Union calls for government to bail out cash-strapped Thurrock Council and save jobs - meanwhile leader defends controversial borrowing strategy that created £1.4 billion debt mountain

By Neil Speight

25th Nov 2021 | Local News

A CALL has been made for the government to bail out 'floundering' councils – including Thurrock where union officials are battling to save the jobs of up to 250 people.

This week Thurrock Nub News exclusively reported on a meeting where its finance chief confirmed between 200 and 250 people currently in work would lose their jobs in the coming months as the council tried to cut a huge deficit in its budget.

Finance director Sean Clark declared 'no one is safe' as he revealed the total number of full time jobs lost would be around 500 as the council would not be filling many of its current vacancies.

Effectively the council workforce will be cut by a quarter in 2022.

Mr Clark said he was not sure if the appropriate notification had been made to unions, including Unite, GMB and UNISON, to which many of the workers facing the loss of their jobs belong. It is a legal requirement that such notification - known as a HR1 - be made, though it appears it hasn't formally happened yet. Notification has been given for jobs already targeted under a current restructuring programme.

A spokesperson for UNISON said: "UNISON has received HR1 notices for restructures and redundancies this financial year and has been working with the council to minimise staff cuts and damages to services. We are already in talks about the further cuts expected next financial year but have not yet received a formal HR1 notice."

The union says it has some sympathy with the council and has turned the spotlight on the government for a lack of support for local authorities across the country.

UNISON Thurrock branch secretary Peter Sansom said: "Thurrock Council is staring into a financial black hole as it struggles to balance the books through Covid and the totally insufficient support from central government.

"UNISON has been working flat out with the council to minimise job losses and the damage done to services. But the sad reality is Thurrock's coffers are empty and there's no fat left to trim.

"The government quite rightly poured billions into furlough to keep heads above water in the private sector but it has left local councils floundering. Unless there's an urgent cash injection from Westminster then jobs, services and whole communities in Thurrock and elsewhere will go under."

Thurrock's Conservative council leader Cllr Rob Gledhill has defended the council's job cut plans and said the council was faced with a big task to balance the books.

He has also denied that part of the problem facing the council is due to its controversial 'borrow to invest' strategy that at one point took the council's debt mountain to £1.4 billion.

Though Cllr Gledhill continues to fly the flag for its controversial policy, which is now being wound down, in real terms very little is known about the mechanics of it and the council has fought a long and expensive legal battle to keep its dealings a secret.

An appeal it has made against an information tribunal decision ordering it to go public is not expected until the new year.

And in recent days the council has further declined to answer detailed questions posed by Thurrock Nub News about fears that it could lose millions of pounds as one of the companies it has invested in is in significant financial jeopardy.

Much of the £16 million Thurrock pumped into Pure World Energy was used by its directors to invest in other companies, not the renewable energy creation Thurrock thought it was investing in! Pure Worl Energy has warned its investors it has had to delay paying back investments – and its accountants have warned that may not happen at all.

However, Cllr Gledhill remains adamant that the council's investment strategy has been a positive, not a negative and that it has helped offset the council's current financial plight, not add to it.

He says: "Following Covid and forced reduction in our investment strategy the council has seen a massive increase in demand for services at the same time a significant decrease in income.

"We must remember that our investment strategy easily pays the interest on our debt as well as brings in over £30m of income to spend on services.

"This is over £30m we do not need to ask the taxpayers for and was made clear at the meeting by officers. With Thurrock having the third lowest Council Tax of any unitary authority, and because of limitations in the amount we are able to increase Council Tax, we have to look to change the way and what services we deliver.

"I am sure that no one, other than the Labour leader, forgets we inherited a deficit of £40m from Labour when we took control of the Council in 2016."

Cllr Gledhill added: "We announced in August that Thurrock would be changing the way it provides services and to rise to the challenge of the £34m deficit over the next two years, most of which has now been identified.

"This includes reducing the reliance on costly agency staff, over 200 vacant posts would be removed or used to protect existing staff, alternative and creative funding sources found for others but there would still be some job losses.

"To put Thurrock's pay bill into perspective, Thurrock currently pays £98m per year in salary, so for every one per cent increase in salaries we have to increase council tax by 1.4 per cent and this is not sustainable.

Officers are going through the process of presenting how services will be delivered going forward and where job losses do happen staff are fully consulted with and supported."

Labour leader Cllr John Kent is less than convinced about the council's position and the veracity of its statements. He says: ""We have known for some time the extent of the financial crisis at Thurrock Council - there is a black hole of £34 million that needs to be filled over the next two years.

"It was shocking to have it confirmed that this will mean hundreds of hard working council staff will lose their jobs over the next few months - these aren't just statistics, they are all people with families and other commitments who are now facing a very worrying time.

"It is shameful that not a single Conservative member of the committee had anything to say about these job losses at the corporate overview and scrutiny committee as Mr Clark confirmed the news. There were four at the meeting and the silence was deafening.

"The Conservative investment strategy has saddled the council with debt interest payments of £16 million a year and it is clear that Thurrock Conservatives have completely lost control of the council's finances."

     

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