When is a deficit not a deficit? (7 Jan)

... when it is a "balanced budget".

When is a £765,000 error a "minor discrepancy"?

Rugby Borough Council's draft income and expenditure budget for 2015-16 was approved by the conservatives on Monday 5 January 2015 (see http://rugby.lib.dm/a3RH3 ).

The budget allows for "expenditure" items totalling £14,909,790 and income items totalling £14,748,390. Therefore there is a gap between expenditure and income in the draft budget of £161,400.

In fact the position is worse than the draft budget shows. As previously reported on the Rugby Liberal Democrats website the draft budget did not allow for all the money the conservatives are planning on spending on the 2015 World Cup (See http://rugby.lib.dm/a6RH1 and http://rugby.lib.dm/a1RH3 ). Next year the conservatives are planning a spend of £765,000 on the World Cup celebrations as part of a £1 million overall package spread over two years. At the cabinet meeting on Monday Cllr Helen Walton (Con, Coton & Boughton) described the fact that the draft budget did not allow for this £765,000 as a "minor discrepancy".

When the £765,000 of Rugby World Cup expenditure is added to the £161,400 gap in the budget proposal we have a total deficit of £926,4000. Balancing the United Kingdom government's budget involves billions and not millions but proportionately the gap between income and expenditure is greater in Rugby Borough Council's draft income and expenditure budget for 2015-16 than the UK government's budget.

So why did Cllr Derek Poole (Con, Wolston & The Lawfords) refer to the budget as "balanced" at the Cabinet meeting?