The Lib Dems on the County Council have made the following points about the “Bank of Essex”, which is now being scrapped:
1) When the first phase was launched in December 2009 the stated ambition for Banking On Essex was to create a local municipal bank.
2) The County Council put aside ?50m from it?s cash balances to support the scheme.
3) It cost ?380,000 to establish the scheme but the money could never be recovered.
4)Lib Dem County Councillor David Kendall asked for the scheme to be reviewed by the Economic Scrutiny Committee and this took place in June 2010.
5) By May 2010 only twelve loans had been approved with a value of ?320,000
6) No figures were ever made available on the number of applications turned down.
7) Following the scrutiny in June members were told they were going to get regular updates on how the scheme was going but it never happened.
8 ) The Leader Cllr Peter Martin was due to be questioned about the Banking on Essex scheme at the Economic Development & Environment Policy & Scrutiny Committee this Thursday (24/2/11) by Cllr Kendall and other members of that Committee.
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Speaking about the decision Cllr Kendall said :
?I believe the County Council has made the right decision to scrap Banking on Essex. I had serious concerns about ?50m of Essex residents money being set aside to support Banking on Essex. I was also very concerned that it cost ?380,000 to establish the scheme back in 2009. Since then the number of loans granted has been quite small and only half a million pounds has been lent to local businesses. I was also concerned that no figures were ever made available as to the number of applications turned down and members were not given updates on how the scheme was performing. There were also instances of businesses applying for loans experiencing problems with paperwork being lost. I have never been convinced that it was right for the County Council to get directly involved in Banking and it seems the Tories running Essex County Council have now finally come to the same conclusion?.