Loans plan for council-owned Blackpool attractions hit by Covid

The landmarks are part of companies owned by the council facing losses of up to £20m after trade was badly hit by lockdown and Covid restrictions.

Now town hall finance chiefs are proposing to create a £24m recovery fund using cash from the council’s £200m business loans fund.

Five of the council’s eight wholly owned companies – Blackpool Transport, Blackpool Airport, Blackpool Entertainment Company (which manages the Winter Gardens), Blackpool Operating Company (which manages the Sandcastle), and Lancashire Management Operations (which oversees council owned student accommodation) – are in need of the cash.

The three other companies – Blackpool Housing Company, Blackpool Coastal Housing and Blackpool Waste Services – are so far not affected enough to need financial help.

The Covid Recovery Fund will comprise of up to £20m plus a 20 per cent contingency of £4m.

A report setting out the recommendation to form the fund says coronavirus “has led to a number of council wholly owned companies facing significant income losses as a result of lockdown and subsequent social distancing restrictions.

“This is impacting both company profitability and cashflow. Without council support it is likely that some would not be able to recover within a reasonable timeframe.

“In some situations this could leave the council without an operator for assets of significant financial value and importance to the town and its tourist economy.”

It is estimated the companies will need at least £14m to help them survive, with a worst case scenario of £20m, depending on the length of Covid restrictions, the amount of further Government grant support made available and the timeframe for business recovery.

The loans will be paid back over five years and monitored by council officers.

Coun Tony Williams, leader of the opposition Conservative group on the council, said the move would “protect a large number of jobs during this critical time.”

But he warned the council, which set up the business loans fund to support private investors in the town, was receiving substantial government financial support and must be equally fair to all businesses needing help.

He said: “I think that there will be lots of struggling private business owners who might be annoyed at how easy it is for the council to borrow money from this fund, when they are facing serious financial hardship.”

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