An official Council report has revealed that Luton Borough Council significantly underspent against the annual Budget in the year up to March 2012. Despite this, the Labour Council was among a tiny minority to hike up Council tax in their February Budget, by 3.44 percent.

Liberal Democrat enquiries have also revealed that, after various top-ups through the year, the Council is sitting on £51,449,575 in Reserves. Around £20 million of this rightfully belongs to Schools, or is for Housing Repairs or other Capital and building projects.

The remaining £31.4 million, which is available for ongoing revenue/ service commitments, is kept in a multitude of quaintly named pockets such as the “Reorganisation Reserve”, “Recession Reserve”, “General Risk Management Reserve”, and two Insurance Reserves. £14.7 million is allocated to “reorganisation” alone.

The position is detailed in a report to Luton’s Labour Executive due to be scrutinised by the Finance Review Group on Monday night.

Despite continually claiming to be in a weak financial position, Luton Council receives an average of £434.61 a head from the Government in Support grant and Business rates, compared to £183.53 a head going to neighbouring Central Beds and £317.65 to Bedford.

Liberal Democrat Deputy Group Leader, Martin Pantling says:

“ Given the noises coming out of the Council, and the plan to spend £120,000 on a so-called Budget consultation exercise aimed more at bemoaning their lot than giving residents real choices, people will be surprised to hear Labour are sitting on over £51.4 million of reserves.”

“ The sheer scale of the money tucked away adds insult to the injury inflicted on residents in February when Labour rejected a £1.6 million Government grant, then charged local people an extra £2.2 million for their pet projects and wasteful approach.”

“ With over fifty one million pounds in reserves, more money per head coming in from the Government than neighbouring Councils, and another underspend last year, it’s clearer than ever that Labour have no need whatsoever to be raising Council Tax.”