PORTSMOUTH City Council has come under fire after it spent £8m – on a warehouse more than 100 miles away.
The authority has snapped up an industrial unit near the M50, in Gloucestershire, so it can rent it out to firms and make a yearly income.
The Tory administration spent the cash from a £30m pot of money it borrowed earlier this year to buy properties they could make money from.
But the move comes at a time when the council faces making £16m worth of cuts next year – and £6m of that is down to the children and education and adult social care services being overspent.
And city Lib Dem leader Gerald Vernon-Jackson questioned why the council chose to invest in Glouchestershire – and not Portsmouth.
Cllr Vernon-Jackson said: ‘The priority should be, if there is money to invest, about creating jobs and wealth in Portsmouth.
The priority should be, if there is money to invest, about creating jobs and wealth in Portsmouth.Portsmouth Lib Dem leader, Councillor Gerald Vernon-Jackson
‘That should be the first test. Our priority is to improve the economy in Portsmouth, not in Glouchestershire.
‘That’s someone else’s job.
‘For us, it should always be about Portsmouth first.’
Cllr Vernon-Jackson said the council should be exploring what to do with the former Tricorn site, where plans for a £300m Northern Quarter shopping complex have failed to materalise, and the vast expanse of land in Tipner under-developed.
Cllr Vernon-Jackson added: ‘There are lots of places in this city where if there is money to invest, we should be investing in them.’
But the council insists it has made the purchase without creating any new debt – and profit from the deal would be able to offset the impact of spending cuts.
And the Tory cabinet is seeking to increase the amount of money available in its £30m investment pot to £50m – by borrowing from the banks.
A decision will be made at a public meeting on December 3.
Tory planning boss Luke Stubbs said: ‘This is a new strategy for Portsmouth, but it is something that is already being undertaken by other local authorities across the country.
‘Property investment is a good way to draw at least some of the sting from the spending cuts.’
Plans for further property spending are already underway, with deals expected to be completed in the ‘coming months’.