Mid Devon's finance leader quits Conservatives

Criticism of council's property company is "unreasonable"

Mid Devon’s lead councillor for finance has slammed “unreasonable” criticism aimed at its residential property company and quit the Conservative group so he can work across party lines.

3Rivers Developments Ltd, wholly owned by Mid Devon District Council, was set up in 2017 as a way of building “high quality” local homes while generating a profit for the council.

But it has faced criticism, including about its viability and a perceived lack of transparency. Detailed information relating to the company’s performance is often confidential and discussed in closed meetings that keep out the public and press.

People in charge have claimed this is necessary because of the confidential and commercially sensitive nature of the reports, which could hamper the firm and help competitors.

The company is facing a substantial loss, last reported at around £600,000, for one of its long-standing projects at St George’s Court in Tiverton, though the council says this is also helping to regenerate the area and that three other developments in Mid Devon generated a combined gross profit of £278,000.

Last month, the council’s scrutiny committee ‘called in’ a decision by the ruling cabinet to increase the firm’s loan agreement by just over £2.2 million to cover overspends on two projects. It believed more due diligence is needed, including a review from the audit committee.

However, the cabinet later rejected the recommendations and stuck by its original decision.

In a statement during a district council cabinet meeting on Tuesday [4 October], Councillor Andrew Moore, cabinet member for finance, claimed that “over the past couple of months, we’ve seen the active resumption of what appears to be a concerted campaign against 3Rivers.

“Whenever 3Rivers appears on the agenda, there is now an apparently deliberate, near relentless push to take every possible action to thwart reasonable progress and decision making.

He claimed the scrutiny call-in was “perhaps the latest in a series,” which has also included “petty bureaucratic points, decision-delaying tactics, emotionally charged questions, baseless and provocative accusations, personal attacks, irrelevant challenges.”

Cllr Moore also believes there had been “wholly ill-informed public statements by members, questionable planning decisions and questioning and discussion often completely off the point of the decision at hand.

“This has gone way beyond healthy challenge to the point of being completely unreasonable.”

Claiming it was “obviously politically motivated” and causing “outright damage” to the company and the council, Cllr Moore announced he is leaving the Conservative group to continue in the finance cabinet role as a “wholly unaligned independent member.”

He explained: “I will distance myself from all the political infighting to work across party lines for the benefit of this council and residents,” adding: “I’m not leaving the Conservative group through dissatisfaction.”

Cllr Moore also said that following the comments made at scrutiny, the authority will “consider governance improvements better to achieve effective council decision making to support a commercial business operation.”

The chairman of Mid Devon’s scrutiny committee, Cllr Simon Clist (Lib Dem, Upper Culm), was approached for comment but did not respond by the time of publication.

Andrew Jarrett, Mid Devon’s deputy chief executive and the council’s shareholder representative, said the St George’s Court project had to be taken on directly by the authority after “a number of developers walked away from the site due to issues around viability and deliverability.”

He claimed “commercial confidentiality” meant he could “only confirm that the St George’s Court project is likely to finish over the initial council approved budget, predominantly due to covid pressures (forced site closures, impact on supply/availability of labour and associated cost increases).”

Mr Jarrett added it has endured further challenges, including the loss of the main project delivery contractor and the current cost of living crisis.

“Despite these challenges it is important to remember that this development has always been seen from a regeneration perspective, in order to improve a difficult and challenging site and bring more customer footfall to an area of the town centre where an increased number of shop vacancies are occurring,” he said.

A revised business plan for 3Rivers is due to be considered by the council before Christmas.