Austerity-hit council sold £30m of Bristol’s public assets

More than £5million has been spent on redundancy pay-outs for Bristol City Council staff – funded by selling off dozens of public spaces.

With local government funding slashed since 2010, councils across the country have cashed in on new freedom over how they spend income from sales.

A joint investigation by local democracy reporter Stephen Sumner and the Bureau of Investigative Journalism (BIJ) has revealed that between 2014 and 2018 Bristol City Council sold off 86 spaces, collectively worth just over £30million.

Figures obtained by the BIJ show spikes in the number of staff laid off after the so-called “flexible use of capital receipts” policy was introduced in 2016/17.

That same financial year, Bristol City Council spent £5.3million on exit packages for 401 people – ten times the number who left the authority in 2015/16.

It budgeted to use a further £5.1million in 2017/18 but “that was not called upon”.

Cheltenham Road Library was sold for £2.9m and has now been turned into houses. Photo from Google street view

Of the public assets flogged off by the council, those that fetched the highest values included:

• Land at the Port of Bristol to First Corporate Shipping Limited for £10million.
• Cheltenham Road Library to Md Homes (Hambrook) Ltd for £2.9million. It has now been demolished and replaced with houses.
• Wilder House to Juniper Homes (Wilder) Limited for £2.7million.
• The Muller Road bus depot to Lidl for £1.8million.
• “Surplus” land at Stile Acres, again to Lidl, for £1.8million.
• Maesknoll EPH to Bellway Homes Ltd for £1.6million.
• Burghill Road, part of the former Defra office, to the Master Wardens And Commonalty Of Merchant Venturers for £1.2million.

Wilder House was sold to a developer for £2.7m. Photo from Google Street View

Before the new flexibility was introduced in April 2016 by then chancellor George Osborne, local authorities had to put the money raised from selling assets towards other similar types of expenditure – proceeds could not be used to support day-to-day running costs.

Bristol City Council has only used the policy once so far.

A spokesperson said: “In 2016/17 the council was facing a significant budget shortfall and service restructures meant a reduction in the workforce – hence the higher number of redundancies. This was widely reported at the time.

“The £5.3million applied in 2016/17 would have been primarily to fund redundancies relating to transformation programmes – those which fundamentally change services to save money and deliver better outcomes.”

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Read more: City council passes more than £100m of cuts

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According to the Local Government Association, councils will have lost almost 60 pence out of every pound the Government had provided for services.

A spokesperson for the Local Government Information Unit said councils were in danger of having to “sell off the family silver to stay afloat”.

The Government said local authorities using the policy must “demonstrate the highest standards of accountability and transparency”. This means producing annual reports detailing the amount of money being spent, the projects funded and the savings targets set, but they do not have to include details of which assets were sold.

FoI requests found that 64 councils in England have spent a total of £381million made from property sales using the new flexibility since the policy came into effect. Almost a third of that, £115million, was spent on making people redundant.

South Gloucestershire Council has only used the income from capital receipts for “transformational change” and there are “no current plans” to use it for redundancies.

A spokesperson said it holds a separate severance provision for such costs.

Richard Watts, who chairs the Local Government Association’s resources board, said: “Between 2010 and 2020, councils will have lost almost 60 pence out of every pound the Government had provided for services.

“With staffing being one of the biggest costs for councils, this has led to the number of people directly employed by local government falling by almost a third in 10 years.

“Having been given the flexibility, it has made sense for some councils to use capital receipts while they can to manage this substantial transformational change.

“This has allowed them to avoid running down the reserves which helps them try and manage the growing financial risks to local services.

“This is not a sustainable, long-term way to support councils’ budgets.

“The spending review will be make or break for vital local services and, with councils in England facing an overall funding gap of £8 billion by 2025, securing the financial sustainability of councils and local services must be the top priority.”

Main photo credit: The Bristol Port Company

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