The council's deputy leader Terry Yates and director of resources Neil Taylor have issued a joint statement claiming that most of the £8 million will be recovered.

And residents have been re-assured that the council is being proactive in trying to get the council tax payers' money back and added that no-one at the council will be held to account for the loss.

The statement will be placed on the council's website in the hope that it will alleviate residents' fears that the money will be lost forever.

Here is the un-edited statement in full:

"All the 123 councils (almost a third of all authorities in England) affected by the Icelandic bank situation have not lost the money, it is at risk.

Ernst and Young administrators for two of the English subsidiaries Kaupthing, Singer and Friedlander and Heritable, have said that in broad terms, they considered that, the book value of the assets of each of these banks appeared to be of the same order of size as the liabilities.

So once the assets are sold, it is expected that the investments will be repaid. If Ernst and Young had given a different message Bassetlaw would have reacted differently.

Bassetlaw has £3 million invested with the Landesbanki and £2m with the Glitner bank. These are mainland Icelandic banks and this matter is being dealt with by national Government ministers and the treasury.

The Government's first priority has been to do everything it can to help local authorities, along with other creditors, get their money back. The Chancellor of the Exchequer acted quickly to freeze the UK assets of Landsbanki and, on 17th October, the Bank of England provided a short term secured loan of up to £100 million to the London branch of Landsbanki, which will help to ensure an orderly wind down for Landsbanki and maximise returns to UK creditors.

Talks are progressing between the UK and Icelandic Governments, and the Government has resisted making any guarantees to councils. This is why Bassetlaw has not sought any meetings to see ministers.
However, Bassetlaw has spoken to the Local Government Association's

Improvement and Development Agency and their team visited us on the 4th November. The council expects to be able to provide an update next week on the findings, which are expected to be positive.

Bassetlaw has £1 million invested with Kaupthing, Singer and Friedlander and £2 million with Heritable. The council has already submitted its formal claims to Ernst and Young, to recover its investments plus the interest.

In addition Bassetlaw will be represented directly on the Board of Creditors by our Director of Resources Neil Taylor (one of only six authorities nationally to do so) and there is also a meeting planned for all authorities affected by the situation in London which Bassetlaw will attend. So the council is being proactive, in working to get the investments repaid.

Over the past four years the council has strengthened its financial position and its financial standing is sound. Reserves at the end of 31st March, 2008 were £4 million. Reserves are there to deal with unforeseen incidents, ensuring that services to residents are not affected. These reserves equal about 50 per cent of the money at risk and the council is well prepared for the future.

Bassetlaw is confident that most, if not all the money will be repaid and therefore is not invoking any short term measures like freezing recruitment or asking the Government for additional borrowing as other councils are doing. It's business as usual in Bassetlaw.

There may be some short-term losses in cash-flow but these will be dealt with via the reserves, and the aim is that services will not be adversely affected.

Over the past few years the council has embarked on a continuous drive to improve efficiency to support better services and keep local taxes from the taxpayer to no more than inflation. Any savings generated strengthen the council's budgetary position, which again means that Bassetlaw has got more financial flexibility. This coming budget round will be no different.

The district auditor, who is independent of the council, has been updated regularly and will be involved in the overall plans for the 2009/10 budget before it starts. Again, Bassetlaw is being proactive.
The money, either all of it, or part of it will be repaid, the administrators have said so, and the Government's tactic of freezing Icelandic assets in the UK is a major bargaining chip.

Therefore the question is when and at what level? Should this be detrimental to Bassetlaw's operations, other options will be examined, but currently the council is dealing with things in a calm, assured and professional way. But this should not be confused with complacency.

The Government and the Local Government Association agreed that there is no evidence of any recklessness by local authorities. They also agreed the financial framework for local authorities, which requires them to strike an appropriate balance between security of investments and returns, appears to have been adhered to.

Bassetlaw's investments were made in January 2008 and July 2008 and are satisfied that the policies for such investments were adhered to correctly. (The Government's Audit Commission itself made a £5 million investment in July with the same bank as Bassetlaw). Therefore there will be no blame game at Bassetlaw.

Comparisons with other Notts authorities show that Bassetlaw's investment standards are high. But these standards were tightened at cabinet on the 4th November, to ensure no investment is now taken out for more than six months for the time being.
The council has been transparent about what it is doing, with regular information to the press and information on Bassetlaw's website. When there is more news the council will continue to keep the community informed."