Officials have insisted that Ipswich Borough Assets - the business set up to help boost council income - is still good value despite reporting a £6.3m loss last year.

The company was set up by the borough council nearly a decade ago to buy commercial property to provide an income stream to reduce its reliance on council tax payers.

It bought properties including the Anglia Retail Park, Beardmore Park at Martlesham, and a business park on the edge of Peterborough using money borrowed at a low interest rate from the Public Works Loans Board.

The profit on the rent paid by the tenants of these properties was then paid to the council - a move that was guaranteed to raise £3.2m a year for the borough.

However, last year IBA reported a loss of £6.3m - although the annual payment to the borough council continued.

Ipswich Star: Colin Kreidewolf said IBA would continue to support the council.Colin Kreidewolf said IBA would continue to support the council. (Image: Charlotte Bond)

IBA chairman, and Labour councillor, Colin Kreidewolf said the figure was largely a paper loss caused by a revaluation of its assets.

He said: "We have to have all our properties revalued for the accounts - and the value of the retail parks and the business park at Peterborough have been downgraded.

"We haven't lost tenants at the retail parks and they are still bringing in a steady income which is going to the council - but we have to record a lower value.

"That would only be relevant if we were trying to sell them - which we aren't."

Ipswich Star: Ipswich Borough Assets has bought the Peterborough Business Park. Picture: IPSWICH BOROUGH ASSETS

There is also an £800k operating loss in the the annual figures.

Mr Kreidewolf said that arose because IBA continued to meet its financial obligations to pay £3.2m a year to the council even though some of its assets were unoccupied and it needed to fund resurfacing work at the Anglia Retail Park.

He said: "One of our major buildings, Portman House, was empty for most of that time - but it now has new tenants which will bring our income up.

"We have done Anglia Retail Park so that isn't costing us as much - although we are still looking for tenants for some of our offices at Peterborough."

Conservative opposition leader Ian Fisher was concerned about the revaluation of the assets, particularly the Peterborough business park.

He said: "We had a briefing about this and I asked if there was any prospect of realising our assets - there doesn't appear to be any real prospect of  recovering their value in the foreseeable future.

"We bought the Peterborough site just before the first lockdown, at what turned out to be the peak of the market.

"We all know the demand for office space has been really hit by people still working from home.

"It might be best to cut our losses on that now - but it's clear that the company and the council isn't prepared to consider that."

The losses have also concerned North Ipswich MP Dr Dan Poulter who has been trying to get information about IBA from officials.

He said:  “After three months of unanswered emails and enquiries about financial information that should already be publicly available, Ipswich Borough Council has finally come clean and admitted that it has wasted £6.3 million of council tax payers’ money on an unwise and poorly considered property investment strategy.  

"Worryingly, the accounts also indicate an ongoing operating loss.

"It is clear that Ipswich Borough Council lacks the financial expertise to manage its finances properly and this will need to be urgently addressed if we are to avoid more local taxpayer money being wasted."

While concerns have been raised about debts faced by local authorities - figures show that in Ipswich the figure is not far from the national average.

Across England council debts are an average of £1,805 per person according to figures released last autumn. In Ipswich debts across both the borough and council council are about £1,900 per person.

But across Britain the figure varies hugely - in Surrey some councils have huge debts. Woking council has debts of more than £19,000 for every person in the district.