Nottingham City Council is extending a temporary legal job at a cost of more than £110,000 to help with the sale of assets as it tries to get out of effective bankruptcy.
The council has a significant in-year budget gap of £23m, and approved sweeping cuts on March 4 due to a separate gap of £53m in 2024/25.
Even with the cuts the council was unable to fill the gaps in its budgets, and therefore had to apply for Exceptional Financial Support from the Government.
So it could set a balanced budget, a loan of over £66m has been given to the council, but this must be paid back using money raised from asset sales.
Special permission has been given to allow the authority to use money from the sales for day-to-day operational costs.
The council has also been selling assets in a bid to reduce its overall debt and borrowing requirements.
The selling of property has been happening for a number of years under what is known as the ‘Asset Rationalisation Programme’.
According to a delegated decision document published by the council a temporary legal role is now being extended to help.
In total £110,686 has been allocated to the role.
“There is insufficient capacity in the legal team to fully support the Asset
Rationalisation Programme on top of business as usual work,” the documents say.
“The currently engaged locum is fully au fait with the council’s systems and continuation of their engagement is a pragmatic solution to the resource problem.
“Steps will still be taken to try and secure suitably qualified directly employed staff on temporary contracts but this has previously proved difficult in a challenging employment market.”
According to documents published back in January, a total of £64.1m has so far been raised through the asset sale programme.
Following the collapse of council-run Robin Hood Energy in 2020 and the resulting appointment of an improvement board, the Labour-run council adopted a ‘voluntary debt reduction policy’.
It was recognised debt was too high and the council decided to cease all borrowing for capital investments.
Instead, new investments are paid for through Government grants, such as Levelling Up money, or the selling of surplus property it no longer needs.
The council is now overseen by Government commissioners following their appointment in February this year, with the Department for Levelling Up, Housing and Communities having decided the pace of change remained too slow.
