MY letter (July 23) regarding the council accounts did not accuse anyone of hiding the facts. I was only expressing my concern regarding items published in the audited accounts, the foreword to which was written by Councillor J. Byrne in his capacity as chairman of the resources committee.

I took great care to make it clear that the items referred to were in the accounts for the financial year ending March 31, 1998, and at that time the education committee had responsibility for financing the schools. It is only this financial year (1999-2000) that governors have been given extra responsibilities, one of which is managing their school's finances.

Councillor Byrne says that the £1,595,000 underspend was passed back to the schools but I would refer him to page 48 of the statement of accounts 1997-1998 which states: "The authority operates a scheme of local management in schools that has been approved by the Secretary of State for Education. This allows schools in Bury to carry forward any over or underspend to the next financial year. In 1997-1998 an underspend of £1.565 million was contributed to the general fund by schools and is carried forward to 1998-99".

In other words, the money did not go back to individual schools but into the general fund, which for the financial year 1998-99 was controlled by the council.

With regard to the preparation of budgets it is possible to overbudget in some areas to justify increases in revenue and have a surplus at the end of the financial year. I do not say that this is the case here but I do note that departments are only allowed to keep part of any underspend.

In my opinion it was due only to poor financial management that we became involved in the BCCI debacle and, though some of the losses have been recouped, the loss of interest and legal costs involved in the recovery of the investment still leaves the finances well down.

As for the £3,172,000 outstanding for car loans to employees I am sure that the money - which Coun Byrne says could not otherwise be spent on services - would be better invested at a higher rate of interest instead of being used for subsidised loans to employees. They pay about three per cent interest which must barely cover administration costs, never mind produce a small profit.

Finally, Coun Byrne tells us that the council will again be having a series of budget consultation exercises. I hope that residents will be given more notice this time as the one held covering the Redvales district last year was announced in the Bury Times on the Friday for a meeting being held three days later.

A. WITHINGTON,

Wellington Road, Bury.

Converted for the new archive on 14 July 2000. Some images and formatting may have been lost in the conversion.