Shirebrook Town Council plunges into debt
(IMPORTANT NOTE- please read EDIT at the end of article; all strikethrough information is not correct)
Shirebrook Town Council (STC) is trying to secure a loan for 50 years. The yearly repayment installment? £30 000. (Unknown) If you are good at maths, you can easily see that the total amount of the loan is £1 500 000 (about 600 000; read edit at the end) and the last installment will be paid (in the form of taxes) by your grandchildren…
You are probably wondering what such a small town as Shirebrook needs such a huge loan for. It also made me wonder and thus I decided to ask around. The answers I got made my hair stand on end.
The Labour Party who is in charge of the town decided to seek the loan already in 2016. Despite the fact that I am interested in local affairs– I have never heard about it before. During the recent local elections, the Labour Party didn’t even say a word about it in their election leaflets. Paradoxically – despite the fact that such a decision was made a few years ago – STC hasn’t yet received this huge loan. However, if you think that this stopped Labour Party politicians from spending that money – you are deeply mistaken.
The lack of money was never an issue for the Labour Party. Socialists simply borrow money from a different source.
STC has already started spending money which they do not have by taking out another loan to cover the expenses which were supposed to be paid with the first loan. At the end of the day, the current loan is meant to repay the previous loan. Yes! You have read it right! They didn’t get the loan but they already spent the money. Spent it on what? At present, I only know that the loan which is to be used to repay the previous loan, was incurred to build new Town Hall. But something is not quite right here…
They didn’t get the loan but they already spent the money. How much?
How much did the new Town Hall cost? Do you know? No? Me too. Council ignored all but one of my e-mails about it. (EDIT- I received answers on 15th of April) Those of you with inquisitive nature who monitor the town budget published online probably noticed the amount of 450 000 in the column ‘loan’. From what I managed to find out, this was a loan taken out to pay for the new Town Hall pending the ‘proper’ loan for this purpose. However, if the loan of £450 000 was taken out and the new Town Hall building was built with this money – then why is the new loan for one and half million pounds?
This reminds me of a debt rollover – something that led the last Labour government to fall when it turned out that the country’s annual deficit was £152 000 000 000 and all new loans were taken out only to repay the previous ones and that there was no money left for anything else. Fortunately, the Conservative Party won the election at the last moment, made some difficult but right decisions and today instead of a Greek-style crisis we can enjoy stability with great prospects for the future. Let’s however go back to the local affairs…
To be honest, I came across this information by sheer accident – it was my day off and it just so happened that on that day the Town Council had one of its most important meetings (concerning the approval of the budget for the next year). I went to that meeting only to find out whether the Labour Party once again voted in favor of a tax increase. There was no surprise at all– the tax will obviously go up since I am guessing that the previous 6 tax increases in the last 7 years were not enough. This also reminds me of the times under Blair’s and Brown’s government – a tax increase followed by another tax increase; increase of excise duty on beer and fuel as well as no attempts to cut expenses in order to save the budget that was about to collapse.
Have you already forgotten how the unemployment rate went through the roof and how people were losing their houses as a result of Brown’s decision to deregulate banks? I bet you have already forgotten the fear of what the future will bring that could be felt in 2008. Let’s however go back to the local affairs…
Will you be surprised when I tell you that the financial reserve of the town has reduced by 50% in the last year and the town is on the verge of financial meltdown? But it is a topic I will tackle in another article….
In the meantime, since I have not received an answer to my questions from STC, I will publish them here and then I will send them to all Councilors in my constituency. (my comments for readers in brackets)
Question 1: At ordinary full council meeting (29th January) I made my own notes. I wrote down that PWLB loan is 50 years long with 30 000 GBP yearly repayment. (EDIT– figure 30 000 was mentioned but without noting that this figure is limit- not actual repayment amount). Did I made a mistake in my notes or was I right? (PWLB- Public Works Loan Board- a statutory body of the UK Government that provides loans to public bodies. And yes- I made a mistake.)
Question 2: If I was correct- does sum 30 000 include interest and fees? (I went through PWLB website and I found tables with interest rates. I’m no expert in this subject but if I’m right- it looks like STC trying to take 50 year loan with 3% interest rate for… no one knows what! I can be wrong on interest- please come back if you want to know it- somehow I will get that info.) EDIT- 3% interest rate does not apply here. I will check with PWLB for actual interest on STC loan.
Question 3: I’m not sure (it’s not in my notes) but I think someone mentioned that PWLB loan was originally destined to be used as capital to build new Town Hall. Since town still didn’t obtain PWBL loan- where the money came from to build it?
Question 4: I found 450 000 loan on last year financial statement. What was the source of this loan? What is the interest rate on this loan? (Btw: why Labour didn’t mention those loans in election leaflets??? Why they didn’t tell the electorate that they will plunge town into huuuuge debt??? Also- there is not a single mention of those loans in all The Post issues I read… Why The Post hiding this fact???)
Question 5: I’m not sure now (it’s not in my notes) but I think I heard that 450 000 loan was used to build Town Hall while STC waited for PWLB loan. Is that true? (I was almost sure I heard it but more I think about it- more crazy this looks. They didn’t secure funding so they went somewhere else and borrowed money on the account of the loan not yet received???)
Question 6: If that is true- who made decision to go for other loan before PWLB loan was secured? (Was there a vote? Why The Post didn’t print that on the first page?? This loan is three times bigger then yearly tax income of town. This is huge and no one knows about it. INSANE!!!)
Question 7: If that was true- why there is such a huge difference between PWBL loan and loan used to build Town Hall? (PWBL loan is 1.5m GBP; loan on Council books is 450k. Something does not add up here…)
Question 8: How much did the construction of Town Hall cost exactly? (Dear reader- I dare you to find that information. It’s taxpayers money- it should be transparent. But it’s not…)
Question 9: I went through several issues of The Post to find any information about cost and ownership details of the building. I found nothing about cost and to be honest I found conflicting information about ownership. In one of the issues journalist claim that building is a joint venture of Bolsover District Council and STC, in another issue I found information that building is owned solely by STC. Who is the owner of that building?
Sylwester Zwierzynski
EDIT– on 15th of April I received answers for my questions about this loan directly from STC. 30 000 figure is limit- not actual yearly repayment. The actual amount of loan is not 1 500 000 but little about 600 000 pounds, so yearly repayment will be lower. There is so much additional information that I have to write new article about it.
Lead photo by Lensicle’s bio – www.lensicle.com, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=51611734
