By Andrew Rowson
Cambridgeshire County Council denies statutory information inspection rights to the public and its own elected councillors.
In the last post, I speculated that Cambridgeshire County Council's (CCC) beleaguered housebuilding subsidiary, This Land Ltd, may have made a comprehensive loss of over £1m on each of the thirteen houses it sold in 2024-25. The calculation was based on the average sale price of the 23 houses the company sold the previous year, and on the assumption that all, or nearly all the company's revenue that year had come from selling houses, rather than selling its own land, which historically has made up 76% of its total sales. This Land Ltd has now published its audited financial statements for 2024-25, and the official figures are even more alarming. This Land did not sell thirteen houses in 2024-25. It sold just one: 61 Windmill Close, Over - for £463,543 on 24th May 2024.
Apart from £57,000 rental income, the remaining £5.23 million sales revenue came from land sales, further depleting the company's property portfolio with which it plans to trade itself out of its current mess.
This Land Ltd and its single shareholder, CCC, insist that the company will repay all its outstanding loans totalling £120m, plus interest (at least another £27m), by March 2029, which is now only three and a half years away.
All those repayments will have to come out of super massive profits, which the graph above shows is not This Land's forte. In the latest accounting year, the company reported a loss of £13.63m. Its net profit margin for the year was an impressive minus138%. As reported in a previous post, to achieve that miraculous turnaround, This Land would need to build and sell hundreds of houses every year over the next four years, all at exceptionally high profit margins, on the small amount of land it has left after selling most of it to proper housebuilders. The numbers clearly do not add up, and This Land's latest business plan is an arithmetic impossibility.
Riding roughshod over the law
In the circumstances, given the scale of This Land's losses and its outstanding debt, it is only reasonable for concerned members of the public and elected councillors who do not serve on the secretive Shareholder Sub-Committee to ask reasonable questions, challenge the figures we are allowed to see, and ask to see the supporting documents that might explain just how This Land plans to pull off the greatest turnaround in corporate history. CCC is having none of it.
In July this year, I asked to inspect documents relating to This Land during the statutory 30 working days inspection period under section 26 of the Local Audit & Accountability Act 2014. CCC's draft annual accounts include consolidated group accounts (pp144-155), which comprise CCC's and This Land's accounting records. Section 26 states that during the inspection period, any interested person may:
'inspect the accounting records for the financial year to which the audit relates, and all books, deeds, contracts, bills, vouchers, receipts and other documents relating to those records.'
That naturally includes This Land's draft accounts and all other accouting records, documents etc. relating to This Land's 2024-25 accounts, because they form an integral part of the county council's group accounts. CCC though has a different interpretation of the law. It asserts, without producing any evidence, that the group accounts and related documents are somehow out of scope of s26. The senior legal officer and Monitoring Officer at the council, Ms Emma Duncan, claims to have received external legal advice to support that illogical interpretation, but has not produced any evidence of it. I first asked Ms Duncan for that legal advice in July 2024. She ignored the letter. When I asked to see the evidence in July this year, the Chair of the Audit & Accounts Committee, Cllr Chris Boden, declared that it could not be produced because it might be subject to legal, professional privilege. A Freedom of Information request was raised, which the authority should have responded to by 26th August. Instead, it gave itself another four week extension period, citing dubious technical grounds. The exemptions the authority claims to be relying on were challenged last month, but the authority has so far declined to address the substance of the challenge, resorting instead to its well used tactic of issuing a ludicrous threatening letter, signed on this occasion by the Monitoring Officer herself.
Elected members also denied their statutory inspection rights
As for CCC's elected councillors, many of them are just as concerned about This Land Ltd, and keen to have information that might explain exactly how the company plans to make super-massive profits in the next four years, when its house sales have all but evaporated, and without any further financing from CCC to repay all its debt and loan interest without taxpayers' money being lost.
If there is a plausible explanation, it must lie in six appendices that have been concealed from the public under Agenda Item 4 in the July 24th meeting of CCC's Shareholder Sub-Committee.
Any elected member at CCC, regardless of whether they serve on the sub-committee, is fully entitled under section 100F of the Local Government Act 1972 to inspect and have copies of any and all of those appendices. Several councillors at CCC I understand have already asked to inspect them, but the Monitoring Officer has flatly refused their requests, apparently in breach of the statutory legislation.
Under section 5 of the Local Government and Housing Act 1989, the Monitoring Officer has a legal duty to ensure councils fulfil statutory obligations and apply their codes of conduct. This includes investigating and reporting on anything the authority does that has the potential to be an illegal action or any action that might count as maladministration. So what happens when the Monitoring Officer herself repeatedly breaches statutory obligations that should allow the public and elected members to inspect important documents relating to a wholly owned housing company that has lost £63.9 million in 9 years, sold just 77 houses, owes its shareholder £126 million (including unpaid loan interest from 2024-25) that it can never hope to repay, and which pays its chief executive £575,065 in a single year?