A LEADING Tory councillor in Winchester has called for the city council's finance chief to resign over the collapse of an important mental health charity.

The call came from Councillor George Holingbery over a £350,000 debt owed to the authority by The Winchester Alliance for Mental Health, which shut its doors in a state of financial ruin last December.

More than 300 people were directly affected by the closure of the charity, which offered training for those suffering or recovering from mental illnesses, and which ran several outreach centres in the city.

Though the charity was essentially independent from the city council, the authority helped with its payroll in an arrangement that saw the authority pay the wages, which were then reimbursed by the charity.

In 2002 a cash flow problem at the charity meant it began defaulting on its duty to repay the council, and by December 2002 that debt had grown to £76,000.

The following year, Cllr Holingbery resigned from the charity's board of trustees after warnings he says he made to the city council about the unfolding crisis went unheeded.

In December last year bosses at the charity met and formally agreed to put the organisation into liquidation, amid further debts that were spiralling out of control.

At the time of its closure the charity still owed the city council some £350,000.

Now Cllr Holingbery is calling on Councillor Kelsie Learney, the council's portfolio holder for finance, to resign on the grounds that she should have stopped the debt in its tracks when the charity's cash flow problems came to light.

Speaking at a heated meeting of the full city council, Cllr Holingbery said: "Does the portfolio holder agree that, in a system of governance by Cabinet, the avoidable loss of £350,000 or eight per cent of council tax collected by the council could hardly be more serious and that, as the Cabinet member responsible, she should resign?"

Cllr Learney refused to be drawn on his demand that she should take sole responsibility for the matter, arguing that she was not one to quit when the going got tough.

She said: "Throughout, all members involved in the discussions have expressed the view that the charity provided a valuable service to a group of vulnerable clients and should be supported.

"When things go wrong, those with a sense of responsibility stick around to face the repercussions, to stand by the decisions that they made and to help with the investigation that has been commissioned."

An independent report into the collapse of the charity and the council's role in it is due at the end of March.