Government dithering not helping councils

Eric Pickles has attacked the Government for dithering over guarantees for council deposits in Icelandic banks.

Many councils have money on deposit in Icelandic banks – and Eric, the Shadow Secretary of State for Communities and Local Government, warned:

"Councils have literally billions on deposit. If they now all panic, pull their money out in the safest option like Government bonds, there will be adverse consequences.”

He stressed that a lower rate of return from investments will increase pressure on council tax bills in April.

And he called on Alistair Darling to “provide reassurance" to the public that they won't see their council tax bills rise or local services cut as a result of this crisis.