Austerity Bites Deeper in Carmarthenshire

NEWS REPORT JANUARY 18th 2020

Scarcer services and higher charges – that’s the message from Carmarthenshire County Council’s budget proposals for the next three years. People receiving care, travelling on county-maintained roads and needing to use public conveniences and household waste sites are likely to find services harder to obtain, and increased costs.

Home care cuts

Fewer people receiving domiciliary care would have visits from two carers at a time. At the end of September 2019 25.4% of the 1,085 care recipients had ‘double handed’ visits, and the proposal is to reduce this to 18% by the end of March 2022, saving the council £429,000 over the budget period, which runs from 2020-21 to 2022-23. There is also a plan to cut the number of care clients receiving four or more visits a day, by 1% a year, saving £34,000.

Clients having seven or fewer visits a week, so-called ‘small packages’ would not be exempt from the cuts, either. In 2019-20 268 clients, 24.7% of the total, were in this category. The proposal is to cut this number by half, for a saving to the council of £234,000. There would also be less direct support (but more advice) for incontinence sufferers, to cut £250,000 over the three years.

Clients for the re-enablement service, which helps some hospital leavers towards regaining their independence, would have to become more successful in this aim. In 2018-19 44%of the 650 people helped by the service did regain their independence, while the others moved onto a care plan. The plan is to raise the percentage achieving independence to 55%.

A new charge of £1,000 a year could be levied on people who pay for themselves in residential care, if the local authority commissions their place for them.

Domiciliary care and re-enablement together cost £13.924 million in 2018-19. The council feels it needs to remove £2.988 million over the three years, at a time when the county’s population is ageing and need for care services is growing.

Services for people with learning disabilities and mental health conditions would also suffer cuts. Three people would be moved from residential care to live with families, saving £468,000 over three years. There is also a proposal to move some clients from residential colleges to “supported living and community options”, a cut of £156,000 over three years.  There would be less funding for supported living, with the aim to “promote independence and enhance daily living skills”, and removing £315,000 from spending over the three years. There would be fewer places in residential homes, again to “promote independence”, to achieve a large saving of £1 million between 2020-21 and 2022-23.

Axe over public toilets and household waste sites

Council-run public toilets in Llanelli Town Hall, Llanelli bus station, Ammanford and St Clears could be closed, saving £100,000. Remaining public toilets would be twice as expensive to use, 40p compared with 20p. They currently cost £559,000 a year to clean and maintain, and the plan is to remove £200,000 over the three years, too big an amount for toilet users not to notice.

There is also the possibility of closing the household waste site at Whitland, to cut £80,000 from the budget. The other household waste sites, at Nantycaws, Trostre and Wernddu near Ammanford, would close for two days a week, and if Whitland did not close, that too would be open only five days a week. A move from seven-days-a week to five days opening could save £104,000 over three years.

Drivers would find parking dearer, each charge band increasing by 20p. Car parks would no longer be gritted, except at surgeries. There would be no more routine mechanical road sweeping, the council would stop paying for amenity grass cutting along highways, and would charge landowners for clearing trees that fall onto roads.

Small primary schools at risk

Cuts to primary school budget are expected, too. The £56.252 million delegated to primary schools would be reduced by £500,000 in 2021-22 “through carefully selected decommissioning and strategically driven school federations” to reduce the quantity of primary school buildings. The cuts could lead to the closure of the smallest primary schools, although the Welsh Government has a policy to keep small schools open wherever possible. Children’s services education and child psychology face a big reduction of £100,000 in 2020-21, from the current budget of £587,000, resulting in less support for children in need of help.

There are many other proposals for cuts, as the council struggles to survive on fewer resources and endures a continuing climate of financial austerity. The suggestions have not been approved yet, and the public can have their say via an online consultation at https://www.carmarthenshire.gov.wales/home/council-democracy/consultation-performance/current-consultations/budget-consultation-202023/ The consultation is open until January 28th.

PDR

Advertisement

Japanese knotweed invasion defeats council finances

See also the Carmarthenshire Herald, July 29th, p.2

If you see menacing Japanese knotweed on private land near your property, don’t think about asking the council to issue a Community Protection Notice. Carmarthenshire’s Executive Board agreed this week (July 26) not to get involved in problems of Japanese knotweed, and other invasive non-native plants, like Himalayan balsam, on land it does not own. The council will continue to remove Japanese knotweed from its own properties.

