Agenda item

To receive a report from the Cabinet Member for Economic Development and the Corporate Director of Growth, Environment and Transport on a proposed decision to launch a scheme to invest recycled Regional Growth Fund loan repayments

(1)       Mr Bowles declared an interest in this item as he was a member of the Tiger Strategy Board for the RGF Tiger Fund which is a strategic board and does not make decisions on applications received from businesses.

(2)       Mr Kite declared an interest in this item as he was a member of the Tiger Strategy Board and the Tiger Approval Panel which makes recommendations to Kent County Council, as the accountable body, on the funds awarded, or not, to business.

(3)       As they considered the interests were not Disclosable Pecuniary Interests or Other Significant Interests, as defined by legislation and the Council’s constitution, they remained in the meeting. 

(4)       Jacqui Ward (Regional Growth Fund Programme Manager) introduced the report which asked the Cabinet Committee to consider and endorse or make recommendations to the Cabinet Member on a proposed decision to launch a new scheme to invest recycled Regional Growth Fund (RGF) loan repayments.

(5)       Mrs Ward said that since 2011 Kent and Medway had benefitted from government investment of £55 million from the RGF and this had supported the Expansion East Kent, Tiger and Escalate business loan schemes.  All of the original funding had been disbursed but as loans were repaid about £5-£7 million each year would be available for reinvestment in companies with growth potential.  Mrs Ward also said that the Tiger Strategy Board and others had been consulted about the proposal and there was interest from the business community in the proposed Kent and Medway Business Fund.

(6)       Mr Smith (Director of Economic Development) said that on reflection it would be more realistic to launch the new fund in January 2017 and not December 2016 as suggested in paragraph 4.1 of the report.

(7)       In response to comments and questions officers said:

(a)       The report was intended to set out the principles of establishing a fund and not to describe the mechanics of the three funds currently in place or the detailed operation of the proposed new scheme;

(b)       The money to be recycled came from repayments on loans that had been given over the previous three years;

(c)        £6.6 million was currently held in the bank;

(d)       It was estimated that around £39.5 million would be repaid by 2021 meaning that up to £5-£7 million would be available each year for re-investment;

(e)       Loans would be interest free but 3% would be charged on each loan to cover administrative costs.

(8)       The Cabinet Committee was broadly supportive of the proposal to recycle Regional Growth Fund monies but were concerned about the proposed governance arrangements particularly in relation to authority to sign off loans. 

(9)       Mr Bowles proposed that further consideration be given to the governance arrangements and that a further paper be received by the Cabinet Committee at its meeting on 12 December 2016.  This was seconded by Mr Marsh and agreed by the Cabinet Committee.  

(10)     Resolved to recommend to the Cabinet Member for Economic Development that:

(a)       This report be withdrawn; and

(b)       A further report which addressed the concerns of Members be presented to the next meeting of the Cabinet Committee on 13 December 2016.