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| Cash-strapped Northamptonshire council lent law firm £1m | Cash-strapped Northamptonshire council lent law firm £1m |
| (about 11 hours later) | |
| A council labelled the worst-run in the country and facing "severe financial challenges" lent a law firm nearly £1m, it has emerged. | A council labelled the worst-run in the country and facing "severe financial challenges" lent a law firm nearly £1m, it has emerged. |
| Northamptonshire County Council was twice forced to stop all non-essential spending in 2018. | Northamptonshire County Council was twice forced to stop all non-essential spending in 2018. |
| But the BBC has learned the council continues to offer a £1m overdraft facility to a company called LGSS Law. | But the BBC has learned the council continues to offer a £1m overdraft facility to a company called LGSS Law. |
| The credit was offered to "ensure the emerging company avoided any cash flow difficulty", the council said. | The credit was offered to "ensure the emerging company avoided any cash flow difficulty", the council said. |
| LGSS Law - which is owned by Cambridgeshire County Council, Northamptonshire County Council and Central Bedfordshire Council - was founded in 2015 with the aim of providing a "new model" for public sector legal services. | LGSS Law - which is owned by Cambridgeshire County Council, Northamptonshire County Council and Central Bedfordshire Council - was founded in 2015 with the aim of providing a "new model" for public sector legal services. |
| 'Money back' | 'Money back' |
| It now has more than 100 public sector and not-for-profit clients, including Ipswich Borough Council and Corby Borough Council, and employs more than 150 people. | It now has more than 100 public sector and not-for-profit clients, including Ipswich Borough Council and Corby Borough Council, and employs more than 150 people. |
| Filings with Companies House reveal LGSS Law, which had an £8.7m turnover in 2018, drew down £950,000 of the Conservative-led council's £1m overdraft in 2017-18. | Filings with Companies House reveal LGSS Law, which had an £8.7m turnover in 2018, drew down £950,000 of the Conservative-led council's £1m overdraft in 2017-18. |
| Labour councillor Mick Scrimshaw, who is also the county council's overview and scrutiny committee chairman, said: "There are definitely questions that need to be asked. | Labour councillor Mick Scrimshaw, who is also the county council's overview and scrutiny committee chairman, said: "There are definitely questions that need to be asked. |
| "There is no question that the council could do with that money back. It would go some way to dealing with the overspend." | "There is no question that the council could do with that money back. It would go some way to dealing with the overspend." |
| Northamptonshire County Council's financial crisis timeline | Northamptonshire County Council's financial crisis timeline |
| A council spokesman said the overdraft was provided when the company was established. | A council spokesman said the overdraft was provided when the company was established. |
| "This was before the council's recent financial difficulties," he said. | "This was before the council's recent financial difficulties," he said. |
| "The purpose of the overdraft was to provide a working capital to ensure the emerging company avoided any cash flow difficulty. | "The purpose of the overdraft was to provide a working capital to ensure the emerging company avoided any cash flow difficulty. |
| "This facility is still required by the company at this present time." | "This facility is still required by the company at this present time." |
| LGSS Law did not respond to questions about the overdraft from the BBC. | LGSS Law did not respond to questions about the overdraft from the BBC. |
| The county council was called "the worst run in the country" by Kettering MP Philip Hollobone. |