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Search forHopes for deal to free Iceland council cash
Wednesday, December 03, 2008, 15:00
East Staffordshire Borough Council was one of the British authorities hit by the financial crisis on the island, and has been unable to reach funds it had invested.
John Healey, minister for local government, told MPs this week financial experts drafted in to guide the affected councils found East Staffs had 'no short-term cashflow problems which would affect the delivery of key services, the payment of staff or the authority's ability to meet its contractual obligations'.
But it may need to consider the medium-term impact on its next round of budgeting.
Meanwhile Mr Healey said the Treasury was pursuing high level discussions with the Icelandic Government, to ensure that a mechanism is agreed for Iceland to honour its obligations to UK depositors and ensure the fair treatment of UK creditors. The International Monetary Fund has already approved a $2.1 billion loan to Iceland.
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