Colchester: Council hit by £10 million shortfall

10:24am Sunday 13th July 2008

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PUBLIC services look set to be hit because Colchester's new council is £10 million down on its cash projections.

Overspends on major projects have lead to the crisis and now talks are underway in a bid to find a solution.

Anticipated expenditure has been exceeded at the firstsite:newsite gallery and the new community stadium.

The fall in the housing market also means the projected £3 million figure for the sale of Layer Road football ground will not be met.

And the council has had to pay out money to end the contract with Inspace Partnership which carried out repairs and improvements to council houses.

A precise breakdown of the figures has not been revealed but Paul Smith, Colchester Council's new portfolio holder for resources, said discussions are now underway to prioritise projects.

Mr Smith said: "We are £10 million down on the projected figures we had seen prior to taking over.

"Clearly is it going to have an impact across a range of council services and we are not going to be able to bring in changes as quickly as we would have liked.

"We are going to have to be prudent in managing what remains of our financial resources."

Mr Smith added: "We were looking at the capital programme of £64 million and seeing what can be done and what can be delayed and what economies we can make.

"We are also looking at what we can do in terms of financial management."

Mr Smith said the new administration - made up of Liberal Democrat, Labour and Independent councillors - was still committed to its top three priorities: improving recycling, delivering better front line services such as street cleaning and street wardens, and tackling Colchester's transport problems.

Mr Smith said: "We are looking to see if we can use money from developers to provide the infrastructure people want.

"We need to reduce car use in the town centre by providing a viable alternative."

He added: "We are disappointed to find the council finance we inherited to be in such a poor shape.

"We are now working with a list of options on how to prioritise future projects."