Why The Plough costs the Parish Council nothing
We hear that some people may not understand how our PWLB loan works, and how it makes The Plough cost-free for the Parish Council. So here's a quick explanation!
Last year Longparish village (through the Parish Council) became the proud owner of The Plough, purchased with government help to provide a self-financing community hub and pub. Here’s a quick explanation how this project is costing the Parish Council nothing!
Owning The Plough is cost-free for the Parish Council
The group organising the renovation and business of The Plough (Longparish Community Pub Limited “LCPL”) is completely separate from the Parish Council. All that the Parish Council have done is to take out a loan to buy the land and building. We lease The Plough to LCPL and LCPL pays us rent which covers all the costs of repaying that loan.
The Government (PWLB) loan
The Parish Council borrowed £300k at a cheap rate from the government, which wants to encourage villages to invest in the future of their communities.
The loan will be repaid over 50 years at a low, fixed cost each month.
LCPL pays rent to the Parish Council every month to cover that fixed loan payment. So, owning The Plough is effectively ‘free’ for the Council.
LCPL paid all the costs of buying The Plough and continues to pay all related costs such as insurance, so there has to date been NO cost at all to the Parish Council*.
LCPL has also given the Parish Council a rent deposit.
LCPL gets a cheap rent as they paid a rent premium (extra money to help us buy The Plough) and are a not-for-profit community business. The hard work and funds raised by LCPL have improved the value of asset, which is great for the community.
Government loans are popular in villages
Longparish used another government loan to refurbish the village hall 10 years ago. In that case payments were made by the Parish Council itself from the precept. That loan will end (fully paid off) in September. Without loans such as this it is expensive for villages to raise money to buy or improve village facilities. The Parish Council could take out another government loan in the future if the community needs help with another project.
Community business
We are delighted that the pub is now open and building up a good business. Many local people have donated time and personal money to help support the renovation, and a second share offer is currently under way to help finish the project.
The Plough is becoming a valuable hub for the community. As the community rooms, car park and garden come into use we are proud of Longparish’s new 300-year-old asset!
* See PC accounts section of Longparish website for detailed Plough costs. Please contact the Clerk if you have any questions.
You can find details of the payments reimbursed by LCPL to the Parish Council here.
We hope this is helpful. This issue was raised at a recent Zoom meeting to update members of the public about current progress at The Plough, so we wanted to explain clearly how the loan works. A copy of this explanation has also been posted on village noticeboards, and a link has been added to the village Facebook page - we hope you will share this information and let us know through the Clerk if you need more help.