Japanese knotweed can grow a metre a month, a new plant can appear from a single centimetre of chopped stem, and in 2015 the UK government estimated that national eradication would cost around £1.5 billion. The cost and work involved in removing the weed can stop property sales and blight whole areas. The plants can crack concrete and other construction materials, and crowd out other species, diminishing biodiversity.

Japanese knotweed can grow as fast as one metre a month 

Carmarthenshire’s problem is lack of money to tackle both Japanese knotweed and Himalayan balsam, which have been spreading over the county, especially along the banks of rivers and streams. The Executive Board is asking the Welsh Local Government Association to urge the Welsh Government to find more cash for the control of invasive plants, which the Home Office now regards as an anti-social behaviour problem.

The Home Office does not go so far as to blame the plants, but places responsibility on owners of land which the weeds have invaded. The Anti-social Behaviour, Crime and Policing Act 2014 gives local councils and the police power to order landowners to control invasive species, by issuing a Community Protection Notice which, if ignored, could trigger a fine – as high as £20,000 for companies.

But the county council is very wary of using Community Protection Notices for weed control. Legal advice to the Executive Board pointed out that there are “few means available to landowners to physically tackle Japanese knotweed, and these are of limited effect”. It is quite possible, the Executive Board heard, that the requirements specified in a notice might not work. The available methods are also expensive, which would provide recipients of a notice with a valid ground of appeal.

Council experts concluded that investigation and enforcement to remediate invasive species would be very time consuming and “therefore very resource intensive on the officers of the section”.

Individuals and groups do have the possibility of pulling a ‘community trigger’ to require a local authority and the police to undertake a case review and consider what can be done to resolve the problem, so Carmarthenshire might yet be drawn into this knotty issue.

That is, if the insect attack fails. Plant lice called Aphalara itadori have been imported from Japan to feed on knotweed infestations. The idea is for the lice to weaken the plants so that their growth is stunted, the BBC reported last week.

This is a foray into the unknown, because no one knows exactly how the lice will react with plant and animal life in their surroundings, but other methods have failed to stop the inexorable spread of the weed pest.

PDR

Council homecare service set to shrink

See also the Carmarthenshire Herald, July 22nd, p.6

Long-term council-run homecare services for the elderly and disabled in Carmarthenshire face severe cuts.

Public services trades union Unison is so alarmed that the Carmarthenshire branch organised four meetings for members this week, and four more are scheduled for next week, in Llandeilo, Carmarthen, Llanelli and Ammanford.

The county council has considered three main options for homecare: to outsource; to create a local authority trading company (LATC), owned by the council but separately managed; or to form a social enterprise, a community interest company (CIC). The choices are listed in Carmarthenshire’s Vision for Sustainable Services for Older People for the Next Decade: Promoting Independence, Keeping Safe, Improving Health and Well-Being 2015-2025, a strategy paper prepared by the county council.

The preferred choice is a LATC, because it “offers the best potential in terms of improving the quality of services, allowing lower costs for the council, satisfying democratic accountability and satisfying stakeholder requirements”, in the words of the paper.

However, an arms-length trading company is considerably less transparent and accountable than the council itself.

The option of retaining the current council-run service, which provides about a quarter of homecare visits in the county, is rejected in the strategy paper as “not a cost-effective option”.

Worse service, fears Unison

Unison fears that further commercialisation of homecare would result in a worse service, higher fees for clients, or lower incomes and poorer conditions of work for staff. “Workers who transfer from local government employment to another organisation are protected by TUPE (the Transfer of Undertakings (Protection of Employment) Regulations 2006), but the protection does not apply to new recruits,” said Mark Evans, secretary of the Carmarthenshire branch of Unison. “For that we need TUPE+, which is voluntary and not a legal requirement, and even when given it is normally time-limited.”

“We are all for an efficient service,” said Mr Evans, “but if all homecare becomes a commercial operation, the emphasis will be on profits and not on supporting in the best way possible those who need care.”

The county council says that no decision has yet been made. “Whilst we are continually looking for ways to improve social care services and ensure their sustainability for the future, there have been no decisions on any different models of governance,” commented the council’s press office.

