Agenda item

This report provides an update on the allocation of funds to companies in the format previously agreed by the Growth, Economic Development and Communities Cabinet Committee.

1.            The Growth Fund Programme Manager, Mrs Ward, introduced a report that provided Members with an update on the allocation of funds from the Expansion East Kent, Tiger, and Escalate schemes to companies in the format agreed by the Cabinet Committee.

2.            Mrs Ward said bad debt had increased as a result of one company that had gone into administration.   Members noted that the monitoring was one quarter behind and the process had been simplified which the businesses had welcomed.

3.            Mrs Ward noted comments and responded to questions by Members as follows:

Ÿ  Mrs Ward explained that there had now been four years’ experience of the three funds, Expansion East Kent, Tiger, and Escalate.  She said there were thresholds within the Red Amber Green [RAG] ratings and that a tolerance level may be introduced in programmes in the future.

Ÿ  A comment was made that if KCC was a private company investing in those companies it would not be happy with the results detailed in the report.  KCC should be expecting some social value from the investment.

Ÿ  A request was made for more feedback on the social value of the loans and more information on repayments.  Mrs Ward advised that the social value could be measured by the number of jobs created and the growth in the economy. She also said that that indirect employment, arising from the use of suppliers in the local area used by the business was now measured. 

Ÿ  With regard to repayments, targets and variations, some businesses repaid slightly earlier and some paid in full amount as one payment.   To allow variation of the contract the performance of the business would be monitored over three months and the projection of the next three months.  This would highlight any issues the business was having i.e. potential cash flow issues, sales forecast that was not met or an order that did not come through. 

Ÿ  A Member commented that he welcomed the RGF Programme and disagreed with the earlier comment “if KCC were a private company…” as these funds were set up to address the lack of funds to finance high risk companies.

Ÿ  A further comment was made that it would be interesting to know how KCC compared in terms of funding and social value.

Ÿ  It was suggested that KCC should be proud of these schemes and their achievements.

Ÿ  Mrs Ward said that the criteria did not specify the number of jobs to be created.  She agreed to forward information on the cost per job created to Members outside the meeting.

Ÿ  A Member considered that there should be more positivity regarding the social value, price per contract/value to community and gave the example of a company in Dover that had gone from strength to strength employing local people.  Mr Dance reminded Members that when the money was repaid that money was reinvested in other companies.

4.            RESOLVED that:-

(a)    Mrs Ward would forward information regarding the cost per job created by those companies in receipt of funding from the three schemes;

(b)    the comments and responses to questions by Members and the report be noted.