BOLTON Council is not getting a good return on its investments, according to leading Conservative councillors.

It is estimated to receive £900,000 in interest on its total investments of £158m, councillors were told.

The council invests its money by lending cash to banks as well as other local authorities.

The figures were revealed at an audit committee meeting on Wednesday when Cllr Martyn Cox asked why the return on investment was so low.

Conservative group leader David Greenhalgh, who chairs the council’s audit committee, also raised his concerns.

He said: "I think most people in this town will think it unbelievable that in one year Bolton Council are investing £158million, and only receiving £900,000 in interest, just over 0.5 per cent.

"Clearly this is Bolton taxpayers money, and a scheme has to be adopted that gives minimal risk, but this return is pitiful, and at a time when savings are having to be made, we should be investigating safe ways to get a much better return on our investments, which will provide a very welcome revenue stream that can protect jobs and valued front line services."

Bolton Council had £158 million in cash investments on September 30.

Since the meeting, the council told The Bolton News its actual anticipated income for 2018/19 is £1.346m, which would boost the total interest rate up to 0.85 per cent.

Last year, the council’s cash was invested in several banks such as Barclays, Lloyds and Santander – with investments of £10 million or more.

It also loaned money to local authorities across the country such as Lancashire County Council, Dundee City Council and Blackpool Council – each receiving £5 million.

Labour councillor Bilkis Ismail asked auditing officers at the meeting why money was not being invested in other big banks with better interest rates.

Borough treasurer Sue Johnson explained that many banks already have high levels of cash reserves, because of new requirements set by the government following the financial crisis in 2008, and therefore do not want the council’s money.

Speaking after the meeting, Cllr Sue Haworth said she was satisfied with this response.

She said: “I felt quite assured that the borough treasurer made it clear to us that what’s not on the paperwork is that every time she looks to change our investment, she goes first on the phones to the financial organisations that pay the greatest interest rates.

“She explained to us that she can’t get a deal. They themselves hold a good amount of cash reserves.”

The Harper Green councillor asked the auditing team to look at figures coming out of other councils, particularly city councils, for comparison.

In November, Manchester City Council reported an average net return of 0.49 per cent on its temporary investments of £159.8m.

Meanwhile, Bury Council reported a much smaller investment portfolio at £4.8m, down from £18.5m earlier in the year, but made a return of 0.61 per cent in the first six months of 2018/19.

The committee requested a more detailed report with options of investment and asked for “benchmarking” from other local authorities.