Boston Borough Council announces £20m loan potential

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Boston Borough Council’s finance chief is ‘confident’ targets will be met and has highlighted the potential of a joint £20 million loan after the authority’s previous investment returned an 11% return.

Councillor Aaron Spencer has been buoyed by the success of a £1 million property fund investment made three years ago, which on March 31 had returned £1.111 million – giving the council an additional £111,000 capital.

It comes as the authority and East Lindsey District Council look at how to spend a further £20 million loan.

After revealing the news to cabinet leaders on Wednesday, councillor Spencer said: “When you consider we put in to our capital budget £100,000 every year in order to make capital available to replace our refuse fleet or whatever we need, another £111,000 from an investment, from £1 million, you can scale that up to the £20 million over five years.”

He added: “This £20 million loan is a 5-year-project,  so it’s worth bearing in mind any minor changes to the property market might not affect the overall position and it gives us the ability to be dynamic and flexible.”

According to Councillor Spencer, the latest loan will be split between several different property funds in order to provide added security.

He said the authority had already gone out to tender for different management companies to come forward and make proposals.

It comes as the council looks to deal with government cuts which will see grant-funding removed by 2020.

A Transformation Programme has been rolling forward since 2011 to try to avoid the council hitting a predicted £1 million black hole by that point – with the latest version approved in 2016.

“We’ve been able to improve our overall budget position since I’ve been doing the job,” said Councillor Spencer.

Asked if he thought the council could meet its targets, he said: “We have plans in place that we can meet that within the year and the programme is constantly evolving.

“When we first set this target we didn’t have the money from the Controlling Migration Fund, now we’re taking another look at it to see how we can do it differently because we have more money to invest in the place, so maybe we can do it and meet those targets in a different way and potentially out-do them.”

He said that, although bigger projects take longer and there had been some ‘slippage’ in capital expenditure, the council did have other plans in place.

“If that’s not the right thing at the time, we can bring other projects forward and move it around to meet that target but no I’m quite confident that we’ll be ok.”

“Your bins will still get collected, don’t worry,” he added.

Daniel Jaines , Local Democracy Reporting Service