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28
Jan 2022
Council predicts loss-making Brierley Group will return to profit
North Yorkshire County Council is predicting its trading arm will bounce back into profit this year after reporting significant losses.
The county council’s leadership has said while the overall profits of The Brierley Group remain lower than anticipated, the in-kind “shareholder value” of the companies to the public purse in the year to April, through savings, would be almost £6 million.
A meeting of the shareholder committee of the council, which has embraced a “culture of commercialism” to help protect frontline services, heard The Brierley Group was forecast to recorded turn last year’s £639,000 loss into a £268,000 profit for the 12 months to April.
Officers told the meeting the three months to September last year had seen “lots of ups and downs” so across the group after tax there had been a loss of £330,000 for the quarter, against a budgeted loss of £1,000.
They said the main reasons for the loss was the impact of covid-19 and struggles to retain staff.
Officers said while its educational services firm had been hit by unpredictable uptake of school meals, making it impossible to achieve the necessary economies of scale, he firm was looking at innovative ways of working “to build on that commercial success as we move into a post-covid world”.
The meeting heard roadworks company NY Highways, which launched in June last year, was set to generate a small profit, and its property services firm Align profits were expected to exceed budget and be ahead of pre-covid trading, while internet service firm NYNet had also seen a strong performance.
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However, councillors were told as its property developer firm Brierley Homes had three sites under construction at Pateley Bridge, Millwright Park and Marton cum Grafton, the group’s overall figures were being skewed by the length of time it would take to generate profits.
The meeting heard there had been challenges over getting labour and materials, which had hit the schedules, but the sites would start generating profits in the coming year.
'A step in the right direction'
Officers said Brierley Homes were creating a business plan which would ensure a steady stream of sites and houses into the future to ensure it was regularly profitable.
Cllr Don Mackenzie, executive member for access, said:
Councillors heard the £5.9 million of “shareholder value” was equivalent to just short of a 2% increase in the authority’s council tax demand alongside improvements in services.
The meeting was told complaints over road maintenance had dropped since the launch if NY Highways, which was also more responsive to specific issues than previous contractors.
The council’s deputy leader, Cllr Gareth Dadd, said local authorities up and down the country were looking at The Brierley Group “with envy”.
He said:
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