City Council leader David Mellen says the sale of millions of pounds worth of assets in an effort to cover debt is being done in an orderly fashion. Cllr Mellen, the leader of the Labour run Nottingham City Council, was speaking after it emerged government commissioners could be brought in to help run the authority.
In an effort to boost the council budget and reduce its debt levels, the authority has brought in over £30m of income from selling land and property it owns over the last two years – with over £90m more in the pipeline over the next few years. This year, the council is focused on a small number of high value asset sales, including The Guildhall, the former Central Library on Angel Row and property at Clifton West
Cllr said: “Selling property and land that we own and no longer require is one of the ways we can bring money into the council at a time when our Government grant is drastically reduced.
“We are not selling things in an unplanned way – it is properly assessed and we seek to sell it for as much as possible, unless they are community assets where there is some social value to be gained. Most of the properties that bring in larger amounts are commercial properties rather than community assets.”
This comes after millions of pounds of taxpayers' money was 'misspent' or pumped into the doomed Robin Hood Energy company. Council housing tenants’ rent – which should have been pumped into council housing and repairs – was put into general council services. The Penn Report, commissioned by the council, says the money was misspent, and in some cases was used to prop up other council services and to avoid job losses.
The council owns over 3,600 property assets with a combined asset value of over £1bn and is undertaking a rationalisation programme to identify whether it remains appropriate to continue to hold particular assets or to sell them. Commercial properties may no longer be providing sufficient return or be in need of expensive repairs, while the potential social value of community assets will be taken into account when considering possible sales.
Over that time, more than £30m of income to the council has been achieved through sales – beyond estimated targets. This year, the council is focused on a small number of high value asset sales, including The Guildhall, the former Central Library on Angel Row and property at Clifton West, to boost funds further – with an expectation that over £90m could be brought in over the next three to four years.
The council’s asset rationalisation programme is to be discussed by its Audit Committee on Friday 24 June.
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