A housing company established by Norwich City Council to build affordable homes and generate revenue has cost taxpayers millions, after a leaked report revealed serious governance failings and financial mismanagement.
Lion Homes, previously known as Norwich Regeneration Limited, is now in liquidation after years of financial losses. The firm, set up in 2015, aimed to deliver both private and affordable housing, but spiralling debts and poor oversight led to its collapse. The council has written off a £6.15 million loan to the company, with total losses exceeding £5.7 million.
A report commissioned from consultants 31Ten, seen by the BBC, found that the company’s goals were unclear and not properly tracked against performance indicators. Most notably, a shareholder panel designed to oversee the firm’s activities which included councillors failed to meet for nearly a year, despite being required to meet quarterly. The last recorded meeting was in November 2023.
The report also highlighted a potential conflict of interest: all four Lion Homes employees were also part of the council’s housing delivery team.
Norwich City Council, which is Labour-led, has cited “spiralling borrowing costs and a hostile planning system” as contributing factors to the company’s downfall. However, opposition Green councillors argue that internal mismanagement played a far greater role.
Green group leader Alex Catt described the situation as “shameful,” saying the company lacked “basic governance, accountability, and clear purpose.” He added that his party’s repeated warnings about the company’s operation had been “completely ignored.”
A separate financial review by Grant Thornton suggested that liquidating Lion Homes could recover up to £4.5 million through asset sales, helping to reduce the council’s outstanding debt.
Cabinet member for finance and major projects, Carli Harper, confirmed a full audit and scrutiny process would take place. She also announced that future housing development would be brought directly under council control, rather than managed through a separate company.
“This approach ensures more transparency and accountability,” Harper said. “We remain committed to delivering the housing Norwich needs.”
Lion Homes had previously suffered major setbacks, including a 2020 project in Bowthorpe where properties were sold at a loss of £6 million.
With the company now dissolved, questions remain over how a publicly funded initiative intended to support affordable housing was allowed to run into such disarray.
