A cash-strapped Derbyshire town council has so far successfully managed to halve a £400,000 debt with a series of money-saving initiatives after it had been criticised by a damning report which had highlighted financial shortfalls.
Staveley Town Council had been forced to accept a Chesterfield Borough Council loan in February, 2023, to prevent bankruptcy and the two authorities – together with the Local Government Association and National Association of Local Councils – appointed an investigative Improvement Board to establish the causes of the insolvency, monitor the town council’s progress and advise upon its future.
But more than two years later the town council has managed to reduce this debt by half with measures including reluctantly introducing redundancies, relying on volunteers, stopping some grants, giving up its licence to hold the town centre markets, closing its cafe, cancelling unnecessary contracts, bringing utility costs under control and by getting rid of hanging baskets.
Town Council Clerk Sabrina Doherty said: “When we took the loan out we made all the staff redundant apart from myself and the caretaker which was a massive reduction.”
Staveley Town Council also transferred its cleaning staff over to another organisation under TUPE regulations to ensure that these jobs could be transferred to a new employer.
The Improvement Board’s report had highlighted financial shortfalls over more than ten years between 2011 and 2022 and the 2011/12 to 2019/20 administration oversaw problems including HR issues, cost overspend, lost income, and lost grant opportunities which led to a structurally financially imbalanced council by the 2019/20 election and subsequent insufficient action led to the authority’s financial failure.
Staveley Town Council accepted the board’s findings into its previous financial management including its operations, finances and governance arrangements between 2011 and 2022 and the board recognised councillors wanted to make the authority more effective and they praised the new and current town clerk as a more effective partnership between councillors and other authorities was encouraged.
The council successfully introduced a new financial system under the current clerk, according to the report, and it began following recommendations outlined by the board as well as reducing expenditure to pay off its debt.
Chesterfield Borough Council’s loan covered the town council’s outstanding revenue debts from lost income but it did not cover all the authority’s full debts and it needed to make £500,000 of savings for the two years on top of its continued efforts to meet the £400,000 loan and interest.
Ms Doherty said: “The only thing we could reduce in bulk was staffing cost so we have had volunteers and my own family coming in and helping and it has been an extreme and stressful situation.
“We have three buildings we manage and quite a few services and we knocked out a few things including hanging baskets and grants.”
The town council also decided to give up its licence to hold Staveley’s town centre market due to costs, its lack of income and over worries about the impact of the borough council-led Staveley Town Deal regeneration scheme because the market had been costing thousands of pounds per year to staff while costing residents in Business Rates.
It also claimed the market had become temporarily unusable due to access restrictions and with traders losing confidence following the announcement of a new Pavilion building scheme and construction work as part of the Staveley Town Deal Staveley 21 Project overseen by the borough council but this may be reviewed once the ‘Market Place is back in business’.
The council has managed to make four repayments to the borough council in two years to pay off half of the £400,000 loan and plans are in place to keep making two payments a year to eventually pay off the whole debt including interest and it has also completed the last payment on a separate £75,000 loan to the borough council from 2020.
Ms Doherty added: “It’s not been good to do what we have had to do but it has been a necessary evil to get us back on track.”
But the town council has already seen improvements with its finances, governance and operations, according to Ms Doherty, backed up by its internal audit check boxes after they had been wildly off track but they are now deemed to be healthy, structured, organised and controlled under a local council accounting system with budget monitoring.
The town council has also established working relationships with the borough council at officer level to better understand business rates and it has been working with the Derbyshire County Council’s highways team recently to help a Woodthorpe Community group secure a rewilding scheme at a disused layby.
An assistant clerk for communications and marketing at the town council is also helping to provide and disclose more website information online and on social media about the council’s finances to further regain public trust and confidence and a display at an annual town assembly meeting showed its continuing progress from the 2024/25 financial period.
Ms Doherty said the town council made savings so it could afford to keep paying loans and so this would not affect the council tax precept for residents which only increased to cover national inflation costs.
She added that the council’s current ongoing debt is controlled and under scrutiny and surveillance and not ‘out of control as it was before’.
The council is also hoping to achieve a National Association of Local Councils’ Local Councils Award Scheme bronze award which recognises governance, community engagement, and service delivery and helps provide a framework for councils to improve and develop.
Its financial position has become so much more stabilised it has recently been able to award over £34,000 of funding grants towards community groups and projects with contributions from Community Infrastructure Levies paid to the authority from developments in the area and from ‘Small’ and ‘Large’ funding pots as well as from a ‘Small+LB Solar Farm fund’ linked to solar farm projects.
Ms Doherty said: “If you look at the difference in staffing structure, we used to have 17 bodies delivering the council’s services and we are still delivering these services and more with a vastly reduced staffing structure.”
Councillors have also been benefiting from training and workshops on subjects including planning, human resources and finance and from a visit from a representative from the Derbyshire Association of Local Councils.
Ms Doherty said some of their councillors have over 20 years of experience but there have been vast changes in legislation so it has been important for the council to keep up to date.
The Improvement Board’s review of the council – only six months after the publication of its report – was also largely favourable because its improved audit reports showed that the council’s finances were back on track, according to Ms Doherty.
She added that the board set the council a target of achieving £50,000 for its General Reserves and the council achieved over £100,000 by the end of that particular year.
Ms Doherty also pointed out that by the end of the 2022/23 financial year the council had spent over a million pounds but by 2023/24 after introducing a new structure it spent less than £500,000 which showed the extent of the reductions it has successfully introduced.
