Folkestone & Hythe District Council Fails to Spend £11.88 Million on Promised Projects

Folkestone & Hythe District Council has left £11.88 million of budgeted capital spending unspent over the past two financial years. This money was earmarked for improving infrastructure and regenerating the district — but was never used. Official documents confirm that the funds were intended for projects like the seafront, environmental improvements, and economic development. However, due to delays in procurement, missed grant timelines, and internal planning problems, key initiatives have been repeatedly postponed.

What Is Capital Spending?

Local councils manage two main budgets:

• Revenue budget: Pays for day-to-day running costs like staff salaries, bin collections, and temporary contracts.
• Capital budget: Pays for long-term investment in public infrastructure — things like refurbishing toilets, installing street lights, building offices, or modernising IT systems. These are usually funded through a mix of government grants, borrowing, and selling council-owned land or buildings (called “capital receipts”).

The General Fund Capital Programme covers this second category: big-ticket, multi-year investments that aim to improve services, deliver regeneration, or build public infrastructure.

Actual Underspend: £11.88 Million in Two Years

A detailed look at the council’s records shows substantial underspending:

This means 29% of all capital funding approved by the council was not used for its intended purposes during the past two years.

Where Was the Money Supposed to Go?

The projects affected by the delays and deferrals include a wide variety of public services:

Seafront and Coastal Infrastructure

• Coast Drive Seafront Development: £760k slipped from 2023/24, and another £175k in 2024/25 delayed into the next year.
• East Cliff Landfill Protection: A major £1.2 million project to protect coastal land was cancelled outright in 2023/24.

Community Facilities and Public Toilets

• Toilet Refurbishment Programme: £113k was budgeted in 2023/24, but not used; only £15k was spent in 2024/25.

Lighting and Environmental Projects

• District Street Lights: £60k was carried forward in 2023/24, with another £45k deferred in 2024/25.

Major Regeneration (Levelling Up Funding)

• Folkestone – A Brighter Future: £263k unspent in 2023/24 and a further £2.58 million in 2024/25 due to delays in procurement and delivery.

Business and Economic Development

• UK Shared Prosperity Fund & Rural England Prosperity Fund: £687k combined underspend across both years.
• Green Business Grants: £180k not used in 2023/24; only £65k spent in 2024/25.

The council has been candid about the reasons for the delays:

• Contractor and procurement delays: Several projects faced difficulties tendering or finalising contracts.
• Planning and legal complications: Property acquisitions (like those for Otterpool Park) were slowed by price negotiations and conveyancing.
• Scheme slippage: Delays pushed timelines into the following financial year, causing a mismatch between budget approval and actual delivery.

These delays are a recurring issue. For example, in 2023/24, £1.78 million earmarked for Otterpool Park wasn’t spent. In 2024/25, a further £420k for the same development was again deferred.

Despite the underdelivery:

• The council borrowed £9.31 million in 2023/24 and £7.99 million in 2024/25 to fund its capital programme.
• However, much of that borrowed money wasn’t used, meaning the council may be paying interest on money it hasn’t yet spent.
• Additionally, capital receipts from land and asset sales — which are meant to help fund capital works — went unspent (£1.75 million in 2023/24) or fell short of expectations (£454k not realised in 2024/25).

This situation raises red flags: while no money is lost, the council is effectively carrying financial commitments for projects that haven’t happened.

Many of the schemes rely on time-limited government grants. If the funding is not spent within required timeframes, it may have to be returned to Whitehall. This risk applies particularly to Shared Prosperity Fund and Levelling Up Fund projects.

The council insists that no borrowing is committed unless there is a confirmed scheme. Yet over £8 million in 2023/24 and over £3 million in 2024/25 was carried forward into the next financial year.

The underspending may not look like a problem at first glance. After all, money hasn’t been wasted. But for residents, the consequences are real:

• Delayed refurbishments of public toilets, lighting, and seafronts.
• Deferred improvements to business grant availability and green infrastructure.
• Postponed regeneration, especially in town centres.

It also raises bigger concerns about the council’s internal capacity to plan and deliver large-scale projects on time.

Folkestone & Hythe District Council has ambitious capital plans — but ambition needs to be matched by delivery. The public expects that money approved for projects will result in actual improvements. The evidence from the last two years suggests a growing gap between intention and execution.

With over £11.88 million unspent, the priority for 2025/26 must be clear: turn budgets into bricks, and policy into progress.

We would be interested in hearing about your experiences of Fokestone & Hythe District Council. Email: TheShepwayVoxTeam@proton.me in confidence.

The Shepway Vox Team

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