Supporting schools through the impact of Liverpool Council’s energy contract mix-up could lead to the authority “robbing budgets aimed at the most needy”, according to its opposition leader.
Yesterday, it was confirmed that schools across the city would face a bill of more than £2m as a result of the city council’s error around its energy contract earlier this year. A litany of mistakes at the Cunard Building led to millions of pounds being added to the local authority’s bill. Council leaders were not informed that the electricity provider it was dealing with had withdrawn from the commercial market, leading to the council - and other city institutions including schools and the fire service - being placed on a far more expensive contract.
Cllr Tom Logan, Liverpool Council cabinet member for education and skills, told a select committee hearing last night that calculations had been made that determined that the additional amount faced by city schools now stood at £2.2m. The council has identified where that money will come from to help pay the shortfall and is working with the Department for Education to find a legal method to get it to classrooms as quickly as possible.
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Cllr Richard Kemp, leader of the Liberal Democrat group, said the council needed to consider carefully where it would find the money to settle the schools’ tariff. He said: “We are already facing £73 million of cuts in the budget documents that have gone out to public consultation. Some of those savings might not be achievable.
“Given that 68% of our budget goes to pay for adult and children's social care there are very limited places outside this where money can be found. Supporting schools to make up for the appalling mistakes of the council can only mean us robbing budgets aimed at the most needy members of the community or defying the government and reducing balances to a level that the commissioners would find unsatisfactory.”
Addressing councillors last night, Cllr Logan said the council working to get the money to schools was “good indication that the political will is there” but it “isn’t easy to get the money across.” The cabinet member added that he wasn’t able to provide a timeline for the funding but officials had been “constantly asking” the Department for Education for further information.
Cllr Logan said Theresa Grant, interim chief executive, and Ian Duncan, interim finance director had been working with the city’s legal department to get the financing sorted. The figure of £2.2m is lower than the original £2.8m estimate made by Mayor Joanne Anderson at a joint meeting of the finance and resources and mayoral and performance select committees last month to discuss the council’s £72m budget shortfall.
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