Debt-ridden Thurrock Council owes other Essex authorities millions

A council taken over by the government due its level of financial risk and debt owes at least £11m to other local authorities.

Thurrock Council, which was found to have debts of £1bn, lost control of its finances earlier this month.

Castle Point, Maldon and Tendring district and borough councils confirmed they had lent £3m, £2m and £6m respectively to the unitary authority.

Thurrock Council borrowed the sum and invested millions in solar energy.

It has been approached for comment, the Local Democracy Reporting Service (LDRS) said.

The extent of the authority's borrowing was first revealed by the Bureau of Investigative Journalism.

The scale of the financial and commercial risks facing Thurrock prompted the Department for Levelling Up, Housing and Communities to intervene earlier this month.

Essex County Council has now been given control of Thurrock's financial functions.

The district and borough councils said in statements that their inter-authority lending was a secure and common practice, adding the loans were repayable by May 2023 at the latest.

Castle Point Borough Council said in a statement: "Inter authority loans such as this are secured on the revenue of the borrowing authority and are the most secure form of investment available to Castle Point Borough Council.

"There has never been a case where there has been a default on the inter authority, local authority borrowing."

Director of resources at Maldon District Council, Chris Leslie, said in a statement that its investment was a short-term one, "which was placed in April 2022 and is due to be returned with interest in October 2022".

Carlo Guglielmi, Conservative, Tendring District Council's cabinet member for finance, said in a statement the authority had investments in Thurrock Council but nothing was outstanding.

The district authority's lending represented 6% of its total portfolio, all of which was due to be repaid within five months.

"We are not aware of any reason why Thurrock cannot meet its obligations, but will of course continue to monitor the situation closely," he said.

The former leader of Thurrock Council, Conservative Rob Gledhill, resigned on 2 September, as a consequence of the government stepping in.

Colchester and Brentwood borough councils told the LDRS they also had investments in Thurrock Council but did not disclose how much.

Basildon Borough Council recommended the LDRS send a freedom of information request to continue with the inquiry.

Find BBC News: East of England on Facebook, Instagram and Twitter. If you have a story suggestion email [email protected]