The loan arranger

8 Apr

The minutes of the council meeting on 23 February include a section called Members Question Time. I don’t recall seeing this before, so perhaps it’s a recent innovation (or I haven’t been paying proper attention – which is entirely possible).

One particular bit caught my eye, which I’ll quote without further comment (though my emphasis added):

Councillor John Gray to Councillor Lester Hudson:

I note that in Agenda item 14 Annual Treasury Strategy Statement 3.2.2 on Borrowing Strategy (page 55) that the Council will not borrow more than it needs purely in order to profit from the investment of extra sums borrowed. However, is this in conflict with recent statements that in the future Newham will earn income from loans it makes and that this is the sort of commercial money making activity that the Council should engage in?

Answer:

Cllr Hudson advised that the Treasury statement was self explanatory and referred members to pages 151- 153 of the report which provides information on the Council’s borrowing and Capital Program. If the Council can borrow at a low rate and lend at commercial rates this adds value to the Council and enables us to extract income to cross subsidise where there are holes in the budget. 

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2 Responses to “The loan arranger”

  1. law27 April 8, 2015 at 18:24 #

    As far as I can remember, there has always been a members questions slot at the beginning of Council; whether or not any councillors have taken advantage of it is another matter.

  2. d April 8, 2015 at 21:20 #

    ‘and enables us to extract income to cross subsidise where there are holes in the budget’. l wonder what holes Hudson is talking about.

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