11th hour meeting planned to save vital Melton bypass funds

It appeared that an argument between Leicestershire County Council and Melton Borough Council over how they should share the risk of forward funding the scheme before money is recouped via housing developer contributions would mean the HIF grant could not be accepted before this week’s deadline.

County Hall decided at a cabinet meeting on Tuesday that it could not afford to underwrite the entire £55million required to forward fund two new schools and the building of the road and they called on the borough council to take on a significantly higher share of the risk than the £1million they were proposing.

But borough councillors confirmed at their cabinet meeting yesterday (Wednesday) that they could not go above the £1million figure because it would risk bankrupting the council.

However, borough council leader Joe Orson told colleagues he, along with the chief executives of both councils, would be meeting with a senior official from Homes England - the government body which has offered the grant - to discuss if they can still accept the money.

He said: “The county council wants to go ahead with this southern link, and I know they have put a lot of resources into this, we want it of course and I just hope we can come up with a solution at this meeting.

“I can assure everyone that Melton Borough Council will do our utmost to make it work.”

After the council’s director for corporate services, Dawn Garton, told the meeting that underwriting the risk by more than £1million would run the risk of making the council financiallly unsustainable, Councillor Orson agreed that it made no sense to take on more of the risk.

He said: “It is strange that Leicestershire County Council, which has a budget of £500million, is saying the risk would be too much for them but they want to transfer more of it to a council which has only a £5million budget.”

Deputy leader, Councillor Leigh Higgins, agreed and pointed out that if the borough council was to underwrite a hypothetical £20million of the cost of the scheme it would result in a Council Tax rise of 600 per cent to service the debt.

He told cabinet colleagues that the council had an impressive record of securing Section 106 developer contributions from house builders and that this should assure the county council that they would be able to recoup their outlay when the proposed houses are built in the south of the town.

The meeting heard that two developers - Greenlight Developments and Davidsons - had written to commit to the housebuilding schemes in a bid to add further validation in the project.

This is the second time the £15million government grant towards the southern link has been under threat of being lost.

Homes England extended the deadline to the end of this week after the county council declined to accept the money earlier this year because it said the borough council’s masterplan for development in the Southern Sustainable Neighbourhood, which would help pay for the south link road, was not adequate.

Both councils have worked together with developers to amend the masterplan to a point where it is acceptable to all parties.

Ahead of the last ditch meeting with Homes England, the county council has underlined its commitment to securing the £15million HIF grant.

County Hall says it needs reassurances from the borough council that it will get its money back from developers because it has a duty to deliver effective services for the whole of Leicestershire and not just Melton.

Nick Rushton, leader of the county council, said: “To be clear, our role is to build the roads and schools and we need district councils to fulfil their role.

“And their job is to put the right plans in place to guarantee they will secure the money from developers to pay for it.

“We are asking Melton Borough Council to take responsibility for securing the necessary developer contributions.

“If they do that, there should not be a problem.

“It would not mean Melton Borough Council underwriting the £70million costs of the road and schools, as has been claimed.

“We’ve had to take the lead with developers in making this project viable.

“And we have to remember the bigger picture – this is about getting the right infrastructure for our residents.

“I hope Melton Borough Council will reconsider their position, particularly if they have for any reason misunderstood what the county council is asking.”