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Call for resignations over housing scheme which lost millions is rejected

PUBLISHED: 21:58 23 June 2020 | UPDATED: 22:07 23 June 2020

Mike Stonard, chairman of the Norwich Regeneration Company, cuts the ribbon to open the first of the Passivhaus homes at Rayne Park, Bowthorpe in 2018. Pic: Denise Bradley.

Mike Stonard, chairman of the Norwich Regeneration Company, cuts the ribbon to open the first of the Passivhaus homes at Rayne Park, Bowthorpe in 2018. Pic: Denise Bradley.

Archant

A council-owned housing company - which is facing a loss of £6m in public cash on its first project - is to be lent up to £21m to stop it from collapsing.

Paul Kendrick, Labour city councillor. Pic: Archant Library.Paul Kendrick, Labour city councillor. Pic: Archant Library.

Amid calls for two councillors who sit on the board of Norwich City Council’s Norwich Regeneration Limited (NRL) to resign, the council agreed to lend the company m money to help complete homes being built in Bowthorpe.

A leaked council report revealed how the authority lost almost £3m on the first 80 houses at its Rayne Park development, and is set to lose £2.8m on the rest of the initial 150 houses.

But at a virtual meeting of the city council tonight (Tuesday, June 23), the council voted to agree to the loan, while calls for the resignation of Labour councillors Mike Stonard and Paul Kendrick from the board of the company the council set up were rejected.

MORE: Council owed £6m from housing firm which made ‘financial loss’

Alan Waters, council leader, said authorities across the country had set up such companies as vehicles for housing due to the government’s failure to deliver homes.

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He said: “The principle recommendation is to provide the loan facility to allow the company to continue the valued work at the heart of our recovery plan, which is to provide much needed housing to different people across the city.”

He said the loan would help the company “build its way” out of its difficulties and said: “There’s humps and bumps in the road - that’s life. The opportunity now is to get us to a better place and I am sure we will be able to do that.”

However, Green city councillor Paul Neale said Mr Kendrick and Mr Stonard should resign as board members of NRL or as members of the city council’s cabinet.

He said it was a “flagrant conflict of interests”. He said: “How can the cabinet members make decisions on financing NRL while sitting on the board of NRL and effectively asking themselves for money.”

Alan Waters, leader of Norwich City Council. Pic: Jeff Taylor.Alan Waters, leader of Norwich City Council. Pic: Jeff Taylor.

But Mr Stonard, who declared an interest and did not take part in the decision to loan the latest money, said after that debate that he would not resign. He said the Greens had “fundamentally misunderstood” the set up.

He said: “At every decision that has been made affecting the company financially, I have absented myself from the meeting or not taken part in the discussion, to ensure there has been no conflict of interest.”


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