ESSEX Fire Service is being forced to use all of its £15million savings to pay off a debt it did not know it owed.
An investigation has been launched after the service discovered it had to pay the huge bill to the Governement for firefighters’ injury pension payments -wiping out its entire savings.
It should have been paying the Government an extra £1.8million every year since 2006 but an accounting “oversight” meant it had instead been paying just £120,000.
Last week, the Department for Communities Local Government flagged up the huge debt to Essex County Fire and Rescue Service (ECFRS) and some other fire authoritities.
It means Essex’s fire authority will have to find a further £1.8million per year on top of its £5.9million cuts over the next few years.
It has already covered this year’s £1.8million as it had underspent.
Acting chief fire officer Adam Eckley said: “At this stage we don’t believe it will impact on the delivery of front line services, we believe that the entire liability can be covered by the authorities existing level of reserves.
“Those reserves were held for the authority to manage any in-year shocks, financial shocks that were presented and that is exactly how they will be used on this occassion.
“The Fire Authority’s accounts have been audited annually by independent auditors appointed by the Audit Commission but until now, the discrepancy was missed.
“Even the Department for Communities and Local Government, who receive an annual return from all UK fire and rescue services failed to pick up on the liability.
“Because of our prudent financial management over the last few years we have built up significant reserves and we are in a healthy financial position and able to wipe out this debt immediately.
“This is a significant burden but unlike other fire and rescue services that will likely face a similar financial challenge, the Fire Authority has the cash to pay while remaining financially sound.”
No one has resigned or been sacked over the mistake but Kent Fire Service will conduct and independent investigation.
Mr Eckley added: “While the Treasurer and Finance Director is clearly accountable, we are not looking for any scapegoats.
“This was a genuine oversight by a number of parties and was brought to the Fire Authority’s attention as soon as it was discovered.”
Riccardo La Torre, Essex Chairman of the Fire Brigade Union, said they had been kept in the dark about the debt until it was announced yesterday and was waiting for more details.
He said: “It is just quite concering for a number of reasons, number one that the mistake happened in the first place and more importantly what it is now going to mean for our members.
“With the cuts they were already looking at losing 170 firefighters jobs when it was £5.9million so now that its £7.7million I am sure they will revisit that strategy.”
He also claimed the FBU had been reassured the reserves were to safeguard against redundancies.
Video: Essex Fire Authority to pay £15million to Government after accounting "oversight"
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