Struggling Northamptonshire County Council bans spending

A cash-strapped local authority has imposed emergency spending controls as it faces "severe financial challenges".

The section 114 notice bans all new expenditure at Northamptonshire County Council, with the exception of statutory services for protecting vulnerable people.

Last month the government said an inspector would look into allegations of financial failings at the authority.

It is believed to be the first such notice issued in more than 20 years.

The implications are due to be discussed at the full council meeting on 22 February.

A spokeswoman said: "The notice has been served in light of the severe financial challenge facing the authority and the significant risk that it will not be in a position to deliver a balanced budget by the end of the year."

The authority said staff pay would not be affected.

Bob Scott, leader of the Labour Group on the council, said: "I'm not surprised. I've been saying for the past five years there are problems there, and two years ago I said I expected a section 114 order to be issued.

"My only surprise is that it's been issued just after an inspector has been appointed and started his work."

The Conservative-led council announced in December that it was looking to increase council tax by almost 5% as it sought to make savings of £34.3m.

At the time, council leaders claimed they were facing huge demand for services, as well as cuts in government grants.

It was revealed in January the authority was considering selling its new £53m headquarters, which officially opened in October.

One Angel Square was designed to save money by closing 12 offices and making best use of a new office block.

Rob Whiteman, Chief Executive of Chartered Institute of Public Finance and Accountancy, called the move "highly unusual" and said it was the first section 114 notice for more than 20 years.

"Whilst Northamptonshire has had a difficult context within which to balance its budget in relation to government cuts, other councils in a similar situation have successfully managed their budgets," he said.

Secretary of State for Local Government, Sajid Javid, announced last month that a government inspector would be assessing the council's financial state.

Council leader Heather Smith said the authority had always been "open and transparent".