Kent County Council 'confident' of recouping £45m Iceland cash
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by
political editor Paul Francis
County council finance chiefs say they remain confident
KCC will recoup the £45million the
authority still has tied up in Icelandic banks.
It follows a setback last year when administrators of one of the
banks, Glitnir, ruled that councils would no longer be considered
as preferential creditors.
A court is due to rule shortly on that decision after local
authorities mounted a legal challenge. Lawyers representing
councils have lodged a formal bjection, arguing the move was out of
step with the position of administrators for one of the other
banks, Landsbanki.
Cllr John Simmonds (Con), KCC cabinet member for finance, said
the council had always acknowledged the recovery of the money would
be a long process.
“We have never pretended that the money would come back
overnight or that it would not be a long process. We have got back
£5million and for the remainder, the signs look good and the court
case is coming up very shortly which should re-establish our rights
as preferential creditors.
It is a sign of our strength in financial management [as an
authority] that we have managed to carry on without impinging on
frontline services,” he said.
KCC has about £15million on deposit with Glitnir and has
previously forecast it will recover all the money. However, the
administrator's move placed a question mark over the process of
recovery and if KCC lost its priority status, losses could be
substantial.
Read Paul's blog on this and other
political stories here>>>
Canterbury City
Council, which has £2million deposited with Glitnir, has said
that it does not expect to get any further money back until next
summer at the earliest.
A spokesman for the Local Government
Association, which is co-ordinating the legal action by local
councils, said no firm date had yet been set for the court
hearing.
Monday, February 22 2010
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