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Reorganisation puts troubled county's HQ sale on hold

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A buyer has been found for Northamptonshire CC’s £53m headquarters – but the sale is being held up by discussions over local government reorganisation and confusion over the use of capital receipts to fund budget pressures, it has emerged.

In a paper due to go before the county council’s cabinet today updating members on the financial pressures facing the local authority, finance director Mark McLaughlin said the proposed sale and leaseback of the One Angel Square building had not been factored into the council’s budget calculations.

“A conclusion had been reached on negotiations with a buyer of One Angel Square however after consultation with the consultees identified in cabinet’s earlier decision, the executive director has taken the decision to pause the sale process at this stage,” Mr McLaughlin’s report said. “There are two reasons for delaying a final decision on the sale.”

He said statements in inspector Max Caller’s report and subsequently made by housing and communities secretary Sajid Javid mean “there is a likelihood of significant changes to local government structure in the county”.

“As such it is appropriate to consult with local partners on whether this remains the appropriate time to enter into a long-term leaseback arrangement,” said Mr McLaughlin.

Mr Caller called for the county to be broken up into two unitaries, while the Ministry for Housing, Communities & Local Government is also considering a proposal that would see a unitary created covering “part of a county and one or more adjoining districts in an adjacent county”. Due to the fact South Northamptonshire Council has shared all staff with Cherwell DC in Oxfordshire in a process which began in 2011, concerns have been raised that a cross-border unitary could have a “domino effect” on reorganisation not just in Oxfordshire but elsewhere.

Councillors and officers are now waiting for Mr Javid’s final decision.

Another reason for the sale of One Angel Square being put on hold is the fact Northamptonshire CC is “continuing to receive financial and legal advice on the use of capital receipts, and in particular, any receipt from the sale of One Angel Square”, said Mr McLaughlin. Once it has received that, the council “will be better placed to make a balanced judgment as to whether to proceed with such a sale on completion of this process”, he said.

Mr McLaughlin’s final quarterly report for the 2017-18 financial year confirmed an expected £16.7m overspend. LGC reported last month how the council will “effectively exhaust” its general and earmarked reserves in order to balance its budget.

A need to find savings totalling £105m between 2018-19 and 2021-22 has been identified.

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