Cost of failed loan to Northampton Town nearer to £17 million, 'absolutely furious' opposition leader claims

The cost to the people of Northampton of the failed loan to Northampton Town was close to £17 million, the leader of the Labour group on the borough council said on Monday night.

The council was discussing the highly critical report into the borough council's handling of the failed £10.25 million loan to the club in 2013 and 2014. Independent auditors, KPMG, found a series of serious failings and made a number of recommendations.

It was one of the last meetings before the borough, and other local authorities in the county, will be scrapped in favour of two unitary authorities.

The debate was opened by the current leader of the council, Councillor Jonathan Nunn, who repeated his previous apologies on behalf of his predecessors to the people of Northampton.

But Councillor Danielle Stone said apologies were not enough and that there needs to be some form of restitution and consequence for those involved.

She said she was absolutely furious about the "huge consequences" as a result of the failed deal.

"We need to be honest about the scale of what we have lost," she said.

Councillor Stone broke down how she believes the issue has cost taxpayers, from the loan itself and interest to the amount of money spent investigating and trying to recover the loan. The total, she estimates, is around £16.3 million. In addition, there was officers' time which took the total to more than £17 million, she said.

"There is a huge consequence for the borough, but what is the consequence for those that allowed it to happen and for those who made it happen?" Councillor Stone asked.

Referring to a section of the report that revealed that the deal included a clause that meant £5 million of the loan did not have to be paid back, Councillor Stone described it as "astonishing and absolutely extraordinary".

The report by KPMG referred to a lack of scrutiny for the overall project. "This project was championed by the former Leader...it appears to have been agreed without having been subject to any robust challenge by his fellow Cabinet members," the KPMG report stated.

Liberal Democrat Councillor Sally Beardsworth said she was concerned that cabinet members at the time knew so little about what was going on and called on them to "put their hands up and admit they weren't doing their jobs properly or asking the right questions".

Councillor Beardsworth said it was very sad that the last full council should be finishing with a debate on the "terrible, terrible decisions of the past".

Councillor Jane Birch listed all the things that the loan, and the additional money spent dealing with the consequences of it, could have been spent on in Northampton. Councillor Birch said lessons had to be learnt for the future and that independent chairs of committees such as overview and scrutiny should be appointed by the new authority.

The current leader of the Conservative administration, Councillor Jonathan Nunn, said he already issued an apology on behalf of his predecessors and he reiterated that sincere apology again this evening.

"The granting of the loan was done in a woeful and badly disappointing way," he said.

Since joining the administration in 2016, after the fallout of the loan, he said a significant amount of action had taken place and good governance was a "day in, day out" preoccupation of the last four years.

"We have not sat on our hands. Decision making has been criticised, what cabinet members did and did not know. All cabinet members are now briefed, can ask questions and no cabinet member arrives at a meeting without being fully aware of the [background]," he said.

Councillor Nunn said there had been a significant change in culture and the administration was now one that listened to people's concerns.

An additional action plan has been created following the KPMG report and Councillor Nunn said the recommendations would continue with the new authority for this area, West Northamptonshire Council.