Saffron Walden Labour Party is calling for a complete rethink of the investment strategy, warning that Uttlesford is taking major risks by seeking to raise £100 million in debt without any comprehensive investment strategy.
Speaking at the full council meeting on Thursday, spokesman Daniel Brett said: “The investment programme lacks a coherent strategy, ignores emerging risks, has no professional asset manager oversight and is focused on one asset – the Chesterford Research Park – which is in one niche sector and in one ward in the far north of the district.”
Uttlesford agreed to go ahead with borrowing £100 million in addition to the £50 million already borrowed for the CRP investment, backed by the Tories and three R4U councillors. It will also set up an investment committee comprised of councillors to consider how to spend the money.
Speaking after the meeting, Daniel Brett said: “We have to acknowledge that the council is forced to borrow to invest due to massive cuts in local government spending by the Tory government. The council is staring down the barrel of a gun because it is trying to be an investment manager without professional expertise.
“A fat round number has been plucked from the air with some vague aspirations determined by amateurs in the council with no idea of what return they are seeking or how they will achieve it. Uttlesford Tories are determined to allocate most of the investment to the CRP regardless of risk – Brexit in the short-term, over-supply of research park property in the medium-term and the long-term economic cycle.
“Labour believes an investment strategy, drawn up by professional asset managers, is crucial. We believe in spreading risk across a range of asset classes with varying risk exposure, including fixed income, funds managed by external asset managers and venture capital. There are far more investment targets that are worthy of consideration in Uttlesford, particularly as we have an international multi-modal transport hub in Stansted that the council fails to capitalise on.
“Ultimately, we believe Uttlesford should approach other councils in Essex to build a £1 billion sovereign wealth fund which would have more financial muscle and can afford the asset management expertise to deliver higher returns with risks properly hedged.”