Labour Council Gives £10 million ‘helping hand’ to Travelodge

You know how it is: you’ve got a few bob lying around in bank accounts earning a measly 0.5% interest. If only it could be put to better use and earn a decent rate of return. Suddenly you have a light-bulb moment – so beloved by New Labour – give a helping hand to big business!

Sir Peter Soulsby Leicester’s Lord Mayor has persuaded his ‘fiefdom’ – the overwhelmingly Labour city council – to agree a £10 million leasehold arrangement with Travelodge to create a 67 room hotel above the Haymarket shopping centre.  In a debate prompted by some Labour councillors’ discontent Sir Peter’s rebuff relished in the lucrative detail of his proposal: the council’s rate of return would be £9.7 million over 25 years and potentially £27.7 million over 50 years. Ah, the Blairite dream of long-term capitalist enterprise! Ross Wilmott pointed out “Travelodge could disappear in 25 years and still owe £2 million”.

Sir Peter knows a lot about long term loan arrangements. As a ‘commoner’ MP he supported the New Labour government’s PFI schemes which lumbered schools, hospitals, with long term debt. But as a pro-business Labour City Mayor his leasehold agreement with Travelodge is far more favourable to the loanee. At the same time he boasted it would benefit the city’s regeneration, its economy and “bring jobs to the city”. As always the devil is in the undisclosed detail. The Haymarket shopping centre is at one end of the High Street and at the other end … there’s another similar-sized Travelodge hotel, built during New Labour’s crusade for ‘super casinos’ it sits next to a casino … counting its future losses to the ‘new kid on the block’?

So this sorry tale of a cash-strapped Labour council with ‘rainy day’ bank balances earning 0.5 interest that Sir Peter decided could not be used to support a No Cuts budget or for housing – Ross Wilmott said £10 million could pay for 250 new council homes – has become a travesty yielding a 4.1 % return.

After her failure to win the Labour Party leadership in 2015 local MP Liz Kendall was renamed Liz 5% Kendall. Likewise Sir Peter should be renamed Pete 4.1% Soulsby in next year’s Lord Mayor election.