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Council could set up a private company to generate income

Created on 10/02/2019 @ 10:51
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Powys County Council could set up its own commercial company to trade with private and public sector organisations, creating additional income.

It could mean businesses and organisations in Newtown being offered additional services on a commercial basis by the council.

A report is going before the council’s Cabinet on Tuesday when they will make a decision.

"There is the potential for the council to generate additional income by trading its services to the public and private sectors," states the report by  Cllr Aled Davies, Deputy Leader and Portfolio Holder for Finance, Countryside and Transport.

"The Local Authority Goods and Service Act 1970 enables the council to trade with other public bodies as well as private sector organisations to generate a profit, however, to do so the council would need to establish a Local Authority Trading Company (LATC).

"The LATC model is the most common vehicle used by councils to trade whilst retaining ownership."

The move would provide the council with additional income at a time to cuts and savings and a 9.5% increase in Council Tax.

The report adds: "Part of embracing the council’s vision of ‘Open and Enterprising’ encompasses the need for commercial opportunities for greater income generation as well as a significant drive to reduce council expenditure."

Councillors are to be given two options. One is to trade as Powys County Council to mainly other public organisations, or a second option to set up the LATC, allowing it to trade with the private and public sector.

"The LATC would be wholly owned by the council as a sole shareholder and would be a company limited by shares incorporated under the Companies Act 2006. This form of company has been used successfully by a number of councils."

Councillors will make a decision on Tuesday.

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