Resources reduce, need expands

The council’s strategy paper highlights the expanding gap between resources and need. Already 28% of all adults in Carmarthenshire are over 65, and by 2030 the proportion is forecast to rise to 34% — more than one adult resident in every three. The numbers living with activity-limiting long-term illnesses is expected to rise by a third, the numbers with dementia by 50%, and those requiring “community based services” also by 50%.

At the same time, the available cash to meet these needs is shrinking.

“We spent £37 million on social services for older people in 2015,” says the strategy paper. “This budget will reduce by at least £2.2 million, because the money that the council receives from central government is reducing over the next three years. When we take into account the growing demand over the next three years, we expect a funding shortfall of at least £3.5 million by 2018.

“This means that in three years’ time, we will have at least 10% less resources available to meet the needs of older people who are currently eligible for services.”

Therefore, says the council, the ways in which services are provided will have to change.

This means less care for many. The council cites the ‘National Eligibility Criteria’ for social care, which came into effect in April, and says in the strategy paper “Under the new criteria, people will be eligible for a care and support package if their needs can and can only be met by social services intervention.

Families and volunteers called on to fill gaps

Instead of council-supplied care being the default option, it will become a last resort if families, friends, and voluntary services can show they are unable to cope with an individual’s care requirements.

A “new contract with citizens and communities” is an important part of the effort to make fewer resources go further. The “contract” would encourage individuals to take more responsibility for their own care and promote healthier lifestyles, but this is the opposite of a quick fix as change would be measured over decades, not single years.

Fewer elderly people can expect home visits by two staff at a time. According to the council’s review, “Research shows that the quality of care is better when it is provided one-to-one.” Also, calls are likely to be less frequent than at present. The council suggests that frequent visits reduce elderly people’s independence and says that “other community services will need to tackle vulnerable users who are at risk of loneliness or isolation.”

Time credits are one way ahead, the council argues. For each hour of volunteering, individuals in the community would receive a time credit which could be exchanged for a form of help useful to them. Volunteers and families, the council hopes, would reduce the impact on elderly people of sparser homecare provision.

PDR

Llandovery Playgrounds at Risk of Closure

Children in Llandovery face the potential loss of their playgrounds.

Castle Fields Playground and the adjacent Skate Park, Maesglas Playground and Green Lodge Playground are owned by Carmarthenshire County Council — which is trying to offload parks and playgrounds to save on maintenance costs.

The Llandovery play areas have been offered to the town council, which feels unable to take them on for the same reason – lack of money.

Stephen Carter, clerk to Llandovery Town Council, said members would have to raise the annual precept by about 25% just to bring the Castle Fields Playground up to the standard at which they could obtain public liability insurance cover for it. “We would have to pay around £10,000 for safe surfaces under play equipment,” he said.

Llandovery and eight other town and community councils have so far turned down the chance to take over parks and playgrounds under the county council’s asset transfer programme. Discussing the matter at a meeting on Monday, members of the Executive Board agreed to try and re-engage these councils in discussions to see if ways forward can be negotiated.

Mr Carter was not optimistic. “I can’t see a negotiated way ahead if there is a cost to the town council,” he said.

Llandovery’s big recreation area at Castle Fields, where the annual Sheep Festival is held, has found a group willing to take it over. The Llandovery Community Sports Association, created by Llanwrda Cricket Club, Llandovery College, Llandovery Junior Football Club and Llandovery Association Football Club, agreed to take on the field and in return the association receives two years’ worth of maintenance costs and a grant of up to £10,000 for improvements.

But with both the county council and town council anxious to avoid the costs of ownership, the future prospects for the three playgrounds and the skate park are much less assured. If no deal is done, the land could be sold.

Impasse: Castle Fields Playground, Llandovery, plus the Skate Park and two other playgrounds, are threatened because the county council wants to transfer them to the town council, which says it just cannot afford to take them on.

Central Procurement Plans Labelled “Absolute Abomination”

It is an “absolute abomination”, declared Cllr Pam Palmer.

The object of her ire is the innocently named Welsh Procurement Policy, which the Welsh Government has put out for consultation.

Cllr Palmer (Independent, Abergwili, and joint Deputy Leader) told other members of Carmarthenshire County Council’s Executive Board, meeting on Monday June 20th, that the policy, focused on a National Procurement Service (NPS), would raise procurement costs and could damage the council’s efforts to increase local employment.

