Regeneration firm owned by Barking and Dagenham Council loses almost £4million in its first year
PUBLISHED: 14:10 11 April 2019 | UPDATED: 17:37 11 April 2019
The council owned regeneration firm Be First Regeneration Ltd lost close to £4million in its first year.
The business involved in building projects across Barking and Dagenham lost £3,931,134 before tax according to its accounts up to March 2018 filed on April 5 with Companies House.
The GMB union, which has members at the council, has urged the local authority to hike up targets for Be First backed social homes and called on councillors to come out against the business.
Warren Kenny, GMB regional secretary said: “These accounts, filed more than four and a half months late, underline why councillors should call in Be First’s plan to reassess what the company’s aim should be.”
The union said plans for only 1,600 homes out of the 9,700 to be built by 2023 to be affordable was ‘grossly inadequate’. “The majority of new homes to be built should be genuinely affordable, social housing,” Mr Kenny said.
He added the loss underlined the urgency of acting in a borough where many people would never be able to buy the homes Be First had in the pipeline.
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The firm, set up in October 2017, is involved in a number of projects including at Crown House and the Gascoigne Estate in Barking.
The £4m is made up of a £891,134 loss and £3,040,000 worth of pension liabilities taken on when council staff transferred to Be First.
The company’s strategic report says the loss falls within budget limits agreed with the council which will pay its debts and not demand repayment until 2021.
“Barking and Dagenham has confirmed it will continue to provide support as needed to the company for the foreseeable future”, it adds.
A spokesman for Barking and Dagenham Council and Be First said: “The council anticipated a loss in the first year of trading and recognised there will be peaks and troughs in cash flow as the company gets established.
“Be First is on course to make a profit this year and meet the council’s targets.”
The council’s expected income would not be affected because repayment of the pensions liability was already accounted for by the company, he added.
The company was late meeting its deadline because of delays in the external auditing process which took longer than normal, the spokesman said.
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