Wokingham Borough Council will be accused of a “material and significant deception” at tomorrow’s full council meeting.
In the section devoted to public questions on Thursday (January 18), Philip Meadowcroft will ask Cllr Imogen Shepherd-Dubey, executive member for Finance, to clarify the situation regarding Wokingham’s loans to other authorities.
He will say: “During the first nine months of 2023 Wokingham Borough Council made £75 million worth of loans to cash-strapped local authorities.
“Councillors and officials have repeatedly emphasised to me that these loans, including the £10 million lent last June to the bankrupt Woking Borough Council, were underwritten or guaranteed by the Treasury.
“They have referred me to sections 6 to 13 initially (then just Sections 6 and 13 only) in the Local Government Act 2003 in support of their entrenched belief that Treasury guarantees for these loans actually existed.
“Nowhere, however, in Section 6 or 13 do the words “guarantee” or “underwritten” or “Treasury” or “Government” appear.
“Councillors and officials appear to be persisting in misleading and deceiving Full Council, and the Wokingham residents and council taxpayers they represent, with false and misleading statements justifying their actions which they cannot actually show and prove to be true.
“This is tantamount to a material and significant deception.
“When and how, please, will the truth be told, together with an apology?”
On June 8, 2023, Wokingham made a £10 million loan to Woking the day after the Surrey council issued a section 114 notice – effectively declaring bankruptcy.
That loan is due to be repaid in March along with £323,000 in interest.
Mr Meadowcroft asked a similar question at November’s full council meeting.
Cllr Shepherd-Dubey replied, saying:”There has never been a situation where a council in a Section 114 state has defaulted on its payments, and other councils are one of the safest places for us to invest.
She added that a council defaulting on its payments would only happen if central government was unable to cover the costs.
“It doesn’t matter to us whether a council is in a Section 114 state or not because it’s all underwritten by the Treasury,” she said.