Cllr Dai Jenkins (Plaid Cymru, Glanaman, joint Deputy Leader) was just as incandescent. The new policy could have an adverse impact on Carmarthenshire’s regeneration strategy, he said, stressing that “it will take freedom from local authorities and impose costs.”

The additional expense includes a levy of 0.45% on all spending on contracts awarded under the NPS, which has cost £5.9 million to set up.

The strongly-worded consultation response approved by the Executive Board was particularly damning about the prospect of central contracts which local authorities and public bodies would be obliged to accept.

“This proposal represents a major threat to our local economy in South West Wales and how we currently link up with SMEs (small and medium enterprises) who are often very well placed to provide a quality service at a competitive price in a highly sustainable way and often with opportunities to deliver genuine valued community benefits,” said the response document.

In contrast, centrally negotiated contracts could be more expensive. “There is evidence that framework prices in relation to consultancy under NPS are significantly more expensive than our existing contracts,” the response says. “A requirement to use NPS contracts is unacceptable and takes away the democratic role of unitary authorities and elected county councillors. Also the imposition of an additional 0.45% levy just adds to the unfairness in mandating that NPS contracts would have to be utilised.”

The Welsh Government’s big idea for central procurement is intended to increase fairness and transparency, and minimise the scope for local collusion between purchasers and sellers, but if the policy is brought in without major amendments, small businesses would be disadvantaged. In addition, public bodies would lose autonomy over which suppliers to select, while paying for the dubious privilege through the levy.

And any policy which privileges corporations large enough to take on central contracts is likely to damage small enterprises which may be very important in, and to, their own communities.

PDR

‘Wellness Centre’ to Worsen Financial Starvation?

Part 2

Excited talk of a £60 million ‘Wellness Cente’ for somewhere on the outskirts of Llanelli suggests that another white elephant could be about to take up residence in Carmarthenshire.

Surely THE RETENTION OF OUR REMAINING PUBLIC SERVICES would be far more cost-effective than an expensive new building?

The Wales Audit Office expresses similar concerns in a new report, ‘Supporting the Independence of Older People: Are Councils Doing Enough?’, released on October 15^th.

The report says that cuts to those public services which help people to live independent lives “may prove to be a false economy for the taxpayer as cuts to preventative services can often result in more demand for more costly acute health and social services in the medium term”. (p.11)

According to the Audit Office, “Seven of 10 services rated as most important by older people and four of the top five services that support them to live independently, have been reduced  – community halls (41 per cent), public toilets (26.8 per cent), libraries (18.7 per cent) and public transport (5.7 per cent).

“Whilst we acknowledge the challenge councils face in having to reduce expenditure to balance budgets, the effect of these cuts is going to impact adversely on older people.” (p.11)

And that is likely to lead to greater demand for expensive personal care as older people, denied easy access to transport, toilets and social activities, become more isolated and less independent.

“There is a risk,” says the Audit Office (p.59) “that council are changing services without fully assessing the potential impact on older people which undermines their ability to fully meet the Public Sector Equality Duty.”

This duty, explained in the Equality Act 2010, is to ensure absence of discrimination on the basis of age, disability, gender reassignment, race, religion or belief, sex, sexual orientation, marriage or civil partnership, pregnancy or maternity.

The important services which “most councils” fail to evaluate adequately, according to the Audit Office (p.20), include toilets, libraries, halls, specialist housing, housing adaptations, warden-assisted housing, alarm services, and practical help with things like shopping, cooking and gardening.

Given the importance of easily accessible local services to help keep older people independent, and councils’ records of closing those services, there is a strong case for avoiding swanky new buildings  – even ‘Wellness Centres’ – and concentrating on keeping bus routes and public toilets open, and on providing enough practical help so that older people can live as they want to live.

The Wales Audit Office found in a survey carried out between October 2014 and March 2015 that 56% of people said public toilets are very important, and another 30% said they are important. The figures for libraries were almost as high – 54% voting them very important and 29% important.

How many would say the same about a ‘Wellness Centre’?

Unfortunately, it’s not a simple case of either / or, because keeping services going requires revenue funding, which the UK government keeps cutting, and new buildings need capital funding, which is still obtainable through grants and loans. So it is easier to build a ‘Wellness Centre’ than to keep public toilets open – or to keep the Wellness Centre open in 10, 15 years’ time!

