Loans made to property companies – including three controlled by Manchester City’s Abu Dhabi owner – while Andy Burnham was Greater Manchester mayor are being investigated by councillors.
About 50 developers have been lent more than £1bn between them from a fund managed by the Greater Manchester Combined Authority (GMCA) since 2015.
John Leech, the chairman of the GMCA’s Overview and Scrutiny Committee, told the concerns had been raised about the transparency of the process to approve the loans.
“We just want to be clear that there is a transparent rather than an opaque process,” said Leech, who is the Liberal Democrat opposition leader on Manchester City Council.
He said the approval process had been criticised as “very opaque in the past and that it’s not necessarily been clearly understood why X was successful and Y wasn’t”.
A GMCA spokesperson said it was supporting the committee with its enquiries.
Downing Street did not comment.
The money came from the Greater Manchester Housing Investment Loan Fund (GMHILF).
The fund was set up in 2015 with an initial £300m of government investment to help developers build new homes across Greater Manchester.
Three property companies ultimately controlled by Manchester City owner Sheikh Mansour bin Zayed al Nahyan were granted loans worth about £55m in total.
The decisions to approve these loans were taken in 2017, in two meetings which were both chaired by Andy Burnham when he was mayor of Greater Manchester.
The decisions to grant loans from the fund were taken publicly by all members of the GMCA, not the mayor alone.
One of Manchester’s leading property developers, Renaker, has received the majority of the £1bn lent out from the fund.
Renaker has been involved in a long-running legal battle over £140m worth of loans made to the developer through the GMCA’s fund.
A rival developer, Aubrey Weis, claims the the loans were unfair subsidies.
In June, the Court of Appeal found there had been “no error of law” in the GMCA’s decision to provide the loans but Weis is appealing the decision.