Wednesday, 30 April 2014

Cuts! What cuts? Here's one area of council spending that will increase every year until 2028

One area of Wrecsam Council spending that will increase regardless of the cutbacks is the waste disposal department.
 Because a 25-year Public Finance Initiative contract with the WRG group was signed in May 2007 after many years of negotiations.
 This contract came into force in April 2009 and the true cost of the controversial scheme has always been hidden behind closed doors. Councillors were forbidden to discuss the cost of the contract, which contracted out the refuse and waste disposal service, because it was always a Part 2 item on the agenda.
 However, tucked away on page 31 of the council's accounts for 2012-13 is the financial detail:

 In the first year, the council paid £12,728,000 to WRG.
The annual cost in the subsequent years increased dramatically.

2010-14   £12,873,000 a year
2015-18   £14,806,000 a year
2019-23   £16,513,000 a year
2024-28   £18,407,000 a year
2029-33     £4,908,000 a year

By the end of the contract in 2034, the council will have spent £332,500,000 on running the waste disposal service in the small borough. That figure could increase if inflation rises because the contract is not capped.

 PFIs are now discredited but were all the rage during the 1990s and early 2000s as first the Tories and then Blair's Labour government sought to offload public debt onto future generations. In the process they guaranteed huge and ongoing profits for big business.

 They saddled councils like Wrecsam with huge and ever-growing annual payments, which will be made all the worse as every other aspect of the council's budget has to be squeezed dramatically. And it's not as if we didn't warn you... Plaid Wrecsam has been on the case of the PFI scandal for the past four years.

 The council officers who recommended this deal and the councillors daft enough to back it should hang their heads in shame. They have saddled a whole generation with a huge repayment that will make the provision of other key services much more difficult in the coming years.

UPDATE: Councillor Neil Rogers has pointed out that he was not leader of the council in 2007. 

1 comment:

Cllr Neil Rogers said...

I am concerned by this article in which you make reference that I signed a 25-year contract with WRG group in May 2007.

This statement is factually incorrect and untrue. Your comments are very hurtful to me personally and as a matter of correctness you should have checked your facts before publishing inaccuracies.

The report, which went to council on the 26 February 2007, and the minutes of the council meeting for the same date will confirm that I was not the Leader of WCBC on the said date –

On Tuesday 27 February a special Executive Board was held to discuss the same matter. This also clearly shows that I was not the Leader of the council when this item was discussed -

Due to the numerous inaccuracies in the above statement, I am asking you to consider removing it immediately. I will also consider bringing this to the attention of the local government Ombudsman as well as my legal representative.

Cllr Neil Rogers