And that is a perplexing problem, a problem the Audit Office cannot solve, not on its own at any rate.

PDR

East Gate Subsidies to Help Generate Profits for Standard Life

East Gate, the leisure/retail/commercial development in Llanelli in which Carmarthenshire County Council was a partner with Henry Davidson Developments, has been sold to Ignis UK Property Fund for £14 million.

The county council’s share of the proceeds is £0, zero.

Press officer Ron Cant explained that the council’s aim had been to secure the redevelopment of the run-down site, a search that had taken years until Henry Davidson came along, ready to be persuaded to take on the £15 million project.

Final planning approval was given in February 2011, and work was quickly under way. Jonathan Fearn, the council’s head of corporate property, was quoted in the Llanelli Star[i] as saying that, by November 2012, financial support by the council for the scheme amounted to £3.4 million.

Ongoing commitments include rent of £100,000 a year for the car park, and rent currently £250,000 a year, for the 20-year agreement to take the 1,989 square metres of office space in the Landmark Building, which works out at nearly £126 a square metre.

This is a big premium over typical Swansea Bay rents for modern offices. Examples today include £91.51 a square metre for 371 square metres in Dafen, £91.62 per square metre for 461 square metres in Swansea, and £98.44 a square metre for 64 square metres in Gorseinon. The council is now advertising to sub-let the office space at £12.50 a square foot, which is £134.55 a square metre, an even greater premium above the typical local rate.

Apparently the council committed to renting the offices, large enough for about 200 staff, to ensure that the development went ahead, and that Llanelli would become another hub for international brand names like Costa Coffee, Nando’s and Odeon. The Scarlets rugby region is there too, with a shop and café, the fitting of which was paid for, indirectly, by the people of Carmarthenshire. Henry Davidson Developments lent the Scarlets £280,000 for the fitting out of the premises, and the loan was repaid with £280,000 from the £850,000 proceeds of selling part of the Scarlets’ car park to the pub chain Marstons. The proceeds should have been shared between the county council – the landowner – and the Scarlets, but after the Scarlets claimed for the costs of fees and expenses, including the repayment of the £280,000 for kitting out a shop nowhere near the stadium in Trostre, the council received only £200,000.[ii] In the end, the argument that East Gate needed the Scarlets’ shop to increase footfall, and thus to help attract tenants to vacant units, was given greater weight than the fairness argument for an equal distribution of the land sale price.

Scarlets Regional Ltd, which already owed £2.616 million to the county council, has not yet filed accounts for 2012-13, and is late doing so. The accounts should have been filed by March 31^st 2014, which was a month after the company’s auditor resigned on February 27^th 2014.

Meanwhile, Ignis UK Property Fund, proud new owner of East Gate, is itself part of a change of ownership. Ignis UK Property is part of Ignis Asset Management, which has been owned ultimately by Jersey-based Phoenix Group Holdings. In a deal in March 2014, Phoenix agreed to sell Ignis Asset Management for £390 million to Standard Life Investments, part of Edinburgh-based Standard Life plc.

Profits from the East Gate development should in future go to shareholders in Standard Life. They will not flow to the people of Carmarthenshire. As in the asymmetrical Scarlets arrangement, the council, representing the residents, is subsidising the private sector — but there is no matching requirement for a share of profits to be returned to the community.

 Pat Dodd Racher

[i] ‘Council defends £5m office rental decision’, by Alana Lewis, www.llanellistar.co.uk, November 28^th 2012.

[ii] ‘Call for investigation into £850,000 land deal between Scarlets rugby region and Carmarthenshire council’, by Martin Shipton, Western Mail, April 23^rd 2014.

Boston Money-Pit Lessons for Carmarthenshire

While Carmarthenshire’s residents are on the hook for Llanelli’s lofty Parc y Scarlets stadium, over on the far side of England, the people of Boston, Lincolnshire, have a salutary tale to tell, about the posh and pricey council-initiated venture, the Princess Royal Sports Arena (PRSA).

Back in June 2001, the Boston Standard was reporting Boston Borough Council’s high hopes for the arena, then in an advanced planning stage. The Finnish timber company Finnforest had agreed to invest £500,000, and the council was awaiting the results of applications for £1 million to the Europrean Union and £800,000 to the National Lottery. Boston Council’s chief executive, Mr Mark James (currently on ‘gardening leave’ from Carmarthenshire County Council) told the Boston Standard that the partners in the venture were in the process of buying the land for the arena. The chair of Boston and District Athletic Club, Beryl Clay, looked forward to hosting national and even international athletics competitions, for both disabled and able-bodied athletes.

