I only ask because we (or rather, councillors acting on our behalf) are about to agree to taking out a major loan to come to the financial rescue of the stalled, village-style development at Kirkstall Forge.
We’re doing it because the developers/owners of the 23 hectare site – where over 1,000 homes, 300,000 sq ft of office space, and retail and leisure facilities are planned to be built – can’t raise the cash they need elsewhere.
So the “Bank of You & Me” (the council) is stepping in.
If senior councillors give the green light at a meeting on Wednesday (19th June), we’re going to borrow the £9.9m needed to get some of the key infrastructure work around the site done, and the site owner will pay us back before October 2027.
Now, whatever you think of the idea of the council acting as a “lender of last resort” for a commercial enterprise, you’d think that us local taxpayers, as the most important shareholders in the “Bank of You & Me”, might at least be provided with decent info about who’s benefiting from our generosity.
In the case of Kirkstall Forge that’s not happening.
The only information we’re given about the site owner by the council is that it’s a property development company called GMV Twelve registered in Jersey, with a parent company, GMV Holdings Ltd, registered in Gibraltar.
“Further information on the companies involved can be found within the exempt Appendix B,” a council report prepared for next week’s meeting says. So it’s a secret.
Search for the two companies on the internet and you’ll find … nothing: no company profiles, no lists of directors, no financial info. Nothing.
Now, the loan we’re taking out for them isn’t the only boost from the public purse that this off-shore operation is getting to kick-start its stalled private-sector project at Kirkstall Forge.
GMV Twelve has also successfully bid for up to £5m in financial support from one of the pots of public money that’s administered locally by the Leeds City Region Local Enterprise Partnership (LEP).
That’s up to £14.9m in all from the Leeds public purses – and we know nothing about the beneficiaries, apart from the fact that they’re registered in two of Britain’s offshore tax jurisdictions.
Is it just me, or is that lack of transparency a bit worrying?
But it’s not. It’s pretty standard for what we get locally when public money is used to help commercial projects.
Take the LEP, a public-private partnership body that meets behind closed doors and is subject to little if any outside scrutiny. It has so far handed out £100m in financial support to businesses in the region through one of its pots of public money, the Regional Growth Fund.
Ask which companies have received how much, and they’ll tell you: “information on business bids the LEP supported cannot be disclosed due to commercial confidentiality”.
Scrutiny of decisions
The trouble is there’s plenty more of this public-private investment stuff on the way.
If Michael Heseltine and his acolytes in the north get their way, a further, large-scale devolution of public funds will be heading from central government to the largely unaccountable LEPs, including ours in Leeds. Maybe as soon as next week in an announcement from the Chancellor.
That’s potentially loads more public money dished out and, if past experience is anything to go by, no public account given of who it’s going to or what for.
Then at the end of this month a new regional investment fund is being launched, with £6m of our Leeds council cash helping to start it off. The aim of this branch of the “Bank of You & Me” is to offer commercial loans of over £1m to private sector projects that can’t raise the finance they need elsewhere.
No indication in the paperwork published so far that there’s going to be any serious scrutiny of its decisions or sharing of information about its loans with the public.
Whatever you think of the Heseltine/LEP route to growth and employment (this may help you make up your mind), would it be so difficult for our council leaders to do the following?:
* Tell us who is making these decisions with our public money. Who’s on the investment panels? Which “expert external advisors” are helping to assess the applications?
* Make it a condition of every application for council/LEP/etc cash that the applicant agrees that details of the project, the company and the amount it receives will be published
* Tell us whether the projects turn out to be any good. Did they achieve what they promised? Has our money been spent well?
Go on, guys. You know you’ll all feel better about it if you do.