Cash-hit Yorkshire council seeks business world links

A CASH-starved Yorkshire council is looking to forge new deals with the business world to counter a £21m financial crisis caused by Government's cuts.

York Council is at the forefront of a drive by financially stricken local authorities to develop new partnerships with the private sector in the battle to try to balance budgets.

A series of hammer blows to York's economy during 2005 and 2006, when 1,500 jobs were lost, led to crisis talks between the city council and business leaders to prevent more redundancies.

The relationship between the public and private sectors has since flourished and is now seen as key to countering the dramatic reduction in funding from Westminster.

The council's chief executive, Kersten England, admitted the authority is facing unprecedented financial pressures to slash 21m from its current 117m net revenue budget in the next financial year.

"This will be the toughest budget that the council has ever set in its history," she added. "However, we have a fantastic asset base to develop with the skills of the workforce and the actual economy itself.

"We believe we can find a way through it (the cuts) with the relationship we already have with the private and voluntary sector."

The Government has already noted York Council's work with the business world, which won praise from Ministers last year. An innovative partnership developed by York Council's Libraries and Adult Learning teams and one of the city's biggest employers, Aviva, was highlighted by the Government as part of a national review.

The desire to work closely with the city's business leaders was borne out of the devastating number of redundancies, mainly in York's traditional manufacturing base. Terry's and British Sugar both closed their operations in the city, while Nestle shed 645 jobs in 2006. Aviva, then called Norwich Union, also announced 450 job losses that year.

A major independent review of the city's economy, called the Future York report, has been instrumental in developing a close working relationship between the council and major businesses.

Despite the economic gloom, the city is witnessing an unprecedented level of major development and last week was named as the second-fastest growing city in the UK behind Milton Keynes in a flagship economic study. The Cities Outlook 2011 study also noted York's economy was among the best placed in the country to deal with the recession.

But the report warned the city could lose up to 2,400 jobs across the public sector between now and 2014/15 due to the Government's spending cuts.

Eighty posts out of 222 full-time positions are expected to go as the council battles to cut 3m during the next four years from its annual 11m revenue budget.