Another Confidential Deal: Council Plans Loan to Children's Charity With No Public Input...

Behind closed doors, Hartlepool Borough Council prepares to loan public funds to a charity – but refuses to tell local residents how much.

16th June 2025

A supposedly 'cash strapped' council is once again reaching into its back pocket – but this time, it’s not to fund another derelict building purchase or bail out a mismanaged scheme. This time, it’s looking to loan public money to a charitable organisation to set up a new children’s home in the town.

At a Finance & Corporate Affairs Committee (Formally Finance & Policy) set to he held next week, councillors will be asked to approve, in principle, a loan facility to the local charity 'Changing Futures North East' – a charity operating in Hartlepool – to help open a new residential children’s home in the Borough.

According to the documents set to go before councillors next week, CFNE apparently has “most” of the funding already secured, but they’ve now come cap in hand to Hartlepool Borough Council to bridge a funding gap. And the council, eager to say it's doing something about spiralling private placement costs in children's social care, seems only too happy to oblige.

However, controversially, its claimed that whilst the deal would potentially benefit the local council local tax payers are likely to be footing the bill. Where, once again its claimed key financial details – including how much the councils set to lend the charity – is being kept secret in a confidential appendix.

Hartlepool Borough Council's been under pressure over the ever rising costs of children’s social care, particularly the fees being paid to private providers. They claim that council-run homes are cheaper – and they’re not wrong. But after only managing to open one new home so far (which will only offer three places), the council's reportedly 'struggled to find further suitable properties'.

So now they’re looking to a third party to help fill the gap – CFNE. On paper, it could potentially add four more places, reducing reliance on profit-driven private homes. But there’s a difference between supporting a charity and becoming its banker – especially when the financial risks are brushed under the rug in a confidentiality clause.

The proposal is to loan the money to CFNE, with the promise that the council gets first refusal on placements and that interest and repayments will be made in full. A Memorandum of Understanding will apparently back this up – but that’s not the same as a legally binding contract.

Critics are also likely to question the councils ambitions especially if CFNE can’t make repayments or the project fails?

The council claims due diligence will be carried out and risks “mitigated,” but that’s little comfort given Hartlepool Borough Councils previous track record of poor financial oversight – whether it’s wasting money on Church Street property schemes or Vanity Projects that cost locals hundreds of thousands of pounds a year, only to be then demolished to make way for housing.

Hartlepool Borough Council has already approved £1 million pounds in borrowing to develop children’s homes – yet its claimed only one property has materialised so far. Now, instead of following through on that plan, they're proposing to lend money to a third party organisation.

Until the full financial details are released, and the public are properly consulted, this proposal looks less like “helping vulnerable children” and more like another backroom deal that shifts all the risk onto local taxpayers, whilst the real winners remain hidden behind charity logos and council confidentiality.

Just like it was in the old days !

And we all know how that ended !