On 12 May the Conservative Group formally called in the decision made by Medway Labour to acquire currently occupied properties costing a staggering £46 million pounds of taxpayer money, citing serious concerns over financial assumptions, due diligence, and governance surrounding the investment.
Speaking on the matter, Cllr Andrew Lawrence emphasised the need for greater scrutiny:
“A £46 million investment of taxpayers’ money requires more than a leap of faith; it demands rigorous and transparent interrogation.”
The Group had previously proposed an amendment at Full Council to pause the decision, allowing councillors to fully review the financial and operational implications before committing significant funds to the capital programme. This request was rejected by Medway Labour under an ambiguous assurance that the job is being done.
The Administration continues to chip away at Medway’s financial stability, spending large amounts of taxpayer money while hiking up council tax and once again borrowing millions from the Government.
The Group argued that the decision was approved without sufficient examination nor with respect to proper democratic processes and warned that there is a risk of undermining the long-term stability of the Housing Revenue Account (HRA).
The following principal areas of concern were raised:
Financial Realism: The business case relies on interest rate assumptions that the Group believes do not reflect current Public Works Loan Board (PWLB) market conditions.
Due Diligence Standards: Questions remain over the lack of comprehensive, unit-by-unit inspections of the housing stock. Simply relying on representative samples could expose the council to significant unforeseen maintenance liabilities.
Inflationary Pressures: With the cost of capital works rising, the call in highlights the absence of a sufficiently robust inflationary buffer. This could impact service levels for existing tenants if costs escalate.
One of the most pressing areas of concern was the blatant lack of scrutiny displayed by the decision. Medway Labour failed to provide evidence of any scrutiny towards the decision at Full council. All aspects of large spends such as this must be thoroughly examined before any final commitments are made. Furthermore, the delegation of authority to proceed with the acquisition to just three individuals is neither sound nor adequately democratic for a project of this scale.
The call-in was used to press for the scrutiny Medway Labour failed to provide at Full council and to ensure that the decision is grounded in robust financial and operational evidence.
The Medway conservatives, in opposition, are committed to doing our jobs right and ensuring scrutiny is high quality and consistent; ensuring that decisions are grounded in robust financial and operational evidence.
