Merton Council has reported a £186m capital injection in its annual accounts following the sale earlier this year of a professional services company it created.
CHAS 2013 Ltd, an international firm which supports the construction sector with safety accreditation, was a wholly-owned subsidiary of the authority and was sold to a US-based firm in January.
The council said it would use £50m of the money to pay off half of its debt, mainly in paying off government loans. By doing this, more money will be freed up to spend on maintaining and improving local services for residents, the authority said.
In addition, Merton Council said a “significant sum” would be invested into government-backed investment schemes – “ensuring low-risk investment for residents that will generate another annual income stream”.
Around £75m will be earmarked to be used for longer-term projects in the borough. The authority described such projects as “including building the first council homes in a generation, breathing new life into our town centres, and deliver new sporting and leisure facilities as part of our ambition to become London’s first borough of sport”.
As a capital receipt, the money cannot be used for the annual cost of providing services, and can instead only be used for one-off investments, and capital projects such as building new infrastructure in the borough.
Council leader Ross Garrod said: “This capital injection is great news for residents – putting the council in a strong position to deliver on our ambitions to build a better Merton, together.
“With government funding cuts now an annual event, it is more important than ever that we spend this money wisely – especially as it can only be spent once.
“That’s why we are prioritising paying down debt and making sound investments which will help us save money and generate income to reduce the impact of cuts from Westminster to council services.”
New s151 officer at Merton
In separate news, Asad Mushtaq has been appointed as executive director of finance & digital (CFO/s151) at the London Borough of Merton.
He previously served at St Helens Council for almost three years as director of finance (CFO/s151) between March and May 2023 and as director of finance (deputy s151) between September 2020 and March 2023.
Mushtaq’s previous roles include head of finance & property (CFO/s151) at Burnley Borough Council and finance manager at Westminster City Council. He has also spent time at Oldham and Reigate & Banstead Borough councils throughout his career.
Mushtaq graduated with an MBA from Alliance Manchester Business School.
Mushtaq told Room151: “I’m really looking forward to returning to London and joining an ambitious but community focused organisation, and in particular driving forward its affordable housing agenda.”
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