Where's the contract for unorthodox bus depot purchase?

An FOI reveals the new West Northamptonshire Council does not hold the copy of an agreement to purchase the bus depot site in Northampton

A crucial legal document detailing the financials of Northampton Borough Council’s  (NBC) unorthodox purchase of a key regeneration site appears to have gone missing.

A Freedom of Information response from NBC’s successor authority West Northamptonshire Council (WNC) says the contract document, which sets out just how much the former borough council paid First Bus for its St James’s depot in March 2014 before then selling it on to shoe firm Church’s, is not in its possession. The response did however reveal the authority sold the 4.5 acre site in St James Road to Church’s that same month for £1.75m.

NN Journal asked WNC’s press office six days ago why the contract is not held by the council and asked for the financial details of the sale to be put into the public domain in the interests of transparency. At 8.30pm last night a media officer sent a statement which said:

“We are investigating the records of the former Northampton Borough Council to establish what it paid for the site. We expect to be able to release the information once it has been identified.”

There are suspicions the authority, which at the time was led by Cllr David Mackintosh, may have sold the asset on for a financial loss to the shoe firm immediately after it gained ownership of it.

A report to the cabinet in September 2013 suggested this might be the case, as it said First Bus wanted more than it was worth for employment uses. An earlier offer made by Church’s to First Bus (apparently over the market value) was rejected. The report said the council could get involved and any financial loss incurred by the purchase and sale by the council could be made up by later business rate charges or paid for by money given by regeneration agency SEMLEP.

So in an unusual arrangement the authority decided to act as the middleman in the deal to help move forward economic regeneration. Church’s, which was established in the town in the 1870s, has its headquarters at an adjacent site and had intended to use this new location to build a new factory. The site was part of the Northampton Waterside Enterprise Zone and was among a number of schemes promoted by the authority to regenerate the town.

The report that went to the cabinet said:

“There may be net capital and/or revenue costs incurred in relation to the proposed transaction. It is not possible to quantify with certainty what this sum may be at this time.”

The minutes do not report any of the cabinet, which included current WNC councillor Mike Hallam, asking any questions about the scheme, or scrutinising any part of the deal.

Authority was delegated to Stephen Boyes, the director of regeneration and planning to approve the terms of the deal in consultation with cabinet member for regeneration Tim Hadland, chief finance officer Glenn Hammons and monitoring officer Francis Fernandes.

Cllr Tim Hadland was reported in the minutes as saying the expansion of Church’s would be ‘very good news for Northampton’.

However since the 2014 acquisition, the site has been boarded up for several years and Church’s said two months ago that changes in the marketplace had led to ‘unforeseen delays’.

The FOI response to a enquiry - put in by a member of the public following NN Journal’s exclusive story raising questions about the sale - said:

“I confirm we do not hold a copy of the agreement to purchase the site. 

“We do however hold a copy of the agreement to sell the site, a copy of which is attached.” 

The contract, which is dated 6 March 2014, has been heavily redacted and WNC’s Information Governance Team has said disclosure of the blanked out information would adversely affect the confidentiality of the proceedings and can also not be shared due to commercial information. 

The team said it had weighed up the public interest factors of whether disclosure would be consistent with policies for greater transparency and accountability of local authorities against other factors including protecting confidential information and the relationship of trust between a council and whomever it enters into an agreement with.

The redaction makes it hard to fully understand the nature of the sale agreement but it states the sale price to Church’s was £1.75m. 

As part of the transaction a small parcel of land owned by the Homes and Communities Agency (the government) was also transferred to Church’s. The arrangements of this deal are unclear as are any clawback arrangements if Church’s was to sell on the land at a future date. This section of the contract is fully redacted.

The FOI requester had asked the authority to detail the monies paid to purchase the site, but this has not been provided. The figures should have been included in the accounting log for the 2013/14 financial year. This is not in the public domain, but should be readily accessible to the new council.

The Church’s plan was agreed in September 2013 just two months after the now notorious July 2013 deal which saw the authority go on to lose millions of taxpayers cash by loaning Northampton Town Football Club £13.5m funds to re-develop its stadium and build a hotel. The authority had not done its due diligence on the scheme or seen a business case from the football club before transferring the millions. The money went missing and the authority has been trying to recoup the funds for a number of years. 

On Friday (June 18) Northants Police announced that seven people had been charged in connection with the investigation into the missing money. 

They will appear at Northampton Magistrates' Court on Friday, July 16, in respect of offences under Section 54(7) of the Political Parties, Elections and Referendums Act 2000. Anyone who donates a sum of over £500 to a political party is required by law to give details of the source of the funds and it is alleged this was not done.

The defendants are: Nutan Bhimjiyani, aged 60, and Sharad Bhimjiyani, aged 65, both of Headstone Lane, Harrow; Nirav Vinodray Sheth, aged 47, of Uppingham Avenue, Stanmore; Gary Platt, aged 65, of West Drive, Harrow; Alan Mayfield, aged 64, of Hill Farm Road, Chalfont St Peter, Gerrards Cross; Leonard Western, aged 70, of Holmside Rise, South Oxley, Watford; Parekh Brijkumar, aged 65, of Broken Gate Lane, Denham.