MILLIONS of pounds raised by Bournemouth council through the sale of various facilities and land has been used to fund the redundancies of hundreds of its employees.

The authority has used £2.7 million raised through the sale of a number of public assets to fund more than 200 redundancies, figures obtained by the Bureau of Investigative Journalism reveal.

Over the last four years it has sold 21 buildings or pieces of land, raising more than £4.5 million.

Prior to 2016, local authorities were restricted to only being allowed to spend money raised by selling off assets on paying for replacements.

However, the introduction of ‘flexible capital receipts’ three years ago allowed councils to use the proceeds to fund cost-cutting measures.

About one-fifth of local authorities have since made use of these new powers and two-thirds of these have used them specifically on staff redundancy packages, including Bournemouth council.

Since 2016/17, it has used £2,667,942 of capital receipts to fund the redundancies of 201 of its employees.

Neither Poole nor Dorset County council have made use of the proceeds of asset sales to fund redundancies.

Bournemouth council has raised capital receipts through sales of public assets including a £1 million deal with the Laguna Hotel for land at Suffolk Road South and the former Winton Fire Station building.

Cllr Philip Broadhead, cabinet member for property, said: “We have been investing in new assets across the town, both to increase our asset base and to generate income.

“From 2014-2018 the value of assets sold, many of which were surplus to requirements, has been more than outstripped by new assets acquired.

“At the same time, these new assets are generating a healthy return which is used to protect frontline services.”

Birmingham council has been the most prolific user of the new powers, having spent £23 million in capital receipts on redundancies.

Cllr Richard Watts, chairman of the Local Government Association’s resources board, said that the more relaxed rules around the use of money raised through asset sales had allowed councils to avoid having to use their reserves.

“Between 2010 and 2020, councils will have lost almost 60p out of every £1 the government had provided for services,” he said.

“With staffing being one of the biggest costs for councils, this has led to the number of people directly employed by local government falling by almost a third in 10 years.

“Having been given the flexibility, it has made sense for some councils to use capital receipts while they can to manage this substantial transformational change.

“This has allowed them to avoid running down the reserves which helps them try and manage the growing financial risks to local services.”

The Bureau of Investigative Journalism’s figures show that nationally £641 million was generated by councils through the sale of assets in 2017/18.