Council chiefs in Thanet have admitted they did not weigh up the risks of a £3.3m package of savings to cover a financial black hole caused by the collapse of ferry company Transeuropa.

The council says it did not carry out a formal strategic risk assesment of its savings plan, forced on it after Transeuropa went into administration owing £3.3m in deferred berthing fees at Ramsgate port.

In a response to a Freedom of Information request made by the KM Group, the council said
a formal strategic risk assessment was “not considered necessary”.

The measures include a £1m cut to the housing benefit budget.

It said: “The council was fully aware of Transeuropa’s financial difficulties but felt it to be both necessary and reasonable to offer financial support by way of deferring fees and agreeing a debt repayment plan to try and prevent the company going into administration.

“The then [Conservative] leader of the council and the finance portfolio holder were aware of the approach being taken and the auditors were also aware and expressed no concerns."

The council also said it had not carried out any research the measures would have on vulnerable and minority groups – known as “equality impact assessments”.

It said these too were not considered necessary, stating: “The sources relate to earmarked reserves and the draw down against these reserves will have no impact to the residents of Thanet. An equalities impact assessment is therefore not relevant.”

The revelations come as council leaders face further pressure to explain why the deal with Transeuropa was kept secret from members.

The council’s cross party audit committee, which acts as the spending watchdog, will examine the circumstances surrounding the deal at a meeting tonight.

The chairman of the committee, Cllr John Worrow, said the committee had not been briefed over the deal nor received any formal report on it.