Labour Assembly Government's £1.5 million eleventh-hour budget hammer blow for Cardiff

February 21, 2007 11:25 AM

UK Money - notes and coinsMembers of Cardiff Council's Liberal Democrat executive are furious at a last minute announcement by the Labour Assembly Government that the council will be provided with £1.523 million less funding than had been anticipated for the coming financial year.

The news has come after the council's executive has already agreed on budget proposals to recommend to the full council for endorsement this week based on the assumption that the council would receive £3.4 million of funding under the Local Authority Business Growth Incentive (LABGI) scheme, a grant given to local authorities since 2004 to encourage them to promote the development of new businesses.

However, the Assembly Government has now advised Cardiff Council that there will be significantly less money available in the LABGI scheme for Welsh local authorities in 2007-08, meaning that the city will receive only £1.877 million. This means the council's executive is now being forced to cut £1.523 million from its budget proposals.

Council leader Rodney Berman said: "This is a shambolic way to manage public finances. Not for the first time, the council's budget proposals are facing uncertainty because of what appear to be last minute political shenanigans coming from the Labour Assembly Government.

"Both the First Minister and the Finance Minister represent Cardiff constituencies and, yet again, they are letting Cardiff people down by forcing swingeing cuts upon us. These cuts will inevitably lead to poorly-funded services for their own electors."

Executive member for economic development and finance, Mark Stephens, added: "Once again the Labour party is treating the capital city with contempt. We know that they have lost control of their own finances, with the Labour Assembly Government having recently announced it has under spent on its own budget in the current financial year by around £67.5 million.

"Labour should now use some of these unspent millions to plug the gap in the money they are taking away from Cardiff. I call upon Sue Essex to make an urgent announcement to say that she will put this right and not leave her own constituents short-changed to the tune of £1.5 million."

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