Council defends cash handouts to small businesses.
Byline: Simon Gilbert News reporter email@example.com
A PS50MILLION council fund set up to help businesses has given just PS10.5million to private firms during the past 11 months.
But Coventry City Council officials insist the success of the Coventry Investment Fund (CIF), launched in February, should be measured by jobs created and funding it helped companies access - including from other sources.
The council says it has actually helped CIF applicants secure in excess of PS115million indirectly and helped to create 628 jobs.
CIF figures show the fund has directly invested a total of PS15million - but almost a third of that has been used to fund council projects, such as Friargate.
Labour councillors want to use PS16million of the fund to finance a social housing project in the city. That would mean over half of CIF money used would have been put towards the council's own projects.
The fund has received 48 applications since it was launched, in areas such as retail and officespace, while just eight have received CIF money.
But Martin Yardley, the council's director of place, said applications to the fund often resulted in other finance being sourced at better rates as the CIF application was able to operate as a "back stop".
He added that the application to the fund often acted as the starting point for the council to be able to offer firms other support such as assistance with applying for regional or European funding.
He said: "If you took the figures alone, it might look like a bad news story. But if you look closer, the opposite is true.
"Take Brown's Lane; we agreed CIF funding for that project of around PS600,000, but because of that they were able to negotiate a better deal and more money from another lender."
Asked whether the council should be using so much CIF money for its own projects, Mr Yardley added: "Look at the Kick-Start scheme at Friargate. That will bring PS11.6million extra a year to the city in business rates.
"If there's a council scheme that will drive up business rates, that's a perfectly legitimate scheme in my mind.
"There's no incentive for us to use the money ourselves. We don't lose it if we don't spend it and we get a much greater return by investing the money with private business."
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|Publication:||Coventry Evening Telegraph (England)|
|Date:||Dec 15, 2014|
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