Government stop lending to councils for property speculation

25 November 2020

Councils’ speculative investment will be ended

Green and Liberal Democrat councillors at Mid Suffolk have welcomed the Government announcement that the Public Works Loan Board (PWLB) will no longer lend to councils buying investment properties.

Councillor John Matthissen said :

“The Government made clear its intentions over two years ago, (Feb 2018 see below) and again in launching a consultation on PWLB in May this year,( see below) and we particularly regret the very recent purchases by CIFCO despite these warnings and public opinion, putting a further £13million of council taxpayers’ money at risk. Green and Liberal Democrat councillors having opposed this venture from the outset and also pointed out Government intentions as they were made clear, it is disappointing that the two councils have pressed ahead with the second £50million loan, buying more than £20million of remote commercial buildings. As properties have declined in value CIFCO’s mounting losses are undermining the capital base of both district councils.”

Liberal Democrat councillor John Field added

The CIFCO directors have talked about continuing their investment programme by seeking money from other lenders. They should note carefully the Government reasoning for stopping PWLB loans, clearly stated as the risk to local taxpayers.”

Both parties have urged that Cifco should be borrowing to build houses, especially for social rent, the most pressing need in the District.

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    Next meeting Thursday 27th May AGM 7.15  for 7.30pm on Zoom virtual meeting. 

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