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Thurrock council has borrowed hundreds of millions of pounds from around 150 different local authorities in the UK to invest in solar farms. With local authorities facing significant cuts in their central government funding, deviations from the conventional funding routes are somewhat inevitable (please click here for our webpost on councils issuing bonds through the UK Municipal Bonds Agency (MBA)). However with £1bn owed to other councils, debt-ridden Thurrock council has come under scrutiny for its rather bold investment decisions.
The Bureau of Investigative Journalism conducted an investigation into the borrowings and investments of Thurrock Council since April 2016. Thurrock refused to provide details of its borrowings such as the local authorities which lent to them. However through analysing over 125,000 payments made by the council, The Bureau compiled a list of over 150 local authorities that lent to Thurrock since April 2016.
The Finance Director of Thurrock Council, Sean Clark had not consulted with any treasury advisors about the loans or investments. The Bureau spoke with Abhishek Sachdev, CEO of Vedanta Hedging, as part of their investigation:
Abhishek Sachdev, an experienced treasury manager with Vedanta Hedging and a Conservative councillor in Hertfordshire, said he believed the company should have been consulted because assessing and challenging council borrowing “is arguably what they are paid to do”.
For the full story from The Bureau of Investigative Journalism, please click here.
Vedanta Hedging provides debt advisory services to Councils and Corporates. We have worked with several local authorities and Public Sector / Charitable institutions, most recently Newham Council. Please click here to see how we assisted with the termination of Newham Council’s LOBO loan.
