BCP's FuturePlaces spent £7.1m, £3.1m of it on consultants, and £2.4m was written off. Full Council votes on 20 new rules for council companies on Tuesday.
BCP Council’s regeneration company, FuturePlaces, spent £7.1 million in about two years. £2.4 million of it was never paid back and was written off when the council shut the company in 2023.
Those figures are in the final report of the council’s own investigation into the company. It goes to Full Council on Tuesday 13 October, where councillors will be asked to adopt 20 new rules for every company the council owns.
The report is written by Councillor Eleanor Connolly, who chairs the Audit and Governance Committee. It sits on the Council agenda for 13 October as Appendix 1, the Chair’s forward, alongside the internal audit investigation it summarises.
Where the money went
BCP FuturePlaces Ltd was an urban regeneration company created and owned by the council between 2021 and 2023. It was a central part of the plans of the administration led by Drew Mellor, which ran the council from October 2020 to May 2023. The new administration’s Cabinet agreed to close it in September 2023.
The report sets out the money plainly:
- the council agreed to lend the company up to £8 million as a working capital loan
- the company drew down £4.8 million of it, with no set date for paying it back
- the council paid the company £4.7 million for work, including £1.3 million before the loan existed
- the company’s total spending was £7.1 million
- £3,146,410 of that, 44%, went on consultancy work bought in from outside firms
- after the council decided which work to buy at closure, the company was left with a £2.4 million deficit, which was written off
The report says the money is not missing. “It is not the case that money loaned to or paid by BCP Council to Future Places is unaccounted for,” it says.
But it adds that the £2.4 million is not the full cost. It leaves out council staff time spent setting the company up and closing it. It also leaves out the fee paid to the consultancy Inner Circle, which advised on the set-up.
The committee asked why so much work went to consultants. If that much was going to be bought in, the report says, it “raised the question of why this should not be commissioned directly by BCP Council to avoid paying the high overheads”. Former FuturePlaces leaders told the committee the company needed more people for the number of projects it had been given, and was recruiting when it closed.
The plans it produced
The report gives two examples of the company’s work. Both were outline business cases approved by Cabinet in February 2023. Full Council then decided not to take either further.
| Site | Cost of the business case | Borrowing the plan needed |
|---|---|---|
| Poole Civic Centre | £250,000 | £43 million over 50 years |
| Christchurch Civic Centre | £169,000 | about £26.7 million |
The Poole plan was to turn the Civic Centre into a boutique hotel, with some housing. The committee “questioned whether this was ever realistic in the financial and economic climate”. When the council decided to sell the Christchurch Civic Centre in October 2023, it noted a £0.7 million a year viability gap in the FuturePlaces business case.
What the investigation found
The report covers how the company was set up, run and closed. Among the points it raises:
- Pay. The managing director’s package was £150,000 a year plus bonuses and benefits.
- Hiring. Four days after being appointed, the managing director named two people she wanted hired “asap”. The chief operating officer role was then advertised on the council website for one week, and the person already identified got the job.
- Bonuses. Staff bonuses never went to Full Council. The shareholder agreement listed 42 “reserved matters” needing approval by “the Council”, but did not say whether that meant Full Council, Cabinet or an officer.
- Offices. The company moved into Bourne House, Bournemouth, in 2022, under a licence signed with Hinton Road Investments Ltd. The report records that Drew Mellor became the sole director of that company on 5 May 2023, the day after the council elections, at which he did not stand. It says whether this should have been declared as an interest “is not for the A&G Committee to determine”. It also says the investigation did not look into the background to the deal.
The report records disagreement too. Former FuturePlaces leaders say the company was “unfairly maligned” before it closed and lacked support from council officers. Former non-executive directors told the committee they had no evidence of a negative campaign by officers.
The investigation cost about £38,250 in internal audit time, according to the committee’s covering report. That is 85 days at £450 a day.
The 20 rules councillors will vote on
The Audit and Governance Committee recommended the rules on 16 July. The council’s external auditor, Grant Thornton, expects them to be adopted. They would apply to every company BCP owns. The main ones:
- senior company directors must be openly advertised for at least three weeks
- councillors who sit as company directors cannot vote on council decisions affecting that company
- any bonus scheme must be agreed by the Shareholder Advisory Board and then by Full Council
- business plans, budgets and outturn for every council-owned company must be published
- full profit and loss accounts must be filed at Companies House
- council companies must be based in council-owned buildings; renting elsewhere needs Full Council approval
- the council’s action plan for its companies must include ending councillors’ roles as company directors
Also on Tuesday’s agenda
The same meeting decides several other things:
- SoBo Beach and WestBeach. Councillors are asked to approve new leases for the Southbourne Promenade site and the empty WestBeach restaurant. The operators and the rents are in confidential appendices. Our earlier story has the background.
- £11.2 million for IT from 2026 to 2032, for core systems and a rolling replacement of staff laptops.
- £2.3 million for building work to relocate services at the Civic Centre Annexe.
- Hicks Farm, Bournemouth. Approval to sell the farmhouse and farm buildings.
- SEND support. £1.5 million a year from the High Needs Block for earlier help in schools.
- Motions on the RNLI and on the Preston Model of community wealth building.
The meeting starts at 7pm on Tuesday 13 October in the Council Chamber at the BCP Civic Centre, Bournemouth BH2 6DY. The deadline for public statements was midday on Monday 12 October.
What it means for you
The £2.4 million write-off was council money. It sits alongside a much bigger problem: the council expects a £38.2 million gap in next year’s budget. Our council tax bands page shows what each band pays now.
The new rules matter because BCP still owns other companies. If adopted, their business plans and budgets would be published, and bonuses would need a vote of Full Council.
We will report what Full Council decides.
Have your say