AT A time when every penny counts, it has been confirmed that a loan of £6 million to an English council that is virtually bankrupt has been returned to Blaenau Gwent coffers.
In October last year it was revealed at a Blaenau Gwent County Borough Council scrutiny committee meeting that the council had loaned £6 million to Thurrock Borough Council in Essex during the 2021/22 financial year.
Over the summer it was announced that Thurrock is drowning in £1.5 billion worth of debt, after failed investments in energy schemes.
In September, the UK Government appointed Essex County Council as commissioners to effectively run Thurrock.
The £6 million loan was due to be paid back to Blaenau Gwent at the end of November 2022.
Last autumn councillors both from the Labour ruling group and the Independent opposition had raised concerns that that there was risk that the money would not be repaid.
At the time finance bosses at Blaenau Gwent said that they had received “written confirmation” from both Thurrock and their regulators and were confident that the loan would be repaid in line with the agreement.
Council leader Cllr Steve Thomas said: “Thurrock Council repaid the loan and interest on November 30.”
In November, the renewable energy firm that Thurrock invested in, has entered administration owing them £655 million.
Thurrock helped Toucan Energy Holdings 1 (TEH1) finance 53 of the company’s solar farms in the UK.
Thurrock’s cabinet had said last autumn that they had repaid £177.5 million worth of the loans it had received from other authorities.
Just before Christmas the Conservative run council announced it has £469 million funding black hole for this financial year.
The council then issued a section 114 notice which means that it cannot balance its budget and is effectively bankrupt.
The s114 means that it can only spend its money on statutory services.
Local authorities have a legal duty to provide services such a social services, education, collecting rubbish, planning, housing, and highway maintenance.