A long and acrimonious dispute between Watford Borough Council and a charity for the elderly has finally been concluded – prompting fresh calls for a full investigation into the matter.

The council had threatened to sue Age UK for £500,000, claiming the money was necessary to pay for repairs to two buildings rented by the charity.

After protracted and at times feisty period of negotiation both sides formally concluded a settlement that was first agreed earlier in the year for a reputed sum of just £32,500 – an amount neither side has confirmed or denied.

The dispute centred on two council-owned buildings used by the charity (in Exchange Road and The Harebreaks) for a combined peppercorn rent of just £193 a year. Under the terms of the agreement between the two sides, The Harebreaks has returned to full council control, with Exchange Road remaining in control of Age UK.

Councillor Steve Johnson, leader of the council’s Conservative Group, this week repeated his calls for an investigation into the “fiasco” and said several crucial questions needed to be answered.

In a letter to the Watford Observer he said: “The Mayor spent months arguing that it was only fair to Watford Council-Tax payers that this money was recovered, so why did the Council then accept a fraction of the costs demanded….

“…Why has the Mayor and the property department hounded a widely respected Charity, only to recover a sum that is similar to the amount the Council have spent on the legal costs pursuing the case?

“The Conservative group on Watford Council will be demanding a full investigation into these events, to ensure that we can learn from this fiasco.”

Council managing director Manny Lewis argued that Councillor Johnson’s figures were “incorrect and incomplete.” He added: “We could have gone to court, but we didn't think this was the right thing to do with a charity and we reached a settlement which Councillor Johnson himself supported.

“I understand that the overall cost of the improvements Age UK are making to the Exchange Road property will be a substantial sum, far greater than the amount referred to by Councillor Johnson. We are, as a result, able to more quickly bring Harebreaks back into community use and we can now work together with Age UK looking forward rather than backwards.

Mayor Dorothy Thornhill said she was “stunned” by the latest criticism and suggested that Councillor Johnson was playing politics ahead of this month’s Nascot Ward by-election. She added: “All party leaders supported the council agreement back then but is he really now saying we should bankrupt a local charity?

“We inherited old leases and have since improved our policies for these sorts of things. It was a difficult negotiation but we reached an agreement with the charity and at the same time got the best deal for council tax-payers."