Homes scheme bill rises
ROSSENDALE’S council leader has hit back over fresh criticism of the lead Labour group’s handling of the Empty Homes Scheme debacle.
Chief executive Neil Shaw produced an update report for the council’s latest Audit and Accounts Committee meeting - stating that the scheme’s net cost to date is just under £6.1m.
Addressing the meeting’s findings, Conservative group leader Coun Peter Steen speculated that the cost to the Valley taxpayer could yet rise by up to £2m.
In his monthly Free Press column he added: “The senior Labour politicians are still there collecting their Special Responsibility Allowance each month, but refusing to accept any responsibility.”
However in response, Coun Barnes said the council’s in principle agreement to join the scheme took place under the last Conservative administration which they replaced in 2011.
She said: “The investigation into what happened stated unequivocally that councillors, on all sides, were not given information that should have been provided. Officers produced multiple reports, to multiple committees, which stated there were no risks with the scheme and that it was working well and better than expected. We were assured protections were in place; they obviously weren’t.”
AAAW Ltd, a company the council brought in to manage the refurbishment of hundreds of homes across East Lancashire, went into liquidation in 2015.
Later that year an audit report, carried out by Lancashire County Council, catalogued a series of errors that had dogged the scheme. Findings reached by the independent auditors included that the council’s constitution was effectively disregarded in regards to the lack of involvement of elected members.
Mr Shaw’s update report reveals that the council’s total scheme expenditure in 2019/20 was £723,000. A provision of £300,000 has also been made in the Medium Term Financial Strategy (MTFS) for 2020/21 for the scheme, with 112 properties still covered.
He adds that the council has experienced “considerable pressures” from a number of legal firms representing owners, including £150,000 of back rent paid this year to settle one of these claims.
The report states: “The council aims to minimise legal claims in relation to back rent, repairs etc but the conditions of the lease are extremely restrictive for the council.
“Claims are being actively managed and challenged, but these are likely to have an ongoing financial impact on the project and have been factored into the anticipated future cost projections.”
In August 2016, Calico were appointed as the managing agents for the majority of the properties.
The remainder are managed by a letting agent.
Mr Shaw adds that management of the scheme has proven “extremely challenging”, adding: “Officers have aimed to manage the project throughout to the best of their ability. There is a need for on-going tight control of the project. The internal management of the project has recently changed to actively contract manage Calico and the other letting agent, challenge contractors’ cost estimates, ensure works are completed to an appropriate standard and leases ended.”
The chief executive has been designated as the lead senior officer for the remainder of the project, which will report to the council’s Programme Board and provide regular updates for members.
Lancashire Police are still investigating the project.
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