Thurrock crisis: this is a bizarre twist to the solar farm scandal
Suing other councils is not the answer to Thurrock’s financial woes
Lost among the gaudy details – diamond-encrusted watches, a rotating bed and a 25-screen TV – is the fact that Thurrock council would not be in the hole it is today without being handed the shovel by other local authorities.
Thurrock’s reckless investment spree, and the life of luxury it enabled Liam Kavanagh to live, was funded by the £1bn it borrowed from more than 150 councils across the UK. The short-term loans – many only a month in length – left Thurrock stuck in a loop of borrowing from Peter to repay Paul, neither of whom asked what their money was being used for.
It was only when local authorities were urged to stop lending to Thurrock, after my exposé in July 2022, that this house of cards collapsed and the council went bust.
As such, there’s an irony in Thurrock turning once again to other councils for money – only this time far less amicably.
Thurrock is desperately trying to recover the hundreds of millions of pounds it lost through a series of secretive investments, including in Kavanagh’s solar farms. In March it sued Kavanagh. Now it is threatening to do the same to 23 local authorities.
The situation is bizarre. Since September last year Thurrock has been pursuing legal action against the Association for Public Service Excellence (APSE), the organisation that valued 32 of the solar farms.
The council says APSE’s process was “negligent” and overvalued the sites, causing it significant financial loss. APSE argues its work was based on figures provided by Kavanagh’s company Rockfire Capital. As I reported last year, there’s strong reason to believe those figures were deliberately inflated.
The twist is that APSE’s business model means liability falls on its members, more than 250 of whom are local authorities. Instead of going after all of them, Thurrock has targeted a sample of 23.
Coincidentally, some of those councils, such as Derby, Isle of Wight and Eastleigh, were among those that loaned cash for Thurrock’s investment kitty. Another, Warrington, introduced Thurrock to Kavanagh.
Thurrock argues that taking action against these councils is a last resort – something to keep in its back pocket should the case against Kavanagh fail. It wants the chosen councils to agree to an indefinite extension on its deadline to sue, potentially so it can delay any action to after the Kavanagh case is resolved. This will be scant comfort to the 23 being pressured to agree to a sword of Damocles hanging over their heads for years to come.
Let me be clear: I want Thurrock to get as much of its money back as possible. Throughout what is now a five-year investigation I have spoken to many residents affected by the scandal, who face higher taxes and poorer local services because of failed investments they were told next to nothing about. I also understand the pressure the new Labour administration is under to balance the books.
But going after other councils is not the answer. What knowledge could they have possibly had about the valuation of these solar farms? How can shifting the financial burden to other local authorities, and more importantly the people living in those areas, be justified?
Senior Thurrock council officers and Conservative cabinet members spent years with their heads in the sand, dismissing every concern raised about the investment strategy. Those strategy failures stretch far beyond these solar farms. Valuable time that should have been spent challenging Kavanagh and others was wasted. Should the case against him ultimately fail, the responsibility will lie with Thurrock.
It should not be down to 23 councils, and possibly hundreds more, to pick up the bill. Local government should not, as one senior figure put it to me this week, be “turning on itself”.
Lead photography by Alex Sturrock for TBIJ. Design by Katia Pirnak.
Reporter: Gareth Davies
Deputy editor: Chrissie Giles
Editor: Franz Wild
Production editor: Frankie Goodway
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