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Camden News - by RICHARD OSLEY and TOM FOOT
Published: 16 October 2008

Treasurer Mike O’Donnell has remained tight-lipped about where Camden’s money is being held

It isn’t in Iceland: but where have these two men put your money?

Finance chiefs say the banking collapse hasn’t hit their coffers – but fall short of saying how

FINANCE chiefs who triumphantly announced they had not fallen into the pitfall of storing council cash in bankrupt Icelandic bank Landsbanki have seized up in silence when asked to explain where the money has gone instead.
The Town Hall is refusing to name the financial institutions in which Camden’s money currently lies.
Senior councillors were warned the information is “a matter of public interest” and the secrecy did not breed confidence in their handling of public cash amid testing economic conditions.
The New Journal asked for the list of banks used by Camden on Monday morning, leading to three days of “umming and ahhing” about whether the information should be released.
The answer finally came back late last night (Wednesday): “No, we won’t give you that information.”
Camden’s taxpayers effectively now have no clear idea about which banks the Town Hall is investing money in, and must keep their fingers crossed that the department chiefs get it right.
Treasurer Mike O’Donnell was on reassurance duty at a meeting on Tuesday night, telling a panel of councillors: “There is a danger of crowing but Camden did not and never did have investments in Icelandic banks.
“The reason for that was that our approach is not simply based on credit ratings. Our primary objective is not to put our money at risk for the sake of a 1 per cent improvement.
“We would not lend to an institution that is not robust. A key part of our strategy is to invest across a number of institutions.”
The identity of those institutions, however, will remain secret.
Liberal Democrat finance chief Councillor Ralph Scott admitted yesterday that Camden was releasing less information than other institutions who had been asked for details about lending.
But he insisted the list of banks had to stay under lock and key for the taxpayers’ own good.
“The council invests its money with a number of banks – these investments change on a regular basis to ensure the best rate of return and that the investment remains secure,” said Cllr Scott.
“This is common practice. It would not be appropriate to provide information on individual investments held with particular banks as this could be commercially sensitive information, given the volatility in the banking system at the current time.”
He said he was taking daily advice from a range of “financial experts”.
The resistance is in sharp contrast to the heady rush of last Thursday morning, which saw the communications department fire out press statements confirming that no cash was tied up in the failing Icelandic bank.
While neighbouring Westminster City Council is chasing £17million, Camden has not been drawn into the fight for compensation.
The two authorities are friendly rivals in the world of local authorities and insiders said Camden is doing its best to avoid any sense of one-upmanship.
Cllr Scott would not be drawn on how often money was moved about and whether cash had been quickly withdrawn from any one individual bank.
Some members of the finance department claim that the tough conditions mean releasing the information would harm banks by revealing an indication of how confident local authorities are about doing business with them.
Labour’s finance spokesman Councillor Theo Blackwell said the deposits should be made public – just like the pension fund is.
He said: “We need to have more scrutiny of this. It is not commercially sensitive and I can’t see why this information is not being released. There are deeper questions about where Camden is investing its money that are not being answered.”

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