Council will borrow over £10,000,000
York Guildhall
The York Council has now admitted that the project to create a business club and restaurant at the Guildhall will cost £780,000 a year in interest charges.
It says it can only recoup £500,000 a year from rentals, leaving taxpayers to pick up an annual bill for £430,000.
Part of the huge escalation in costs results from the deterioration in the condition of the historic building since it was abandoned by the then Labour led authority nearly four years ago.
They had no idea what to do with the empty building so embarked on an expensive and time consuming international design competition in 2012.
The new coalition run Council had the option to take decisive action over a year ago but dithered. They had been strident, while in opposition, in criticising Labour’s £9.2 million plans for the building .
Originally, it had been intended to put the modern part of the complex on the open market with the intention of using the income to sustain the Listed building. The Council would have continued to use the historic part of the building.
The only justification for the project now seems to be a speculated increase in GVA (Gross Value Add) to the local economy of £66m. However, this would have occurred anyway with a private sector driven alternative.
The Council has already spent £750,000 on the project.
Potential support from regional organisations and the Heritage Lottery Fund has not materialised.
The Council now doesn’t expect the building to open before late 2018.
So why would seemingly intelligent representatives do a U turn on such risky venture?
Well it takes courage – and experience – to challenge Council officials and consultants. They have a vested interest in projects appearing to be a “success”. They will provide elected members with information which suits their version of events. They will not volunteer other choices (like testing the market with other use options).
A similar situation has occurred with the Stadium project.
We doubt if the Council’s Executive will step back from the brink at this stage
If they do so, they will be accused of wasting £750k of taxpayer’s money.
If they don’t, then costs will continue to escalate and taxpayers – and other public service standards – will suffer.
Jean Harrod will talk about her life as a diplomat. She worked behind the ‘Iron’ Curtain (East Berlin) during the Cold War, and the ‘Bamboo’ Curtain (Peking and Shanghai) after Mao’s death; and in many other embassies around the world.