The S151 Officer introduced the Council’s Financial Strategy report which has superseded the Investment Portfolio update report in the July agenda. The S151 Officer explained that the financial strategy is set out at paragraph 1.2. A paper will be brought through Overview and Scrutiny in February regarding the Capital programme and progress on obtaining circa 150 million pounds of capital receipts. The Divestments are covered in paragraph 4.4 of the report. The S151 Officer confirmed that the CCLA investment was a traditional Local Authority investment. 100 million pounds had been invested, reports are due in the second week of February, on the last check the investment was around 80 million, it will not be 100 million pounds but it will help pay down the Council’s debt.

The S151 Officer confirmed there will be a new set of auditors from 2023/24 as BDO cease to be effective once the accounts are completed for 2022/23.

The S151 Officer confirmed for the time being they are focussing on the larger investments over the smaller ones.

Councillor Massey queried if there was a link between JLG and PWE as they had a similar business model.

The S151 Officer responded that he was not aware but he could find out.

Councillor Massey queried how many investors there were in PWE apart from Thurrock.

The S151 Officer confirmed he did not have that information but could find out and report it back to Committee.

Councillor Massey queried Safe as Houses, the S151 Officer stated that this one had been parked slightly whilst they focussed on Toucan but he will obtain an update.

Councillor Watson noted that for CCLA there had been a loss of 6-7 million already, she queried if it is likely to devalue further.

The S151 Officer confirmed a decision is made at a point in time and you get the value at the time of disposal. The market fluctuates, if sold in the past it might have made a profit. If valued on 31 January, it will be received about a week after.

The Deputy Monitoring Officer confirmed that if there is a shortfall of recovery they are looking as to whether any individuals will be accountable. Five Letters before Action have been served. By the latter part of January, officers will be able to provide more information to Members on this. King’s Counsel will be instructed to advise and complete a cost / benefit analysis. The one certainty of litigation is the uncertainty. Mediation may be better as the money will be received quicker; litigation is not a quick solution. The pre-action work takes 6-9 months, then there will be court hearings and it will depend when there is sufficient court time. The Administrators have remedies too and a duty to investigate Director’s conduct. Administrators have a right to interview and to access documents.

Councillor Massey highlighted the importance of the accounts being completed.

The S151 Officer confirmed there is a push to get the accounts of Councils in financial difficulty completed first. It is a nationwide issue and only five Councils in the UK met their statutory deadline. The S151 officer confirmed the new auditors will be Ernst and Young.