27 November 2016
The plan to try and fund local council services with profits from buying commercial property has moved a step closer, but an opposition Green Party proposal that at least half the investment should be within the locality of Mid Suffolk was rejected by the ruling administration, being deemed “too risky.”
Councillor Andrew Stringer explained:
“We are opposed to the principle of trying to fund council services by leveraged investment in commercial property, but if the administration is determined to pursue that path, they should at least invest locally to advance our strategic objectives, such as to ‘Lead and shape the local economy by promoting and helping to deliver sustainable economic growth ..’ “
Despite opposition concerns and local disquiet, Mid Suffolk conservatives last year approved powers to borrow up to £25 million, suggesting this might be invested in local homes for private rental. Now the proposal is to invest in commercial property such as shops and offices anywhere in the Eastern counties.
Additional disapproval emerged immediately after the meeting, with Public Accounts Committee of MPs reporting that Government was lacking understanding of significant financial risks for councils, such as commercial property investments. They went on to say: “Our committee has previously highlighted gaps in the commercial skill of the Civil Service as a factor in the failure of some projects and we have similar concerns about local government. Poor investment decisions cost money—money that might otherwise be spent on public services.”
Councillor Rachel Eburne commented:
“This is like the head of the NHS proposing to set up a division to build and manage leisure resorts to help solve its own funding gap. It is essentially a speculative commercial venture. Profits are not guaranteed and there is a risk involved that public money is being asked to underwrite. This is not the way that money borrowed by a local authority should be used – especially when it is not even being used in the council’s own area.”
Dates of next meeting(s)
Wednesday 31st May at Cafe 52
- Mid Suffolk meetings generally held at Cafe 52, Crowe Street, Stowmarket, Suffolk, IP14 1DL
- Meetings occasionally held in Woolpit, Eye, Stowupland and Needham Market.
All Members and well-wishers welcome.
- June 8th Election Day - Don't forget to vote Green