Council boss receives £225,000 as housing firm closes

The boss of shuttered council-owned housing firm 3 Rivers Developments was paid more than £225,000 in pay, pension and compensation for loss of office in his final full year.

Questions about the redundancy payout for managing director Nick Sanderson and the broader pay of 3 Rivers' staff were raised at Mid Devon District Council's audit committee this week.

One resident, who asked for her questions to be read by Cllr Lloyd Knight (Liberal Democrat, Cullompton Padbrook), the new chair of the audit committee, queried why Mr Sanderson received compensation, given he had only run the housing firm since April 2021.

Mid Devon's draft accounts show that Mr Sanderson received a payment of £66,839 for loss of employment, on top of his salary of £83,364. Adding in his £76,425 of pension contributions, his total remuneration for the 2023/24 financial year was £226,628.

However, Cllr James Buczkowski (Liberal Democrat, Cullompton St Andrews), cabinet member for finance, said Mr Sanderson's redundancy payout also covered his previous service at the council, including a former role as head of housing and property.

Cllr Buczkowski confirmed that less than £10,000 was spent on redundancy payments for three other employees of 3 Rivers.

Mid Devon's Liberal Democrat-controlled council has overseen the closure of 3 Rivers, with a formal application to strike the firm off the Companies House register set to be submitted imminently.

While this marks an end to the company's existence, some residents are still keen to unpick certain decisions that the council made throughout the life of the now defunct housing firm.

One line of enquiry for some residents relates to the decision by Mid Devon to buy land at Knowle Lane, Cullompton, for £3.6 million when it has now revalued it at £1.6 million.

The council's scrutiny committee undertook a 'lessons learned' exercise at the end of last year, after which it produced a report outlining certain steps the authority would take if it ever launched a company again.

Leader Luke Taylor (Liberal Democrat, Bradninch) has, however, said he won't be creating any more council-owned companies while he is in charge.

Mid Devon District Council issued the following when approached by Devon Live: "The Council has a redundancy policy, as do all public sector organisations, and this policy has been followed. We do not comment on an individual’s remuneration but information is available for the public through our published accounts, open committee meetings and minutes published online.

"Regarding the soft-closure of 3 Rivers, we acknowledge any financial losses are hugely disappointing and cause an impact, but it has been our job to minimise that impact and get the best return possible. While the cost of the 3 Rivers closure to the Council has been significant, the financial losses, which ended at circa £3.4 million, are not on the scale previously quoted in the local press and social media, and the firm’s assets have now been repurposed for the benefit of local people. "