Hoople records another loss

Opposition leaders say they are ‘extremely disappointed’ in the financial performance of a publicly-owned company set up to deliver council services.

Hoople Limited was set up by Herefordshire Council and the county’s NHS trust in 2011 to save money over the provision of back office support services such as human resources, recruitment and training.

The firm reported a loss for the year £414,424 in the last financial year. The previous year’s loss for the year was £294,394.

Independent group leader Bob Matthews said he was disappointed with the loss for the year because the company was set up with a remit to deliver various efficient and cost-effective services within house.

He said: “Members were assured at the time that within a few years the business would expand by successfully tendering for outside projects, resulting in a substantial financial return for the taxpayer.

“It is extremely disappointing therefore to note that this year, once again Hoople have recorded a considerable loss.

“This begs the question as to what the future holds for Hoople, who appear to be incapable of ever balancing their books.”

Liberal Democrat group leader Terry James said he did not see the point of the company which is ‘at arm’s-length’ from the council.

“It was supposed to be designed to cut costs and take on private sector work but it’s still producing a loss which will have to be met by the council,” he said.

“All we get from it is another management structure which is not as accountable.”

According to Hoople’s annual report and financial statements, a re-measurement of local government pension liabilities resulted in an accounting adjustment of £608,000 being recorded as a profit. This resulted in a total comprehensive profit for the year of £193,576.

A council spokesperson explained that the total figure was then adjusted to £13,576 after pension costs.

She said: “Hoople Limited is owned jointly by Herefordshire Council and Wye Valley NHS Trust, with Herefordshire Council being the largest shareholder.

“Hoople Limited is a ‘Teckal’ company and its day to day operations focus on supporting the shareholders who supply 80% of its revenue income.

“It does however provide a range of services to public sector and private sector customers.

“The company reported a total comprehensive profit for the year of £13,576, this is after all the necessary adjustments in respect of pension costs.

“A number of staff transferred from the council to Hoople Ltd when Hoople Ltd was created in 2011. Hoople Ltd has agreed a repayment plan for the Local government pension scheme deficit with the pension schemes actuaries, this is reflected on the annual accounts.

“The external auditors have audited the statuary accounts and have confirmed that Hoople Ltd continues to be a going concern.”