Rates cut hits councils

PUBLISHED: 19:08 11 March 2009 | UPDATED: 14:56 04 May 2010

THE Bank of England s decision to slash interest rates to their lowest level in the bank s history has caused more than a ripple of concern at two councils in Crow country. This week a Herts County Council spokesman said the new rate would mean the budg

THE Bank of England's decision to slash interest rates to their lowest level in the bank's history has caused more than a ripple of concern at two councils in Crow country.

This week a Herts County Council spokesman said the new rate would mean "the budget for interest received has been reduced by £4.4m."

Councillors at North Herts District Council (NHDC), who had warned only a month ago that jobs might be at risk if interest rates fell further, now says it is looking at the budget for 2010/11 and ways of making efficiencies.

Councillor Terry Hone, NHDC's deputy leader and portfolio holder for finance, said: "We have budgeted prudently and had already anticipated this rate reduction when setting our budget for next year.

"However, we have concerns over how long interest rates will remain at the current low level, and we are already looking at the following year's budget to identify efficiencies.

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