Council with £21m black hole says 'with hindsight' it would not have spent £2m cleaning borough

The fund was promised to tackle issues like flytipping
-Credit: (Image: Andrew Teebay Liverpool Echo)


Wirral Council said it would have likely withheld funding to clean up the borough if it had known it was so close to possible bankruptcy. The local authority spent an extra £2.2m improving green spaces, replacing litter bins, and cleaning more streets this year but now faces a £21m budget black hole.

In February 2024, Wirral Council unanimously agreed to spend £2.2m in its budget on “specific improvement activities that will have a visible impact across the borough.” Councillors said it would “tackle things people complain about the most" and “help us get the basics right.”

The fund saw among other things £100,000 spent on gully cleaning, £300,000 spent on tackling the worst affected areas, and £300,000 to create new pollinator sites. The council said streets in Wallasey, Birkenhead, New Ferry and Meols were all treated early on in the project with the likes of fly-tipped items, furniture, general waste, and weeds being removed.

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However in July, councillors questioned how the “campaign to get the basics right is going" following complaints about weeds. The council's leader Cllr Paul Stuart said he would take up the issues with the service, adding it was additional money, not what should already be done by the council’s contractors.

During a discussion of a budget update report on the current year at November’s policy and resources committee meeting, Cllr Liz Grey raised questions about the funding given the council’s budget position. It is currently expecting a budget black hole of £21m this year with a further £36m gap next year.

Decisions around the funding were made by the council’s finance sub-committee, a smaller group made up of party leaders, that doesn’t meet publicly. Cllr Grey, who is not a member of that committee, said she’d “suggested that it went into reserves because I could see a black hole ahead of us.”

She asked for clarification about why the council was able to spend the money before it brought in a spending freeze in September and why the funds weren’t set aside as backup funds to support the budget. The spending freeze called for a halt on all non-essential spending within the council.

In response, the council’s finance director Matthew Bennett said the budget was "set in good faith that this was the situation that we had and it was forecast on the basis that we could produce a balanced budget from that point in time.

“By the time the monitoring came through which started to show these vast increases in costs and demand within adults’ and childrens’ services, we introduced a spending freeze which then impacted on the environmental improvement fund as well."

However he said a lot of the money had already been contractually committed, adding: "Hindsight is a wonderful thing and I too probably would not have accepted that money being put forward even as a one-off if I had known the position was going to reach this point.”

Budget reports from February 2024 did show the council was expecting to balance its budget by March 2025. However papers before the Policy and Resources committee at the time show it was projected to go over budget by nearly £9m for the financial year between April 2023 and March 2024.

Papers published in July said the council went over budget last year by £10.7m in the end and would face a £3.1m budget gap from April 2025. This is now expected to be around £36m as Wirral, like many councils, struggles to deal with rising demand in social care services.

Cllr Grey said she wanted assurances committees “have full oversight over not just the policymaking but also the spending, the budget, and also where the savings might go as well.” She asked for committee chairs to be included going forward given the funding was largely related to her committee which oversees the council’s environmental service.

Wirral Council leader Cllr Paul Stuart said they would. Cllr Grey also raised concerns about a review of an environmental assessments contract and asked the council to “just make sure that we are not laying ourselves open to any kind of litigation or fines because we haven’t made the appropriate decisions.”

She added: “We’ve got very very complex environmental laws that we need to navigate, national and international, and I want to make sure we’re not losing money in the long term by trying to save money in the short term there.”

It was recently found the council’s clearance of vegetation on West Kirby beach failed to comply with environmental protections for the area. The Office for Environmental Protection said it does not plan to investigate further but will monitor closely both Wirral Council and government body Natural England going forward.

On the subject of fines, Cllr Stuart said: “Quite frankly if we end up with any fines, if we’re bankrupt, then we can’t pay the bills anyway so it wouldn’t make any difference what fines we get.”