Company concerns “falling on deaf ears”
Sir, Your readers will have read (Herald, 11th March) of the criticisms of myself by the council’s portfolio holder for resources, the council’s money, over the council’s company, Heart of Cumbria Limited. I would like to lay out my concerns to the residents of Eden since they seem to have fallen on deaf ears within the ruling executive of the council.
When the executive brought to council in January this year a request for £1 million of taxpayer money to be made available to Heart of Cumbria Limited the report contained the business case provided by that company in support of its request. The first line of that business case read: “The company was established by Eden District Council to generate revenue to meet the perceived shortfall in funding from Government to it up to and beyond 2020.” (See the public documents on Eden Council’s website).
The second paragraph of that document read “Eden District Council as shareholder meeting as the company at its meeting on 10th November 2016, said it wished the board of directors to: Provide affordable housing; seek economic growth and higher paid jobs; and seek a three per cent. return on any council investment.”
All well and good, up to now. Any sensible reading of that would suggest that the £1m to be lent by Eden Council to the company would attract an interest rate of three per cent.
When I tried to get this recorded in the minutes it became translated by the time the minutes were set in stone to “That Eden District Council is willing to put forward the two tranches of money as loans on the condition that the money be used: a. To support the provision of affordable housing; b. To support the creation and generation of growth and higher paid jobs within the district; or c. The company provide a minimum of three per cent. return on any council investment.”
That paragraph was inserted by myself as an amendment, but without the word “or”. When I tried to get my original intention reinstated I lost the vote.
I have also tried, to no avail, to find out how much council officer time is being expended on work for the company, since that time is being paid for by taxpayers.
My problem is that £1m of taxpayer money will be given to Heart of Cumbria and, not only will the capital not be repaid, but interest also may not be paid since if condition a or b above is met then the three per cent. interest will not be forthcoming.
Since the reason for the company’s existence is to generate money to meet the shortfall in government funding then that is not a good start.
The company’s sole remit should be to generate extra money for the council, since that is the stated reason for its existence and the other aspirations have long since been functions of the council and are already enshrined in the council plan. There should also be full transparency over the company’s costs and a clear separation between those of the council and those of the company.
I may also take more notice of criticisms of my stance towards Heart of Cumbria Limited if they did not come from a director of that company. Yours etc,
(Lib Dem Eden councillor for Penrith East)