Struggling Lancashire County Council to write off Â£500k from failed business
Cash-strapped Lancashire County Council is preparing to write off half a million pounds ploughed into a failed business.
The authority is preparing to abandon hope of recovering its share in the failed VIA partnership - a company set up by Lancashire, Blackpool and Blackburn councils to provide work experience places and job training.
The firm, which traded as Connexxions went into administration in December with the loss of more than 70 jobs.
Blackpool Council has already decided it will never get back a £300,000 investment.
Now Lancashire County Council has confirmed it will write off a sum in the region of £500,000.
County Hall is currently consulting on proposals to shut more than 200 libraries, youth and childrens’ centres and other facilities across the county in a bid to save £260m.
And campaigners battling to save libraries in Wyre have been left fuming by the VIA write off.
Coun Andrea Kay said Lancashire chief executive Jo Turton and council leader Jenny Mein must take ultimate responsibility for the failure.
She said: “It’s unbelievable, it’s staggering. When they are talking about saving money, about closing facilities how can this be justified? How many libraries could this keep open?
“Every effort should have been made to get this money back. A private business certainly wouldn’t consider writing off such an amount.
“Somebody had to be held to account for this.”
Coun Kay’s anger is not just directed at the County Hall leadership.
“The chief executives of all three councils should be called to explain what has happened.
“How could this company, under the control of local authorities, have been allowed to fail?
“Jenny Mein, the leader of the county council, has questions to answer too.”
Blackpool North and Cleveleys MP Paul Maynard, who last week took the battle to save Thornton and Cleveleys library to Parliament, branded the authority ‘financially incompetent’ .
He said: “This is one more example of the incompetent management of county council finances.
“Too much of what Labour is cooking up at Lancashire is a consequence of their own failure to effectively and properly manager taxpayers’ money and taxpayers are paying the price.”
The VIA partnership, whose directors include high ranking Blackpool Council executive Alan Cavill, collapsed in December following an inadequate Ofsted inspection.
As a result hundreds of work experience placements were cancelled and the programme has now effectively stalled.
County Hall confirmed the write off was being planned and had only been considered after all other options had been exhausted.
A spokesman said: said: “I can confirm the county council is planning to write off a sum of around £500,000 in relation to the winding up of the VIA Partnership.
“When issues with the company’s cash flow became evident, the county council, along with the company’s other shareholders, actively explored the options for a management buyout or sale to a third party.
“It only became clear in early December last year that there was no realistic prospect of a sale of the company at which point the decision was taken to place VIA into administration.”
Jenny Mein was asked to comment but was unavailable.