East Lindsey District Council faces scrutiny over a series of loans totaling £4.4 million made to a company it established to manage local services. Currently, only £521,828 has been repaid, raising concerns about the financial health of Invest East Lindsey, the company in question.

In an internal council report, KPMG, the council’s external auditors, flagged “significant weaknesses” in the company’s management. The company reported a loss of £474,000 for the year ending March 2024.

Council leader Craig Leyland acknowledged that the loans were renegotiated due to factors like interest rate hikes following the Liz Truss government’s budget. He remains confident the loans will be repaid in full with interest.

However, opposition leader Jill Makinson-Sanders criticised the situation, stating that the council had failed to protect taxpayers’ interests adequately. During a recent audit and governance committee meeting, she expressed disappointment at the problem’s handling.

The West Yorkshire Pension Fund (WYPF) is expanding its natural capital investments with a £27 million equity stake in Foresight Natural Capital. This move follows the growing trend of pension funds investing in forestry as a stable, inflation-resistant asset but extends to broader natural capital opportunities, including biodiversity projects, peatland restoration, and sustainable agriculture.

WYPF, which manages £19 billion in assets, sees natural capital as a key part of its alternatives strategy, which now makes up nearly 20% of its portfolio. Sustainable agriculture has gained attention due to its ability to support ecosystem health, enhance soil quality, and reduce carbon emissions, all of which contribute to long-term resilience and economic sustainability. However, Ward notes that transitioning to regenerative agriculture involves risks such as yield uncertainty, which can deter some investors.

In addition, WYPF’s investment in Rebalance Earth, which focuses on nature-based infrastructure solutions for climate change, highlights a new approach to climate resilience. This sector, traditionally funded by public and philanthropic sources, is now attracting institutional capital. Rebalance Earth uses innovative revenue models, such as Nature-as-a-Service (NaaS) contracts, to offer predictable cash flows while addressing sustainability challenges.

Both investments reflect WYPF’s strategy to target emerging natural capital markets and align with global sustainability goals, despite challenges in quantifying returns and impact in these evolving sectors.

City of Doncaster Council’s plan to reopen Doncaster Sheffield Airport has drawn scrutiny from auditors over financial risks tied to the £105 million investment. A report from Grant Thornton, the council’s external auditor, raised concerns about the scale of public funding allocated to the project and its financial viability.

The council has established a publicly owned company, FlyDoncaster, to manage the reopening after failing to secure a private operator. The proposed funding, drawn from South Yorkshire devolution money, includes low-interest loans amounting to an effective subsidy of nearly £90 million.

In November, Grant Thornton sent a letter to the council’s chief executive warning of increased financial exposure, which has risen from an initial estimate of £16 million to over £100 million. The auditors described this escalation as a “major concern” and cautioned against the risk of “escalation of commitment” should the project fail to meet financial expectations.

A separate report revealed that the estimated cost of lease payments on the airport site has jumped from £14.8 million to £56.6 million. The audit firm advised the council to conduct further financial assessments and establish contingency plans if risks exceed acceptable levels.

The UK government has since expressed support for the airport’s reopening, though it has not committed national funding. Meanwhile, Munich Airport International has been brought in to provide operational and management services.

South Yorkshire Mayor Oliver Coppard has delayed a final decision on the investment until the summer, citing the need for independent financial assurance. Internal reports have flagged risks to public funds, prompting further review before committing devolution money to the project.

The number of registered companies in South Yorkshire has reached a record high, rising to 75,130 from 73,897 at the end of 2023. Over the past year, 11,673 new businesses were established, with Sheffield leading the way (4,792), followed by Doncaster (3,415) and Rotherham (2,064), according to data from Companies House and the Office for National Statistics.

Nottinghamshire has also seen strong business growth, reflecting a wider trend across the East Midlands. The increase comes despite economic uncertainty linked to regulatory changes, the upcoming General Election, and external factors such as global instability.

Nationally, business formations reached a record 5,637,210, up from 5,476,772 in 2023. While 848,192 new businesses were registered across the UK, 690,501 were dissolved. The data highlights ongoing resilience among UK businesses, even in a challenging economic climate.