Dorset's councils have £330m in reserves - so why are they cutting services?

The amount of usable reserves has been described as 'madness' by one councillor.

The cash stacks up as follows (figures for April this year):

*Dorset County Council £101,322,000

*Bournemouth £85,397,000

*Borough of Poole £59,014,000

*East Dorset £13,050,000

*Christchurch £9,308,000

*Purbeck £7,054,000

*West Dorset £35,108,000

*North Dorset £7,051,000

*Weymouth and Portland £12,774,000

*Total £330,078,000

Steve Lugg, who is a member of both East Dorset District Council and Dorset County Council, told the Echo: "It is madness to have all this money sitting around doing nothing. It's very frustrating when so much could be done with it and all the councils are pleading poverty.

"There is a culture that dates back to the 1970s which is all about hanging on to reserves.

"We are in a different world now and the council leaders don't understand the business."

Cllr Lugg added: "How on earth can councillors go to the government and ask for money when they have all this cash in hand?"

In a email to colleagues, Cllr Lugg wrote: "Savings or council reserves are surely rainy-day funds, collected from the tax-payer? Well, let's look out the window because it's pouring down, here in the real world.

"Wake up and empty the piggy bank please."

He also said the public was not being given the real picture on council finances.

The current plans to merge the nine councils into two have been brought forward because of what the leaders say is a dire financial future without radical change.

However, Christchurch MP Chris Chope said: "These reserves are only part of the picture.

"The assets are also significant as well.

"Christchurch has assets of £55million, absolutely massive.

"All the councils have got the ability to resolve their own financial problems themselves and this talk about necessity dictating the abolition of the councils is a ruse to exploit the ignorance of the public.

"They are trying to make it far more complicated than it needs to be.

"I hope the scales will gradually be removed from the eyes of the councillors and they will wake up to the stark reality of this."

A meeting of Christchurch council last week heard about the amount each authority has in assets.

Members were told Borough of Poole has £625m, Dorset County Council has £817m, Bournemouth has £740m, East Dorset £26m, North Dorset £14m and Purbeck District Council £10million.

Responding to the comments, county council leader Robert Gould said use of reserves was highly regulated.

"The way councils manage their reserves is strictly legislated," he said.

"There are rules on what reserves can be used for and what they can’t be used for. The government has acknowledged the difficult times faced by councils and is considering future options."

Bournemouth council leader John Beesley said: "I’m afraid it is misleading and inaccurate to suggest that the gravity of the financial challenge facing councils can be addressed through the use of council reserves, either alone or indefinitely."

He said the authority only has "unallocated reserves" of £8.1m, which has been used "to smooth the financial position in the past, this year and into the future".

He said reserves had been used to top-up "demand-led" adult social care and children's services funding, and had to be available to make up for in-year government grant cuts or to cover the costs of responding to an emergency.

"Proposals for local government reform in Dorset being put forward to all councils by the six chief executives are a response to the financial challenges.

"Whilst these have been the catalyst, the prize that the evidence shows is available to Dorset if we are collectively ambitious and aspirational enough, is very much greater.

"It is a very great pity that those who should be championing their residents’ best interests appear to be turning their backs on this opportunity to improve services, generate economic prosperity for the area and ensure a sustainable future for public services in the county."