BURNLEY'S council house repair team could have suffered a substantial loss, housing bosses have warned.

Exact financial results for Burnley Maintenance Services for the year to March 31 are still not known, officers admit.

But they have flagged up a "bad news ahead" warning for the department which already has a Government "yellow card" for problems in the past.

And council chief executive Roger Ellis has already ordered a full investigation into the trading performance and why councillors had not been told earlier.

If a major loss is confirmed for the £2 million-a-year section - and exact figures are expected within a fortnight - it could lead to the Government ordering the contract to be re-tendered and BMS being barred from bidding, says a private report to tonight's housing committee meeting.

Invited

The report indicates that neither possibility is likely to apply with the contract already in its final year and the tendering process due to start in any case, and informal contact with a Government department suggesting that BMS can be invited to tender again.

However Burnley council tax payers will be called on to make good any losses, councillors have been told.

In the report to councillors, community services director, Ian Saville warns of a "major problem" and "significant trading loss" in the department, set up after the council's contract services section was disbanded after years of large deficits.

The report shows that in the previous year BMS made a surplus of just £1,050 on a potential £2.1 million turnover.

Mr Saville says the key reasons for the expected losses are higher than expected spending on materials, the cost of sub-contract work and lower than anticipated income,

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