Council was Back-Up Funder

The borough council had, in April 1998, endorsed plans for a new sports arena. The plans were developed by the council, Boston Rugby Club, and the Athletic Club, which together created the Disabled and Able-bodied British Sports Initiative, or ‘dabsi’.  The borough council was on hand to provide the necessary cash, should other funding sources fall short. Mr Mark James, at the helm, had joined Boston from the London Boroughs Association as director of corporate services in 1993, and stepped up to chief executive in 1995. He left for the top job in Carmarthenshire in March 2002.

Most of the chequered history of the Princess Royal Sports Arena has affected the post-James Boston – indeed, the arena did not open fully until 2004 — but the tale is relevant to Carmarthenshire, where the council’s ‘vision’ also encompasses a grand — or grandiose — sports development, the Parc y Scarlets.

During 2003, it was clear to readers of the Boston Standard that the sports arena was a money-pit, consuming all the funds thrown at it and always needing more. “Around £600,000 of taxpayers’ money used to build a sports stadium in Boston is still owed to the borough council despite a recent cash injection to reduce the debt”, the paper reported on December 10^th. The council had already lent £1.9 million for the venture, in part paid off with £790,000 from Sport England and £500,000 jointly from Lincolnshire Enterprise and the East Midlands Development Agency.

Criticism by Audit Commission

Insufficient funding for the arena remained a millstone for Boston Borough Council, and triggered an investigation by the Audit Commission, which in June 2007 published a report, stating that “It was envisaged that PRSA would be constructed without the need to borrow funds and once constructed, would break even earning sufficient revenue from activities to cover costs”.

The Audit Commission traced the inception of the arena back to 1997 and to the Boston Sports Forum, of which the borough council was a member. Initially the council proposed investing £3 million in the venture but, said the Audit Commission, “due to rising costs, lower than expected contributions from others and a resultant deficit for each year since opening the Council has ended up providing significant additional financial support than first envisaged”. It was concern about the deficits which had led to members of the public asking the Audit Commission to investigate.

The commission found that:

“The full extent of the financial exposure of the Council should have been more clearly identified in reports to members (councillors) when decisions on granting additional funding were made, especially with regards to revenue ‘operating’ support and interest charges.

“Whilst the Council considered the wider outcomes for the community which would arise from its contribution to the project, these need to be much more explicitly set out as targets and performance monitored against them in order for the Council to assess the success and overall value for money from its contribution.”

In other words, the councillors were not given sufficient information on which to make sound judgements.

When councillors were considering the appointment of external advisers, or extensions to contracts, the information before them “should have usefully contained more financial information”, the Audit Commission stated. In addition, “ the interaction of the Council’s governance arrangements with those of BSI (Boston Sports Initiative, the charity running the arena) have not always been clear”. The Audit Commission found two instances of the borough council entering into contracts for a period of months before they were transferred to BSI, during which time there was no trace of any approval by the councillors.

In future, said the Audit Commission, councillors must be given full contract details even when the decision has been delegated to officers, and when existing contracts are being extended, councillors have to be told both the contract cost to date, and the expected future cost.

Efforts to increase revenues from the arena were stymied by restrictive clauses in initial contracts. Sole catering rights for the site were granted to Boston Rugby Club when the council purchased the land, the Boston Standard reported on July 18^th 2007. The payment for those rights, and for the club’s use of the pitch and its clubhouse, was too low, in fact “barely sufficient to cover the basic costs of grounds maintenance”, according to Boston Sports Initiative.

Ejection of Press and Public

The Audit Commission’s report contained information new to the local media. “Much of this information was not available to the public at the time, with the press routinely being ejected from council meetings whenever the PRSA came up for discussion under the pretext that ‘commercially sensitive’ matters were to be discussed,” the Boston Standard commented.

At the beginning, Mark James “led the planning of the project”, the Standard noted, adding that he was “involved in the appointment of Crescent Marketing as external advisers and fundraisers, and PGA Management as project managers”. However, Crescent Marketing did not raise as many funds as anticipated, and in the Audit Commission’s view made a “grossly inaccurate” prediction of future revenues to be achieved by the arena. As for PGA Management, the Audit Commission could not find any evidence that councillors had agreed to appoint the firm.

