Case of missing £1.1m SEMLEP funding in Luton to be discussed by council's scrutiny finance group

The case of £1.1m regeneration funding that disappeared in the coffers of Luton Borough Council is set to be discussed at a future meeting, it has been revealed.

Wednesday, 20th January 2021, 5:28 pm
Updated Friday, 22nd January 2021, 1:26 pm
Luton Town Hall

A police investigation was launched in June last year after £1.1m funding destined for the redevelopment of Mark Rutherford School in Bedford mysteriously vanished.

The money had been set aside by SEMLEP (South East Midlands Local Enterprise Partnership), which issues government grants for local projects. Luton Borough Council acted as a banker for SEMLEP at the time - receiving the government funding before passing it on it to the designated projects.

Mark Rutherford School was due to receive its funding by March 2020, but it is understood the money had already disappeared. In April last year, Luton Borough Council discovered the money for the school had been misappropriated and paid to "persons unknown" - leading them to contact police.

Bedfordshire Police has stated that the investigation is being handled by NATIS - the National Investigation Service.

On Monday, it was revealed the issue is going to be put on a future agenda for LBC's scrutiny finance review group, following a request by Liberal Democrat Cllr Diane Moles.

Cllr David Franks, leader of the Liberal Democrat opposition group on the council, said: "Cllr Moles has been concerned with the lack of information on the loss for some time. There have been no statements from the council or SEMLEP since the original announcement ages ago.

"We discussed the matter and agreed the best way forward would be for a full report to the council’s scrutiny finance review group."

At this stage, it is unknown whether the missing £1.1m funding will be discussed in open session or privately.

Cllr Franks added: "Liberal Democrats always have a starting position that information and discussion should be in public, especially where it involves custody of public, taxpayers’ money.

"However, we are prepared to agree to private reports when we can be convinced it is necessary and is not just being proposed to save embarrassment.

"In the case of the missing SEMLEP £1.1m, no-one from the council has approached me to discuss whether the report should be in public, if and when they do we will listen to what they have to say and decide what our response will be.

"£1.1m of public money went missing, so if they do decide they want it to be debated in secret, they had better have a very good reason.”

A Luton Borough Council spokesman added: "Last year, we reported to the police that we believed there had been a highly sophisticated external criminal operation involving the funds of an external organisation.

"While reports and comments we've seen on this matter appear to suggest otherwise, we can confirm that this was not Luton Council money and we have no reason to believe that it was the council's systems that were compromised.

"We can't comment further on this matter as it is still being investigated by the National Investigation Service. We will be able to provide more details once the investigation has concluded, which will include a full update to the council's finance scrutiny committee."