By Paul Francis, Political Editor, and Caitlin Webb, local democracy reporter

County councillors say more scrutiny is needed on the performance of companies where it has invested taxpayers’ money after a report revealed they recorded losses of nearly £15m.

The money was invested in a series of companies under the Regional Growth Fund, a pot of government cash designed to stimulate local economies, and in some cases dates back several years.

The Kent County Council investments were designed as “seed money” to help the companies set up their businesses.

KCC has supported a number of them by acquiring shares under various regeneration programmes such as Expansion East Kent, Tiger and Escalate.

While there is no question that KCC is at risk of losing money, councillors have expressed disquiet over the performance of some of the companies which have in some cases reported losses running into hundreds of thousands of pounds.

One company where KCC acquired £250,000 of shares is dormant and not trading and recorded losses of £156,396 in 2016-17. Another posted losses of £707,868.

The issue was debated by county councillors at a meeting of the cross-party governance and audit committee yesterday.

Cllr Alan Marsh (Con) said: “I see no difference at all between this being KCC money or Regional Growth Fund money. We are responsible for fiscal credibility, showing that we are able to run and fund in the best interests of the people of Kent.

“I cannot believe that in our role of audit, we would accept or believe that we are doing our duty of care when figures go back to 2016. We need to know that when we get into these deals, we will make a difference."

He said that as a result of the losses recorded by some, there had been no dividends paid to KCC and that the council needed to show a “duty of care” to council taxpayers.

Cllr Harry Rayner (Con) said there was a question around whether KCC could be satisfied that its auditing of the companies was satisfactory.

He said: “Are we satisfied with the process that assesses these as going concerns?

"When you audit a company, you audit whether it is a going concern. The answer is yes or no.”

Green county councillor Martin Whybrow said it was not just a question of the council seeing a financial benefit from its investments.

“Where we do get dividends, the idea is that they are recycled back into the economy. With the investments and loans, it was not just about financial payback.

"There were clear targets for job creation and job retention. I am far from sure those targets have been reached.”

Liberal Democrat opposition leader Cllr Rob Bird said the council needed to provide more detail of how the companies had progressed since they had benefited from the investments.

“We were told that some of these companies would go through challenging spells before we could expect to see a return but some of these assurances were made two or three years ago and we are not seeing a return. I do think it is time for us to look in detail at some of these investments.”

"There were clear targets for job creation and job retention. I am far from sure those targets have been reached" - Cllr Martin Whybrow

Cllr Nick Chard, committee chairman, said he acknowledged that there were questions that needed answering.

The amount of money invested in shares ranges between £1.1m to £29,000 and the companies include pharmaceutical businesses and data and technology firms.

Some investments were made with start-up companies at the former Pfizer factory in Sandwich through the Discovery Park Technology Investment Fund.

The most significant interest KCC has is in a company called Digital Contact, with the authority acquiring shares at about £1.2 million, giving it a 10% stake in 2015.

According to the authority, its last accounts recorded losses of £543,550.

Kent Online has contacted the company but has not yet had a response.