Reform bankruptcy claim

A new Reform UK Derbyshire county councillor has claimed the authority is “six months from bankruptcy” and that the party has “inherited an empire of dirt”.

Cllr Dan Price, newly appointed Reform councillor for Ilkeston North on Derbyshire County Council, made the comments on Facebook on Friday, May 2nd, following the outcome of the election and his own successful appointment.

He said the council was a “business” which needed to be made “profitable”.

Councils are not businesses but they can own and operate arm’s length companies which primarily aim to cover their own costs. They can administer charges for services which are then reinvested to continue and/or improve services but this is not viewed as a “profit”.

Cllr Price won the Ilkeston North seat with 56 per cent of the vote, surpassing Labour in second and the Conservatives in third. He also won a by-election for the Cotmanhay ward of Erewash Borough Council, becoming its first Reform councillor.

He said in a video on his Facebook page that the county council was “haemorrhaging” money with it being “wasted on gimmicks and silly policies”.

Cllr Price, chairman of Erewash Reform, said: “The council is on the verge of bankruptcy and they reckon within six months Derbyshire County Council will be bankrupt.

“So it is egg on our face, we have inherited an empire of dirt. So, no matter what we do, most likely it will blow up in our face and we will be to blame, but I think not.

“We will try and save this sinking ship and then we shall start trying to make a profitable (sic) and start trying to provide good services.

“But we can’t promise anything, we can’t promise the world. What, you want us to get more in debt? That is not how things run.

“We have to stave off bankruptcy, get DCC back on track, earning money, being profitable, because technically it is a business, and then we can start offering good services.

“We have got a hell of a job, this is a massive undertaking. It is almost like the opposition has purposefully ran the ship aground. We won’t fail, we will get this rectified.

“People say what are your policies? Our policies are what the people want. People want the roads sorting, it’s done, it’s a given. They want SEND improved, done. They want safer streets, done, we’ll look into that. They want more doctors and medical staff, done. They want public services to be more reliable, done.

“The problem is there is no money. They have haemorrhaged money, they are on the verge of bankruptcy, £410 million in debt.”

Cllr Alex Dale, the new Conservative group leader and former cabinet member for children’s services under the previous Tory administration, said: “It should be no surprise to anyone, not least someone who stood in the recent elections to serve on the authority, that the County Council has been going through a very difficult period financially. We’ve always been totally open and honest about it.

“The challenges across social care in particular have been long running and unless Reform UK have spent the last five–ten years with their fingers in their ears, it’s hard to believe they weren’t aware of these sector-wide challenges.

“As a result of our management of the finances, the budget the new Reform administration is inheriting is in a much better place than it was just a couple of years ago and far better than many other authorities across the country. 

“Cllr Price’s video shows that Reform are only just waking up to the fact that running local authorities, especially one as large as ours and with massive statutory duties, is far from easy, despite what they tried to suggest during the election. 

“There will certainly be very difficult decisions to take in the months ahead, but I can reassure Cllr Price we will absolutely be holding them to account every step of the way on behalf of Derbyshire residents, as well as holding their feet to the fire for the promises they made.

“But frankly, if Reform UK no longer believe they are up to the task of serving the people of Derbyshire, they should do the decent thing: resign en masse and make way for those who will. One of their own colleagues in Newark has already done just that after less than a week in office.”

The county council was asked to confirm or deny whether the authority was currently set to go effectively “bankrupt” (councils cannot formally be declared bankrupt) in the next six months. Council officials can issue a Section 114 notice if they feel a balanced budget cannot be reached which leads to a formal freezing of new spending and can lead to direct Government intervention.

A county council spokesperson did not confirm or deny the “bankruptcy” allegations, saying: “The county council approved a balanced budget for 2025/26 at the February 2025 council meeting. 

“The budget report at this meeting set out a number of proposals to enable the Council to maintain its financial standing.  

“This will be through delivering these proposals and operating within its approved budget.

“Legislation sets out how councils should operate from a financial management perspective. These are detailed in various Local Government Acts and cover areas such as budgeting, financial reporting, and the management of financial resources. 

“The approved budget of the council enables the organisation to deliver services to the residents of Derbyshire within the parameters set out in government legislation.”

For the next financial year the council, under the previous Conservative leadership, planned £19 million in additional cuts up until March 2026 in order to meet a balanced budget.

Former Conservative leader Barry Lewis, who lost his seat in the election, had said: “The cupboards are quite bare.”

The council’s budget for the current year is £770 million and includes £19 million in cuts and a council tax rise of 4.99 per cent.

Reform UK has pledged to cut taxes in Derbyshire.

Earlier this year the council was facing a £28 million overspend due to social care pressures and had made cuts of £31 million over the past year.

Surging budget constraints, from children’s services and adult’s social care, add up to a £77 million “demand pressure” (£47 million from adult social care and £24 million from children’s services).

It was forced to use £49 million in reserves to meet a balanced budget in March, making it the third year in a row it used around £50 million from its emergency funds to meet a legal neutral position.

This left the council with £35 million in its general reserves, with the council told this cannot fall below £25 million.

The council is predicted to need to borrow £333 million over the next three years to cover its finances.

Mark Kenyon, the council’s finance chief, had said “this is something we cannot continue to do”, dubbing the “nearly £80 million” in social care pressures “eye-watering”.

He said this had left the council in a “difficult” position”, saying it was “critical” going forward to “work within the allocated budget”.