Posh and pricey: Boston’s Princess Royal Sports Arena (Photo from Boston Target, May 24th 2013)

BSI, the Boston Sports Initiative managing the PRSA, was in 2007 claiming compensation from PGA Management, alleging weak project management.

Acrimony

Acrimony over the arena grew. The Lincolnshire Echo reported in September 2008 that Boston and District Athletic Club, one of the original backers of the project, had withheld rent payments for over a year, in protest at Boston Sports Initiative’s refusal to offer a permanent lease.  The club was evicted late in 2008, thus depriving the PRSA of a potential revenue stream, and leaving it with a redundant athletics track.

By 2013, the arena was in need of urgent repairs (despite having been open for less than a decade). Boston Borough Council even considered closing it. There were problems with the lease. The Boston Target said in May 2013 that, according to the council’s chief executive Richard Harbord, “the original agreement was a 125-year lease with Boston Sports Initiative but, in fact, that lease was never entered into. What was entered into was a series of funding agreements. I can’t help saying perhaps the project was a little over-ambitious for a council the size of Boston. When it was initiated it became obvious fairly quickly it was not going to be straight forward.”

No lease, no agreement over responsibility for repairs! The backlog of repairs amounted to some £200,000.

In 2012 the council agreed to write off £2,059,820 in loans to the arena, which by May 2013 had cost the authority £6,239,298 in capital expenditures and £2,522,000 in contributions to operating costs — a total exceeding £8.76 million.

Elected Councillors to Blame for their Inadequate Information?

The error-strewn history of the arena is surely a serious reflection of the way in which the rules on commercial confidentiality are applied – or misapplied. Elected councillors are not given sufficient information on which to interrogate past decisions, or to make new decisions. This deficiency applies just as much to Carmarthenshire as to Boston, and probably to local authorities all over England and Wales. Councillors are at fault, just as much or more than officers, because they have often delegated their powers to officers far too readily.

After all, what is the point of elected councillors if they can transfer, to the employed officers, their responsibilities for prudent public spending?

Pat Dodd Racher

‘Sponsors boost for world-first stadium’, Boston Standard, June 21st 2001

‘Council is still owned £600,000 for stadium’, Boston Standard December 10th 2003

Princess Royal Sports Arena, Boston Borough Council, Audit Commission report June 2007

‘PRSA errors will not be repeated’, Boston Standard July 18th 2007

‘Athletics club’s closure threat’, Lincolnshire Echo, September 10th 2008

‘Plug pulled on leisure centre revamp’, Lincolnshire Echo, March 9th 2011

Boston Sports Initiative report of trustees and financial statements for year ended March 31st 2013

‘Future brighter for Princess Royal Sports Arena in Boston’, Boston Target, May 24th 2013

Xcel Xamination: spending public money the best possible way?

£1.35 million is £7.37 for every man, woman and child living in Carmarthenshire. That’s approximately  the value of the land and money that the county council has so far provided to Towy Community Church  for the Xcel bowling alley development in Johnstown.  This is made up of £335,000 in grants, a £270,000 loan, and about £750,000 representing the value of the site.

The £750,000  is the money foregone by granting two 99-year leases to the church, at peppercorn rents, instead of selling the two-and-a-half acre site at its commercial value. The figure is included in a report to the council’s Executive Board dated December 7^th 2011.

Ninety nine years is a long time to commit to peppercorn rents.

Sources of capital funding for Xcel phase 1, from the annual accounts of Towy Community Church, and from report to Carmarthenshire County Council Executive Board, December 7th 2011  

The project cost for phase 1 (bowling alley, furniture recycling and food bank) as reported to the Executive Board, excluding the land, was £2.778 million – capital costs of almost £1.971 million and revenue costs of £807,320.

It is too soon to see if the church is on track to meet its agreed contributions to revenue funding of £310,643 in the first two years of trading, or if volunteers gave the £119,864-worth of time promised,  because Xcel opened only in June 2013.

As for the county council’s commitment, apart from the exceedingly generous terms of the leases, the total in grants so far, for phase 1, is about £335,000 (see the chart, above), plus a loan of £270,000. Phase 2 has not entered the funding arena yet, but would include a 600-seat auditorium, a café, luncheon club, debt counselling centre and offices. The December 2011 report to the Executive Board said that phase 2 must be started within five years “or the property reverts back to the council”.

