COPELAND Council came within “24 hours from bankruptcy” when the elected mayor discovered a £13 million black hole in the finances, it has emerged.

The borough’s first elected mayor, Mike Starkie, discovered the depth of the crisis in June 2016 following a root-and-branch review launched as part of his election manifesto pledge.

The damning audit revealed a catalogue of blunders including basic errors in accounting that led Copeland Council to the brink of ruin.

And if the Government had not agreed to write off a £2.9million overspend, the council would have been forced to issue a so-called “Section 114 order” imposing emergency spending controls.

Mr Starkie, who claims to have turned the council’s fortunes around at the 11th hour, has chosen to speak out about the crisis he inherited ahead of May’s election.

He said: “Twenty-five years of Labour mismanagement had the council accounts in complete disarray. It took us within 24 hours of bankruptcy.

“There has been a huge recovery but also a huge knock-on effect in cleaning up Labour’s mess.

“If this issue hadn’t been addressed when it was, there would have been no election to fight this year because the council was careering off the edge of a cliff. I am still playing catch-up.

“We had to find £13 million to balance the previous accounts which were due to be closed the month after I was elected. An £800,000 underspend quickly turned into a £1 million to £2 million overspend. It was almost two years before we could close it – and by that time the gap had grown to £13 million.”

The catalogue of financial failure goes back at least to 1990 but Mr Starkie claims that lessons had not been learned from the mistakes of the past. But since the discovery, he has led on overhaul of the authority’s approach to its finances, with full-time employees in place of consultants.

The turnaround also comes after the council was hit by a devastating cyber ransom attack over the August bank holiday weekend from which it is still recovering.

Mr Starkie added: “We have restructured the whole organisation. Under the management plan we have now raised millions of pounds so I am sitting on a war chest that will be used to fund a commercial agenda when I can identify appropriate schemes that can generate revenue going forward. The council is now being run like a business.

“Despite the financial problems that we have inherited and the budget reducing from £10.5 million in 2015 to £8.98 million in 2019, we have not made a single cut in any of the services we provide in the last three years – and we have actually reversed some of the previous cuts.

“It has taken the full first term to sort this mess out. The council is night and day from what it was in 2015.”

The steps taken since the problem was discovered have allowed the council to invest in recycling, bereavement services and Copeland’s Pride of Place regeneration scheme. The authority has also reversed cuts to street-cleaning and tourism and completed a pay and grading review to bring salaries in line with other councils, allowing them to take on more full-time staff and up to six apprentices a year.

Mr Starkie thanked the then chief financial officer Fiona Rooney who carried out the audit for her hard work as the crisis unfolded.

“She did a fabulous job in identifying all these issues despite intolerable pressure and personal attacks from a small minority of councillors,” he said.

Mr Starkie stressed that it was the pre-coalition Labour leadership who were the “authors of our financial misfortune” rather than Labour councillors, the Labour Party as whole or officers.