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Labour leader: £75m loan allegation is 'Tory smear'

Coun Grant Davey, left, and Coun Peter Jackson.
Coun Grant Davey, left, and Coun Peter Jackson.

The Northumberland Labour leader has hit back at a ‘Tory smear’ after allegations that his administration planned to loan £75million to a developer.

It relates to the highly-contentious Dissington Garden Village (DGV) site, over which developer Lugano has launched a High Court action against two senior councillors, the chief executive and the council itself.

At last month’s full council meeting, Coun David Bawn asked: “It was stated in the early months of the new administration that the former Labour/independent council had been close to agreeing a £75million loan to a developer to build houses in the Ponteland area.

“When this was disclosed at a full council meeting, an offer was made to share the information with the current leader of the opposition. Did he ever take up the offer to see the details of a £75million council loan to a multimillion-pound property developer based in Switzerland?”

Council and Conservative leader, Peter Jackson, replied: “I do remember when this was talked of in the full council meeting and there was general shock about this issue.

“For this council to effectively offer a £75million loan to a private developer for a development without full planning permission was such an incredibly risky thing to do.

“It showed the extent to which this council had been playing fast and loose with taxpayers’ money. Fortunately that’s stopped now, but we’re still picking up the pieces as we go along.”

He added that the offer to view the information had not been taken up.

Coun Bawn then said the previous council leader denied all knowledge of the loan and asked if it was appropriate for the chief executive to approach a private company without consulting the leader of the council.

Coun Jackson described this as ‘pretty extraordinary’ and said that ‘you’ve got to question the motives of certain members of the Labour group who constantly champion that particular planning application and that particular company’.

But Coun Grant Davey, leader of the Labour group and former leader of the council, has now taken up the opportunity to review the information.

He said: “Coun Jackson and his acolytes are determined to smear the Labour party in Northumberland and his fake claim that the former administration had agreed to loan a property development company £75million for the DGV site was a classic Conservative two-for-one smear.

“Not only did they know their smear was wrong, but they knew that there was no agreement reached. They were also wrong to state this had gone any further than a conversation between two chief executives.

“I’ve now reviewed Coun Jackson’s so-called evidence, which he’s kept secret like so many other things in this authority, and it doesn’t amount to a row of beans.

“The leader is bringing the authority into disrepute when he plays politics with commercial communications and he clearly thought that he could smear Labour and a private company that he clearly has an unnatural dislike for in one fell swoop.

“I have no doubt that they will deny this, but I’m happy for all information to be published transparently so residents can see their £75million smear is fake.

“I’m shocked that the CEO allowed this politicisation of council business to happen and I assume it happened without her knowledge, but I would expect an apology for this deliberate smear.”

Ben O'Connell, Local Democracy Reporting Service