The £270,000 loan is interesting because it replaced a commercial bank loan that did not materialise, and the council has scant security for it, only a 3^rd charge on the lease, in a queue after the bank which lent £300,000 and the National Lottery’s Big Lottery Community Asset Transfer Fund, the supplier of £500,000 for capital costs as well as £300,000 for revenue funding.

So as well as giving 99-leases at peppercorn rents, the council might have to redouble its generosity in the future — it could well lose its rights to recover the land if the bank and the National Lottery – let alone Her Majesty’s Revenue and Customs – need to make claims on Xcel.

To be able to make the loan, the Executive Board agreed a major change in the council’s Treasury Management Policy, which allowed loans to be made for up to three years only, because the £270,000 has been issued for 15 years. The interest rate is 2.5 percentage points above base rate (thus 3.0% currently).

The report to the Executive Board contains a troubling sentence: “Profits from use of the property can only be used for alternative community activities approved by the council or any surplus is payable as rent to the council”.  This is troubling because ‘community activities’ do not usually generate profits – indeed, the council is cutting community activities all over the place  because of their costs – and in my usual world of small and medium-sized enterprises, if there are no profits, loans cannot be repaid, and the enterprise is not sustainable.

The Xcel deals between Towy Community Church and Carmarthenshire County Council surely benefit the church more than the council, but the main question is about the wisdom of channelling so much money into a single project when the community activities in phase 1, furniture recycling and food bank, could be supported at lower cost using existing buildings in the county.

Pat Dodd Racher

Cutting Capital Spending would Damage ‘Vision’ in Cash-Strapped Carmarthenshire

Council Keeps on Spending but Slashes Services

Vision or illusion? ‘Vision’ characterises Carmarthenshire County Council, according to leader Kevin Madge (Labour, Garnant) and also to Labour colleague Anthony Jones (Llandybie). Both backed the council’s capital building programme, Cllr Madge exclaiming that it created jobs, he was proud of regeneration, he must thank the council’s officers for all their hard work, etc.

Cllr Anthony Jones referred to “aspirational projects”, vital to prevent Carmarthenshire from stagnating. “We tell officers to bring us projects,” he said during Wednesday’s meeting to set the 2014-15 budget. The projects were on the shelf, ready to be started whenever capital funding was available.

Cllrs Madge and Jones, and the rest of the Labour-Independent administration, refused to support an alternative plan put forward by the Plaid Cymu group, the largest on the council. Cllr Madge protested that the alternative budget would mean a reduction in the capital programme, which would never do. While the administration has ‘vision’, Plaid Cymru had none, he said.

Conflating ‘vision’ with capital expenditure has misled Labour and Independent councillors into backing such money-pit projects as Garnant Golf Course, Parc y Scarlets, and probably Llanelli’s East Gate, in my opinion. More of the same type of ‘vision’ would surely bankrupt the council. Already, commented Cllr Sian Caiach (People First, Hengoed), interest on loans costs the council some £16 million a year.

You could protect a lot of services with £16 million a year, in fact the council would not need to make any of the £31 million cuts it identified for the three years 2014-15 to 2016-17.

Capital spending over the next five years, excluding the housing programme, should be £270 million, said Cllr Jeff Edmunds (Labour, Bigyn), presenting the budget. Some £170 million would be coming from outside sources, meaning the council itself has to find £100 million.

Meanwhile, council tax is rising by 4.77%, £4.77 in every £100. There’s a lot more pain besides, including less money for the Welsh language, a lot less for road repairs, higher charges for using council-owned sports and leisure premises, new charges for evening and Sunday parking, and on and on: Y Cneifiwr has compiled a long list.

Cllr David Jenkins (Plaid Cymru, Glanaman) pointed out that the council was not obliged to have a capital building programme, that some capital programmes were inessential, and that some of the property portfolio could be sold to raise money. But, in the view of the Labour-Independent majority, such proposals merely displayed a lack of vision.

Plaid Cymru’s alternative budget was, predictably, rejected.

As for vision, a focus on good-value public services  would be more appropriate in hard times than visions – or illusions — of shiny construction developments, in my view .

Pat Dodd Racher