FRANK McAveety’s return as Glasgow city council leader has been soured by a cronyism row over an off-market property deal with a party donor.
The Labour-dominated Executive approved the “principle” of a property sale that would expand A.S Scaffolding’s business substantially.
SNP councillor Susan Aitken said the Nationalists would be keeping a “close eye” on how any deal progressed.
McAveety was elected as Gordon Matheson’s successor as leader on September 10th and immediately set out his stall to keep the local authority in Labour hands.
However, previous administrations have been dogged by claims of questionable links with Labour donors and opposition councillors are intent on scrutinising the new regime.
On Thursday, the Development and Regeneration Services (DRS) department brought forward proposals involving a Labour donor to a meeting of the council Executive.
Councillors were asked to approve the principle of an off-market deal to Glasgow-based A.S Scaffolding, co-owned by Andy Smillie.
It was also recommended that the managing director of City Property, an arms-length body controlled by the council, negotiate the terms and conditions of the disposal.
The Executive, which has an in-built Labour majority, gave the thumbs-up to the recommendations.
The council land amounts to 2,306 square metres covering Glenpark Street, Millerston Street and Duke Street.
The fragmented sites were declared surplus to the council’s “operational requirement” but do not appear on the local authority’s 3 year marketing programme.
City Property received an approach from Smillie, the company's managing director, about acquiring the sites to expand his business.
However, the DRS report states that the businessman wouldn’t make a formal offer until he was given the assurance of being able to negotiate an acquisition.
According to the Electoral Commission and other official returns, Smillie and his business have donated nearly £10,000 to Labour or party candidates.
A.S Scaffolding’s latest accounts also reveal a £10,000 donation to the Glasgow Lord Provost’s Charitable Trust.
In 2013/14, shareholder funds in AS Scaffolding stood at £4.6m.
Aitken, the SNP group leader on the council, said: "SNP members of the Executive Committee asked a number of questions about why this transaction is being conducted off-market and why there wasn't even an estimate of what kind of capital receipt the Council might expect from the sale of this land, particularly given this is a part of the city where there has been recent development.
"We'll be keeping a close eye on this deal as negotiations go ahead and we'll expect to see the Council get the best possible value return for this land if a sale does go ahead."
David Meikle, a Tory councillor in Glasgow, said: “This is not a good start by the new Labour council leader Frank McAveety. The Council set up City Property to sell off land and property in an open market securing value for money. With this 'off market' deal the public will rightly question if proper process is being followed and whether it delivers best value. Labour complains about budget cuts but leaves itself open to allegations of cronyism and failing to protect the public purse."
A Council spokeswoman said: “AS Scaffolding discussed their desire to expand with Councillor Carey who was at that time the chair of City Building. His advice was that they should discuss it with the managing director of City Property and he asked her to contact AS scaffolding, which she did."
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