Agenda item

The Chairman advised the meeting that one question pursuant to Council Procedure Rule No.9 had been submitted to the meeting.  This had been circulated separately to the agenda.

The Chairman invited Councillor Mick Devine, Gainsborough Independent and Ward Member for Gainsborough East to put his question to the meeting, as follows: -

“Leader

In recent years WLDC has had it’s Regional Support Grant reduced by Central Government, this resulted in a debate on how best to proceed to support services., It was agreed by Members to build an investment portfolio with strict criteria with the aim of providing an income to support services to our Communities.

In recent weeks and months there have been a number of Social Media posts regarding the property investments made by WLDC, the comments made are I believe misleading the residents of West Lindsey and Gainsborough in particular and I quote

“Current WLDC Tory Controlled Council recently spent over 20 million pounds of council tax payers money on projects outside the district”.

This I believe to be misleading the people of Gainsborough and they deserve to know the true facts.

Can you please put on Public Record the facts as they are

1 Where the investments have been made

2 The year when the investment was made

3 The total value of new investments by year

4 The total net income by year of the investments to support Services

Many thanks”

The Leader of the Council, Councillor Owen Bierley, responded as follows: -

“Thank you for your question Councillor Devine.

As part of the Commercial Strategy, agreed in 2015, Council approved the development of an investment portfolio, with strict criteria, that would deliver a minimum of 6% gross return (3% net) with a maximum expenditure of £20m.  This amount was subsequently increased to £30m.

In accordance with the approved Commercial Property Investment Strategy the Council has now purchased six properties for £20.455m.  (When including stamp duty, legal and professional fees the total costs have been £21.666m)

In terms of location, our strategy identified that if all of the properties were located in West Lindsey this would bring risks associated with investment in a single economic area.  Similarly the strategy recognised that by investing in a variety of sectors we would avoid any single sector risk.

35% of the investment has been in West Lindsey.

The first purchase was made in 2017/18 at a total cost of £2.490m with the property located in Keighley.

Four properties were purchased in 2018/19 at a total cost £13.494m of which one is in West Lindsey whilst two are in Sheffield.

A further property was purchased in Doncaster in 2019/20 at a total cost of £5.682m.

The portfolio has achieved gross and net income in excess of the strategy targets, with net income contributing to and supporting the provision of our valued services being;

The Council has been completely transparent in reporting these transactions through the Corporate Policy and Resources Committee.

Even through this difficult year for businesses the portfolio will achieve the returns expected and other than one tenant, the Travelodge (which is subject of a Company Voluntary Arrangement) all full year rentals have been met. 

In addition the current valuation of the portfolio has increased to £20,727,200.  This compares to the purchase price of £20,455,000.

Thank you again for your question.”

With the discretion of the Chairman, the Leader of the Opposition responded and questioned the motives of the question and called into question Councillor Devine’s current political affiliation and membership within the Administration. Investments had been outside of the District to the benefit of residents outside of the District.  He considered rentals had only been maintained due to Government furlough schemes and other benefits and time would tell, quoting loss made in a number of sectors.  The continuing asset value was questioned, as was the saleability of the investments.

Councillor Brockway by way of point of information, sought to remind the Chamber a short question had been permitted, and considered the comments being made were misleading.

Another Member suggested that without the money generated though these investments the Council’s financial position would be very different.

By way of point of information, Councillor J McNeill outlined to the Chamber Which Committee scrutinised such investments and of planned reports to do just such.

Councillor Devine by way of right of reply strongly refuted the question was political motivated nor was his political persuasion relevant.  Rather more, he had considered it appropriate and necessary to put on formal record the status of these investments, as in his view, social media posts had been misleading the people of Gainsborough regarding the true facts.