Yes, a lot of councils have had money invested quite sensibly in Icelandic banks and appear to have been caught out. No one can particularly blame them for that. However, I was astonished to see that Breckland Council, a small Norfolk District Council whose total expenditure is £19 million (according to their own figures), has had £12 million invested (and possibly lost) in Icelandic banks.
My initial thoughts were that there are other councils who have lost more, but as a percentage of their total spend, is there another council who has lost more than 60% of their annual expenditure ?
The other question is why have Breckland got so much of their money in one bank ? Are they not supposed to spread the money around in order to spread the risk ? I note that the EDP states that Breckland has total cash reserves of £40 million pounds, so £12m represents more than 25% of total reserves.