Lucy Powell encouraged government officials to reevaluate expensive legal action against a property development company in her constituency, which was established by a Labour donor, in an effort that might have spared the firm significant financial losses, CuriosityNews has learned.
During her time as a cabinet minister, Powell, who is widely expected to become Labour’s deputy leader this week, wrote to Angela Rayner advocating for Urban Splash, a Manchester-based developer founded by donor Tom Bloxham.
In her letter, Powell asked Rayner, then housing secretary, to reassess the administration’s “disproportionate” legal steps against the firm, shortly after encountering Bloxham at a Labour fundraising event.
Powell stated that she acted as a constituency representative and had done so “openly and transparently,” rejecting any suggestion of misconduct. Her actions come amid heightened scrutiny of MPs following recent controversies over influence-peddling.
The issue involves Urban Splash, which was instructed in March 2024 to return £49m in public funds, under a Conservative-led government.
According to housing authorities, the money had been allocated to ensure seven Manchester buildings complied with safety regulations introduced after the Grenfell Tower tragedy. Officials sought a legal order to compel the developer to fund the required renovations.
However, in her letter dated 10 December 2024, obtained by CuriosityNews, Powell urged officials to “exhaust all options to resolve the matter without prolonged court action,” warning that litigation would “burden taxpayers and potentially force Urban Splash into insolvency.”
She included a letter from Bloxham dated 5 December, in which he mentioned their meeting at the Rose Network event the previous evening. Bloxham criticized the housing department for “aggressively targeting us with harsh legal tactics” and using Urban Splash as a “scapegoat” to deflect attention from its own “errors and mismanagement.”
He expressed feeling “betrayed by a government I supported,” and referenced a video highlighting his company’s 30-year history, which he claimed to have shared with Powell during their conversation.
Electoral records indicate Bloxham contributed £8,807 to Labour in 2020 and had previously donated to Tony Lloyd, Powell’s predecessor as Manchester Central’s MP.
A spokesperson for Powell stated: “As a local representative, Lucy has frequently engaged with officials on building safety concerns, meeting with residents, property owners, and developers. In November, Urban Splash raised their challenges during a constituency meeting, prompting her to request written details for follow-up—standard practice for MPs assisting local stakeholders.”
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