News release – Newbury Constituency Labour Party

West Berkshire Council in denial over London Road development failure, says Labour

Leading local Labour members have questioned West Berkshire Council over the failure of its project to redevelop the London Road Industrial Estate in Newbury. But senior Conservatives simply reject widespread claims that the Council has wasted millions of taxpayers’ money, misled the public on its performance, and refuses to consult the people on what to do to save the project.

Conservative councillors on the Council executive faced ques­tions before Christmas on the LRIE project, which involved the developer St Modwen Developments. They gave a negative response to all criticisms, namely:

• The Council refuses to admit that it did wrong, although it has been found to have acted unlawfully. The Appeal Court de­clared this the most serious possible breach of public pro­cure­ment law, and it was the first time in this country that a public authority procurement contract has been legally quashed. And it is claimed that if the agree­ment had survived it would have resulted in the Council being liable for much of St Modwen’s commercial risk.
• The Council refuses to allow a public inquiry into what went wrong. Conservative councillors have used their block vote to reject demands for an independent inquiry. If there is any review it will be behind closed doors.
• The Council will not publish documents that it argues are “commercially sensitive” or “legally privileged”. Council­lors argue that all relevant documents have already been put before the courts; which of course means that anything embarrassing can be categorised as legally privileged and not for public exposure.
• The Council will not consult the people about developing new plans to revive the project. Hilary Cole, the Council’s planning executive, says no public consultation will take place “until detailed redevelopment proposals are ready to be put before the planning authority”.

Suzie Ferguson, prospective Labour candidate in next May’s West Berkshire Council election in Pangbourne, says: “This is the story of anything but democracy in action.

“The Council has worked in secret on ill-conceived, unlawful plans, and it’s going to spend a lot more time and taxpayers’ money on more secret planning before it even thinks of asking the local people.

“The cost has been massive, and that will only mean more cuts to front line services for vulnerable people.”

And Lee McDougall, prospective Labour candidate in Tilehurst and Purley, says: “The Council’s failures have caused huge dam­age to Newbury’s economy and society.

• Loss of jobs. Bayer is not the only employer to leave New­bury because of years of delay and uncertainty.
• Loss of investment by developers and other businesses on the estate – because of uncertainty or even fear of eviction.
• And the Council’s decision to close Newbury football ground. is a real threat to health and social wellbeing. It’s wholly unnecessary and undemocratic.”

Background

Redevelopment of the London Road Industrial Estate has been planned for over ten years. Outline plans have featured promin­ently in the Newbury Vision, but the project has had a series of delays over the years.

Now the Council has lost a long legal battle with Newbury-based Faraday Development Ltd.

Faraday owns part of the estate, and was given planning con­sent in May 2009 for a £50m regeneration project. The project was to build a “vibrant and sustainable mixed-use quarter” with a supermarket, 150,000sq ft of office space, a 100-room hotel, residential units, a crèche and care home, as well as community and healthcare facilities. This development was dubbed the Faraday Plaza.

With the application due to expire, Faraday submitted an iden­tic­al renewal application to West Berkshire Council on March 30, 2012. The council should have decided the application within 13 weeks, but finally rejected it in August 2014.

An action group, the Community Representation for Open and Fair Treatment group (CROFT), was formed to represent busi­ness owners and tenants on the estate who would be affected by the development. It raised a petition to voice its dissatisfaction with the lack of information and consultation from the Council.

It also correctly foresaw that delay in the revamp of the area would force Bayer, one of the largest employers in Newbury, to leave the town entirely. Bayer had been approached to move to the estate when the lease on its current Strawberry Hill premises ceased the next year.

March 2015 The Council made proposals for a purchase order to buy two pieces of land required for the A339 junction but wrongly classed this as a confidential item for debate, so press and public would be excluded from any discussions about it. The land was owned by Faraday Development, whose solicitors argued there was absolutely no justification to hold discussions in private.

May 2015 The Council presented the proposal again as confid­en­tial, but Faraday Development’s solicitors forced the Council to withdraw. The company claimed the Council was “withhold­ing vital information from the public”. Council leader Gordon Lundie insisted that the attempt to push the purchase behind closed doors was “nothing more than a minor administrative error”.

July 2015 A Council vote on the purchase order was again can­celled because of a technical error in the plans. It was finally approved at a later meeting, but district councillors who also sit on Newbury Town Council were banned from the debate and from voting, as they were deemed to have a “prejudicial inter­est”. So an important decision on development of Newbury was taken without many of the elected representatives of the people of Newbury present.

August 2015 The Council published a voluntary transparency notice in the Official Journal about the agreement it was negotiating with St Modwen Developments, who have a long track record in delivering large urban regeneration projects. The notice stated that in the development, “The freehold of the land is owned by the Council.” The agreement was an “exempt land transaction” and not a “public works contract”, and so the Council did not need to follow an open procurement procedure.

September 2015 The Council entered into a development agreement with St Modwen. Council leader Gordon Lundie said details of the agreement were unlikely to be made public, as it contained confidential information on how much the developer and the council stood to make from the deal.

However, Faraday disputed the valuation of the land to be pur­chased in the Compulsory Purchase Order (CPO). It also appealed the refusal of its application – and a three-day public hearing subsequently took place so that a government-appointed planning inspector could establish whether or not the appeal should be allowed.

Oct 2015 Bayer announced it was leaving Newbury to offices in Green Park, Reading. It had drawn up a shortlist of six pot­en­tial sites in the town during a four-year search, and the Lon­don Road Industrial Estate was its preferred option. But “un­necessary delays” to the regeneration scheme for the estate meant its current lease had expired and it was forced to move.

Dec 2015 The Council needed to vote for the second time on its compulsory land purchase order because it needed to “revisit” the July decision. This was because it had made a new agree­ment with St Modwen, and the landowner Faraday Develop­ment Lim­ited lodged an appeal. But the debate was deferred again because of another “administration error” when the report presented to councillors was found to be out of date.

Council chief executive Nick Carter called the delay “extreme­ly unfortunate”, but said that the Council was continuing nego­tia­tions with FDL and if agreement could be reached it would mean a CPO was not required.

But Duncan Crook, managing director of Faraday, said in a press release “They should come to us and negotiate because if they negotiate with us we would put the road in for them and it would save the public purse £3m to £4m.

“One wonders in the current times of austerity and cuts why the council is prepared to spend £4m of public money that it doesn’t need to.”

He said if the Council pressed on with a CPO, Faraday would challenge it. “The outcome of the CPO is by no means a fore­gone conclusion and for the council to start working on a road when it doesn’t know whether it will get the land is ridiculous.

Feb 2016 Faraday’s appeal against the rejection of its renewal application in 2014 was upheld by the Government’s planning inspectorate, which declared that a report by Council officers had misled its planning committee. Costs were awarded against the Council. The government inspector accused the Council of “per­versely” misunderstanding or misapplying the legal procedures applicable to the application.

Faraday managing director Duncan Crook said in a press release: “It squarely says in black and white that the council has used the planning system for its own reasons, which is unlawful. There is some­thing very wrong going on at the council which is costing the community dear.”

Nov 2018 The Appeal Court decided that WBC breached pub­lic procurement law in its development agreement with St Mod­wen. The contract was declared ineffective – it was quashed. And the Court judged that the Council published an invalid public notice about the develop­ment agreement.

Notes:

Questions on LRIE were put to the West Berkshire Council Executive committee on Dec 20, 2018 by the following members of Newbury Constituency Labour Party: