CHRISTCHURCH MP Sir Christopher Chope said the Government should strengthen its powers to clamp down on councils who do not follow guidance around flexible uses of capital receipts.

Sir Christopher said his attention had been drawn to the subject over concerns with BCP Council’s plans to sell thousands of beach huts.

The local authority wants to set up a wholly or majority owned company to buy the huts, with this transaction – in the region of £54million – helping to plug a financial gap in the council’s transformation programme.

BCP Council wants to use the money from the special purchase vehicle plan under the Government’s flexible use of capital receipts, which would allow the money to be spent on projects as long as they generate ongoing savings or transform services that would make savings once complete.

Sir Christopher told the Daily Echo he thinks the council believes it has the ear of government but in his opinion the beach hut plan is “totally inconsistent” with the Government’s aims and objectives for flexible use.

“What is good from my point of view is this is being looked at and the government is not going to sleepwalk into allowing this to happen, it is alert to what is happening and if the government decides to give it the green light we will have to wait and see,” Sir Christopher said.

The backbench Conservative MP said current guidance does not give the Government power to veto a council plan, however he said he thinks this should change.

Bournemouth Echo: Christchurch MP Sir Christopher ChopeChristchurch MP Sir Christopher Chope

Asked if he thought the Government needed to ramp up its ability to act, he said: “I do because that is too easy for councils to get into sales and lease backs and selling off their assets and basically increasing their borrowing and making themselves more vulnerable to shocks in the marketplace.

“We know Bournemouth council, as it was, with its venture into trying to buy up a shopping centre has turned out to be a really bad deal although everyone thought it was going to be great at the time.”

He added: “What we are talking about is local tax payers’ money and local tax payers don’t expect their money to be put at risk and the job of the government is to prevent local tax payer money being put at risk by reckless councils.”

The flexible use guidance says councils must submit details of its planned flexible use of capital receipts for each year to the Secretary of State.

A BCP Council spokesperson said: “The council has followed the appropriate guidance and produced a flexible use of capital receipts strategy to full council in the 2022/23 council budget report. It also submitted details to the Secretary of State after the 2022/23 budget meeting.”

A report on the beach hut special purchase vehicle is set to go before the corporate and community overview and scrutiny committee on July 20, cabinet on July 27 and full council for an overall decision in September.

Local government minister Kemi Badenoch said: "It is for local authorities to make sure that they apply the flexibility correctly and have regard to the guidance on flexible use of capital receipts.

"The guidance is clear that the flexibility is to allow authorities to use the proceeds from the sale of assets to fund transformation and release savings. Authorities must appropriately comply with the rules and guidance, and adherence should be subject to internal scrutiny and review by auditors

"The Government is now carefully considering whether amendments are needed to the direction and guidance to make sure the freedoms are used in the spirit and intent with which they are provided."