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16 April 2018, 17:12 | Updated: 16 April 2018, 17:15
Financially troubled Northamptonshire County Council, advised by PwC, have accepted a sale and leaseback of its One Angel Square headquarters to Canada Life Investments for £64m.
The authority, which is facing £40m budget cuts has agreed to the sale and leaseback of the £53m building.
It's thought the £11m surplus will help the struggling authority meet its requirements to local people although no word currently if the planned reduction in libraries and library services will go ahead.
Cllr Matthew Golby, Leader of Northamptonshire County Council said:
"We believe that this transaction is effective in leveraging the council’s assets and covenant allowing us to maximise the benefit of very competitive pricing at this point in the market.
I am confident that the transaction will provide the funding required to enable the transformation programme to set the council on a strong future trajectory.
The advice received is that this deal represents very good value for money for taxpayers of the county and generates more money than the construction costs of the building.
While this kind of deal may be less usual in the public sector the lease back arrangements being entered would be seen as standard finance practice in the private sector.
Put bluntly without this sale far more service cuts would be required and the process of reorganising local governance in the county would be carried out against a backdrop of unsustainable cuts to the very services the new councils would be created to run.”
The lease-back agreement with Canada Life will be over 35 years.