Mayor and councillors agree changes to prevent another Bristol Energy

Hatchets were buried as elected members of Bristol City Council unanimously backed a series of changes to prevent “another Bristol Energy”.

Mayor Marvin Rees, who also voted to support the motion from the opposition, was accused of remaining “in denial” as he blamed the previous administration for setting up the doomed company in the first place.

Bristol City Council poured at least £39.7m of taxpayers’ money into the energy firm, which lost nearly £50m before the local authority broke it up and sold it last year.

The political fall-out from the fiasco has haunted the current Labour administration since 2016, when they inherited then persisted with the company set up by the previous cross-party cabinet under former mayor George Ferguson in 2015.

On Thursday, February 11, even as they came together in a rare show of cross-party unity, Labour and opposition councillors continued to blame each other for the “huge” losses to the taxpayer as a result of the scandal.

Rees said the “biggest error” was made when Bristol Energy was set up and began trading in a “very volatile, high-risk market”.

“As soon as we found an opportunity to exit from the market… we took it and did the best possible deal we could with the city’s resources.”

But Liberal Democrat group leader Gary Hopkins, who led the opposition charge, said it was “ludicrous” to put the entire blame on the previous mayor, despite the fact “he was a bit over optimistic”.

Councillor Hopkins said Ferguson might have been guilty of wearing “rose tinted glasses” where the company was concerned, but Rees wore them too for a while before overseeing “panic and indecision” and finally “cover-up”.

Gary Hopkins said Ferguson may have wearing “rose tinted glasses” when launching Bristol Energy. Photo: Gary Hopkins

The mayor and all 57 councillors who voted supported Hopkins’ motion to address flaws in the oversight and scrutiny of commercial firms owned by the council.

Those firms, which sit under the council owned parent company Bristol Holding Ltd, include Bristol Waste and the council’s fledgling house-building firm Goram Homes.

The Lib Dem motion, backed by the Tories, called on Rees to “accept and adopt (in total and without delay)” 12 recommendations from an independent report and set up a cross-party group to oversee the process, giving members full access rights to “potentially exempt information”.

The report from the council’s independent auditors Grant Thornton, which focused on Bristol Energy’s final full year of trading, 2019/20, shone a spotlight on “inadequate” decision-making and scrutiny arrangements and questionable openness and transparency.

Its findings vindicated opposition councillors’ long-held concerns about the governance of Bristol Energy, access to information and a deteriorating opportunity for scrutiny under the current administration.

The official, written council “management response” disappointed and infuriated members of the audit committee last month, but senior officers told them they were committed to adopting the recommendations and would give “regular, periodic confidential briefings” to the chair, vice chair and an independent member.

Rees said: “We said we accept the recommendations in the report and have put them in a timeline to delivery.

“One of the problems the report does not address is the fact that many of these governance issues were built into the very birth of this company, in that you have a local authority, with a commitment to transparency, launching an energy company in a volatile market where transparency over decision-making within that company would leave it at a disadvantage with its competitors. There’s an inherent tension in that.

Hopkins accused Rees of “covering up” the Bristol Energy fiasco. Photo: Bristol Energy

Rees added: “It was the wrong market to put a local authority into. There was a lot of group think, there was a lot of optimism about this is going to be the pathway to solving fuel poverty within the city…about this is going to be a revenue raiser for the local authority.

“But the truth of it is there’s an inherent risk in it, and Bristol City Council was signed up to participate in a very volatile, high-risk market, and it was the wrong market for the council to be put into.

“If we’re going to do the city a real service here…we really need to look at the full history of this company and begin to recognise that the biggest error made was actually putting Bristol City Council into the energy business in the first place.

“Let’s all stand up and take responsibility for the decisions we all made in the course of this company’s existence.

“I would absolutely welcome that, and that’s why we have called for a public interest review because we will then have that full history of the company and everyone who made decisions in the course of this company’s existence put in the public domain.”

Hopkins said: “It’s an absolute minimum that we actually accept what our independent auditors say but we must do more.

“It doesn’t solve all our problems but it does move us forward a little way and it hopefully reduces the chances of this happening again.

“A year ago we actually pressed for a full inquiry into Bristol Energy and it was voted down. I’m glad that Labour councillors are now agreeing that we need to move forward, but they bear responsibility because we actually started off in this with rose-tinted glasses from the previous mayor and for this mayor in the early stages, it then went into panic and indecision, and it finally finished up with cover-up.

“I’ve heard lots of encouraging words from members from all sides. I still do not hear the mayor accepting responsibility and committing to work with others to make certain that this sort of thing doesn’t happen again.”

The new rulings hope to ensure another “Bristol Energy fiasco” never happens. Photo: Bristol Energy

Green councillor Jerome Thomas said: “I, with a small number of other councillors, have been warning from the cabinet meeting in 2015, when Bristol Energy was set up, about the overoptimism of the business plan, the structure and oversight of the business, the company’s inappropriate levels of secrecy.

“This motion is a helpful and important step in improving the culture of Bristol City Council so that these sorts of mistakes can be avoided in the future.”

Tory group leader Mark Weston said: “We can all play a blame game another night as far as I’m concerned.

“The problem we’ve got is if we don’t learn the lessons of this, we will be doomed to repeat them, because we have similar ventures, with similar transparency issues, with also large amounts of money.”

The mayor and  57 of 67 councillors voted at last night’s extraordinary full council meeting, with four apologies.
There are three vacant seats after the departures of Harriet Bradley and Paul Smith from Labour’s ranks and the resignation of Green councillor Clive Stevens.

Amanda Cameron is a local democracy reporter for Bristol.

Main photo: Bristol Energy

Read more: Top Bristol councillors to get confidential briefings to avoid another Bristol Energy fiasco