What’s the £9.7m secret which Norwich City Council says must remain a mystery?
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Millions of pounds were earmarked to lend to a secret project at a behind closed doors council meeting, it has emerged, with City Hall refusing to reveal details of the mystery scheme.
Almost £10m was identified, when Norwich City Council set its budget in February last year, for 'strategic asset investment'. A year on and the money, which could have been borrowed or taken from taxpayers' cash, was never spent.
But the authority will still not reveal what it was earmarked for because it remains 'commercially sensitive'
The decision to potentially lend the money was taken 'below the line' at a full council meeting in December 2013 - which meant the public and press were excluded from that part of the meeting. The opposition Green group opposed the decision.
A year on and the investment has not been made, sparking questions in the council chamber over the merits of the scheme it was earmarked for.
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The council, which has a turnover of about £100m a year and has made £26m of savings over the past six years, stressed the money was not from a pot which simply sat unused for 12 months. The authority said it would have borrowed the cash or taken it from its cash flow.
At last week's budget setting meeting, Green city councillor Lucy Galvin raised concerns over the mystery millions and called for a cross party working group to review strategy and options for what the council invests in.
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She said the council had been asked to lend money to a project - initially up to £13m, but then reduced to £9.7m - to a project she had been told she could not name.
She said: 'The project did not go ahead and our papers say it is now not certain to go ahead. Risk is often linked to profit, but I am sure we can all agree that risk to public money needs to be rigorously assessed. It can be argued we have a duty to make money, but making money out of money in today's world is not as easy as it was.
'The plan that came to that secret meeting is still a secret one year on. How can it be right that public money is used in that way?'
The council's budget papers refer to a 'proposed commercial arrangement which is not now certain to go ahead', while the millions are not allocated for investment in the budget for the next 12 months.
Alan Waters, deputy leader of the Labour-led council, replied to Mrs Galvin: 'Whether one feels something should be above or below the line, we are constrained by statute.
'What one has to understand is that, in the circumstances we are operating in, we would always want to look at opportunities where we can invest our money. I don't deny that there's some element of risk, which has to be carefully assessed.'
He said the project was not yet concluded, so had to remain confidential.
While the council will still not reveal what the project was, the authority stated the investment would have been funded by borrowing money or through using money the council has in the bank as part of its cash flow.
A spokeswoman said: 'Currently, any surplus cash we have in the bank is invested to raise interest to provide income to the council.
'If we go ahead and invest in something, we then recoup interest, plus an amount in income on top. We would always ensure a good return on any investment.'
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