Those six councils who took the government to court over its decision to axe Building Schools for the Future have won their case. The judge found that they had not been properly consulted, and ruled that Michael Gove must reconsider.
Here's a report of the news from the BBC.
Our own council, Barnet, like the good loyal Tories they are, found reasons to welcome the axing of Building Schools for the Future when it happened even though they had already spent/wasted money preparing for new school buildings that would now never be built.
They should have appealed too... as we were saying back in August.
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11 comments:
Barnet can’t build the schools even if they wanted to because they borrowed the capital required from the Public Works Loan Board and then ‘invested’ it all in Iceland, trying to make 2% on the turn. Now wasn’t that a clever move.
Was that a specific strategic move then - by Mr Mike Freer?
I assumed that the Iceland money was "loose change", that is, just short-term cash at the back of the till.
Dave,
Well done for reminding us about the 'gambling' money and to baarnett for pointing to the punter/banker 'hedging' his bet. Had they got away with that Coleman and the rest of the Tories would not be calling for an end to local democracy. Not the architect who got to Parliament but the architect of all manner of flawed punts, who did get there. Conservative integrity!
I thought it was unlawful for Councils to draw down borrowed funds to speculate with them. Is there a reason why this was never challenged legally?
I would also love to understand more about why so many Tory councils who lost money in Iceland chose ex Tory party treasurer Michael Spencer's firm Butlers to advise them.
Council are allowed to ‘invest’ money that is not immediately needed, but only for the short term. However, the legislation does not define what short term is. Barnet borrowed the money from the PWLB two years in advance of it actually being required. How many people would consider two years to be short term?
In my opinion, Jaybird, this should have been challenged legally but no private individual has the resources to take on Barnet Council. History has proven that they will spend hundreds of thousands of pounds on expensive lawyers to defend their own.
Ahhh! the ambiguity and the drafting of rules and the Languages of Law and Politics.
True, most indviduals would not afford the minimun £10k to take on a public body but there are other ways of holding the council to account without resigning, according to one mouthy principled Tory ex-councillor who enjoys beating his former friends.
What is the Public Works Loan Board? It's an archaic sounding title!
http://en.wikipedia.org/wiki/Public_Works_Loan_Board
Aha! Established in 1793.
Don't we have to pay them back some time? The £27 million, I mean.
There's a lot more people in front of Barnet and probably take a long time. Just to give you an idea,
http://www.icenews.is/index.php/2011/02/11/over-100-under-investigation-over-iceland-bank-crash/
http://www.icelandreview.com/icelandreview/daily_news/?cat_id=29314&ew_0_a_id=373765
http://www.icenews.is/index.php/2011/01/20/more-icelandic-bankers-arrested/
Yes the money does have to be repaid, but the interest rate charged by the Government is lower than would be available to Councils on the money market. This is where the opportunity to make a profit on the interest rate differential arose. Most sensible councils, however, understand that their raison d’etre is to provide services for local residents, not to play at being bankers.
Can someone get this in "Private Eye"?
(Or has it been in already? - someone told me Mike Freer was made "Banker of the Year"! Does anyone have a reference?)
"Banker of the Year" "bankers"
With my hands in the shape they're in, it's the kind of typing error I make
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