. The funding crisis comes at a critical juncture as plans to restructure local government in Gloucestershire advance. Currently, three proposals are under consideration by the Government to merge the county’s district councils with the Gloucestershire County Council, potentially creating one or two unitary authorities.
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During a recent special council meeting, questions arose about how Gloucester’s precarious financial position might impact these reorganisation efforts. David Redgewell, a member of the public, voiced concerns that a council in financial distress would complicate merging with other districts or integrating into broader regional authorities such as the West of England Combined Authority.
However, Jeremy Hilton, leader of Gloucester City Council and Liberal Democrat councillor for Kingsholm and Wotton, downplayed these worries. Hilton stated, “The current state of the finances of Gloucester City Council probably will have no impact on local government reorganisation as such. There’s still lots of work to do, but I don’t think there will be a direct effect on the three options the Government is considering.”
Gloucester’s leadership maintains that despite the financial hurdles, the plans to reshape local government across Gloucestershire will continue to progress without being derailed by the city council’s monetary challenges.