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Council red-faced over homes 'grant' blunder
1:00pm Friday 4th July 2008
Comments (10)COUNCILLORS have been left red-faced after finding out a £143million grant they had earmarked to improve tenants' home is actually a loan.
Basildon Council's ruling Tories had planned to use the money to improve its 12,000 homes.
They even set up a company to handle the £143million windfall.
However, they have now found out that the money is not a grant and they would have to pay back every penny.
St Georges Community Housing Association, which cost more than £2million to set up and £350,000 a year to run, could now be disbanded, due to the blunder.
It looks after all of the district's council housing stock.
Labour group leader, Lynda Gordon, said: "It is a total fiasco. The Tories should have had this level of information from the start.
"We will be raising serious questions as to why this never came to light earlier."
The council already owes £170million on the homes - and if it continued with St Georges and went ahead with the loan, it would take borrowing up to £313million.
The Government encourages councils to set up arms-length management companies, such as St Georges, so they can apply for money otherwise not available to local authorities.
The Government, not the council, would pay interest on the loan.
Council leader Malcolm Buckley said: "As far as we were concerned, it was like regeneration money for the Five Links estate, where we bid to a grant-funded project."
He said a report was being prepared for the cabinet in September on how it had happened and what could be done - with one option to close St Georges.
He added the association could only be disbanded with the consent of tenants and the Secretary of State.
The revelation means tenants and opposition councillors were misled during consultations over setting up St Georges from 2005 and votes before it launched last April.
Other options were to give the homes to a housing association or for the council to keep full control.
Mrs Gordon said: "The tenants have voted with the wrong information and we will be asking if this nullifies the decision."
Tory councillor for Laindon Park, John Dornan, who sits on the St Georges board, said he was aware the money was a loan but said his questioning of the issue had been glossed over.
Mr Dornan, who was elected in 2006 after the association had been set up, said: "I made my own inquiries and it was clear it was a loan. But, whenever I raised it with colleagues or St Georges, it was not addressed.
"I just assumed everyone knew."
Your Say YourEcho
Mr. Not an Idiot, says...
2:59pm Fri 4 Jul 08
Steve, Leigh says...
3:14pm Fri 4 Jul 08
left wing looney, Basildon Central says...
6:28pm Fri 4 Jul 08
Post script. Council are now looking at many, many sites to sell off, including green belt land, which they will not publish for fear of public outrage!
Do you really want this mob running our council? Somebody think of something we can do!
Happy Chappy, Basil - on the - Don says...
6:30pm Fri 4 Jul 08
(see what I did there?)
I'm not laughing, MUCH! says...
6:34pm Fri 4 Jul 08
Tom, Basildon says...
6:43pm Fri 4 Jul 08
I'm not laughing wrote:No, but only take one pencil and keyring per family, and if the children do a picture, make them share!
Does this mean the Basildon Festival is cancelled tomorrow?
Voyager, Basildon says...
1:25pm Sat 5 Jul 08
neeelix, laindon says...
9:14am Mon 7 Jul 08
See ya wouldnt wanna be ya, Local says...
7:39pm Mon 14 Jul 08
neeelix wrote:Well said!! We all thought it was a bit odd the offices were so plush - funny how the contractors got that finished before they walked out on the job....
sgch are total waste of money, they have got their priorities all wrong! - notice how they can afford to move to plush new offices to the rear of the laindon communtiy centre - but they can't even complete minor housing repairs - i have an open case with them that has been running for three years! - close them down and sack the lot of 'em
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See ya wouldnt wanna be ya, Local says...
1:53pm Fri 4 Jul 08
Re the following copy of piece in the Echo on 14th August 2007, maybe Mr Dornan needs to follow up his promise....A BOARD member of the firm in charge of Basildon Council housing has threatened to quit if improvements are not made to its failing repairs service.
John Dornan, of St Georges Community Hou-sing Association, spoke out after the Echo exposed a catalogue of flaws with the company and its repairs service.
The association was set up by the council in April.
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Mr Dornan, who is also a Tory ward councillor for Laindon Park, said: "I recognise a host of concerns highlighted in the Echo regarding problems with housing repairs.
"I set myself a target when I joined the board - one year to make a difference.
"A second-rate service is not acceptable to me or the people of Basildon.
"The litmus test will be if I am still on the board when the year is up next April."
Last week, we revealed scores of tenants were living in sub-standard homes because of dwindling repair budgets, while the amount of cash needed to do them up had risen by millions.
However, Mr Dornan said he was confident improvements could be made.
He said: "Behind the scenes there has been a huge drive to improve services, and trust me, that drive continues.
"I am absolutely confident we will achieve results the people of Basildon demand and deserve.
"This administration, together with all its contractors, are committed to providing the best possible service, at a time when the Government is making us jump through hoops to obtain the money we need to bring houses up to scratch."
Tony Ball, deputy council leader, who oversaw the creation of St Georges, said: "We recognise the problems we face, but are in a Catch-22 situation.
"The council isn't eligible for the funding and St Georges has to operate without the £143million (Government funding for repairs) until it reaches a two-star status. It was not feasible to transfer our stock to a private firm.
"At the same time, the Government is taking funding from our housing budget, therefore the tenants of Basildon, and giving it to councils in the north.
"Over the next three years the Government has demanded we hand over nearly £7million which will go up north, while we struggle to improve our 12,000 houses."
3:15pm Tuesday 14th August 2007
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