Newcastle City Council gets into property speculation

Newcastle City Council, after just announcing nearly 700 jobs cuts, has obviously decided that the solution to their financial difficulties is... property speculation!

The Council has just bought a six-storey building in the city centre for £5 million, claiming it will make a profit by renting out office space.

The last time I looked, commercial property agents in Newcastle (ie people who are actually experts on commercial property) had acres of empty office space on their books which they’re struggling to give away. And perhaps the council has forgotten one of the main reasons for our current financial predicament – rampant property speculation and an unsustainable property bubble?

More than 650 jobs have been axed at the authority as Council bosses get to grips with £45 million of cuts,  and council staff have been hit with a two-year Government-imposed pay freeze. However, this hasn’t stopped the caring and sensitive Newcastle City Council awarding their Chief Executive Barry Rowland a “performance-related” pay rise of almost £5,000 extra, on top of his existing £160,500 a year salary.

If, as seems highly possible, the council does not manage to buck the local
commercial property trend and it makes a loss on this venture, maybe Mr
Rowland might take a "performance-related" pay cut?"

Colin Cameron, North East TPA

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