Liverpool City Council “failings” around an Everton FC loan may mean that thousands of pounds will be written off.
Government appointed commissioners have released a report which shows that the authority have incurred significant costs relating to the possibility of loaning the football club money to fund their Bramley-Moore Dock development.
The report notes that due to “failure of governance” some of the costs would not be recoverable.
The report has been released ahead of a cabinet meeting next week and confirmed that the authority had incurred significant costs in order to investigate the possibility of a loan for the club. Between 2016 and 2019, the council explored the possibility of lending Everton the money for it’s new stadium, understood to be around £280m.
Joe Anderson, who was mayor at the time, proposed the plan as part of his “invest to earn” proposals and would have seen the council loan the money at a low interest rate to the club who would then repay it with interest, with any profits being spent on council services.
Everton Football club went on to reject the plans and secured funding elsewhere however the council had already spent money on the due diligence process and the report reveals that these costs may not be fully recovered.
The commissioners report notes that the the authority failed to manage costs when exploring the deal and some of those costs were now irrecoverable. The report confirms that the council did not secure a cost indemnity to protect its position on fees and had been in negotiations with the club for several years without any council approvals in place/
They have also ordered a “lessons learned” report.
At present the sums of money have not been disclosed due to “commercial sensitivity” but it is beliebed that the council will publish them once negotiations are concluded. Both sides have been involved in several rounds of discussions, with both sides keen to resolve the matter.
The report confirms that the council will need to write off any debt that arises from the difference between the invoice raised by the council and the settlement amount reached.