Chris Franks AM was in the local paper last week alleging that the Vale of Glamorgan Council has £70m in reserves- not Icelandic ones either! Obviously alot of this money has to be kept aside, especially as the economic downturn will get worse before it gets better.
So, let's say they decided to withdraw 20% of that fund. £14m would leave the vast bulk of the money intact and ready for future emergencies. If I was the council leader, I would take £7m and put it towards running costs and existing staffing costs so that local jobs don't have to be cut at such a difficult time. £7m would surely be a good 'insurance' payment towards keeping the existing workforce (note- there are no reports of the Vale threatening to cut staff at the moment that i'm aware of, I am just procrastinating). That would leave me with £7m which I would immediately use as a Keynesian-style (proper Keynesianism, not the Gordon Brown version of nationalising the debt and privatising the profit) injection into the local economy.
I would use the £7m to create 134 jobs, each of which paid £26,000 a year (a decent wage for parts of the Vale). £7m is enough to sustain these for 2 years, at which point a review would take place, and if necessary more of the reserves could be deployed to keep them going. These people would be employed in running a community cinema (Barry doesn't have one), growing food and running a local produce market (to promote land use, exercise and healthy eating), benefit take-up teams (many people do not claim the full benefit they are entitled to and money goes back unspent to the Treasury- i'd rather they spent it in local shops) and insulators to make houses energy efficient. The Council could also employ maybe a dozen people in some kind of low-price but healthy goods store similar to the system they have in Venezuela.
Just an example of what our Council could do with just a fraction of its reserves.