Council to lend £1.53million to a third party to develop Cherwell Village Extra Care apartments

Wednesday’s council meeting (13 December) approved the decision to loan £1.53m to fund the development of the Cherwell Village Extra Care apartments in Heywood.

Asked the name of the thrid party, Sally McIvor, the council’s director of adult services, said: “Due to commercial sensitivities, regarding ongoing contract negotiations, we are not in a position to name the provider at this stage. We will be announcing the names of all the providers in the near future.”

The Cabinet previously agreed to provide the loan (plus any resulting interest) to a third-party service provider through prudential borrowing. Prudential borrowing is the set of rules governing local authority borrowing in the UK. Under prudential borrowing, the amount of debt and other liabilities most local authorities can incur is no longer capped by an upper limit.

As the prudential borrowing requirement represents a change to the Council’s approved Capital Programme for 2017/2018, the approval of the Council was required.

All borrowing costs (estimated at £83k pa) will be recovered in full from the provider.

The proposal is expected to provide Rochdale Borough Council with an annual net of £102k via reduced social care support costs.