Rob Stewart: “public will shoot us” if scheme is dropped.
THE leader of Swansea Council has fended off accusations that a £130 million city centre project might not be affordable, saying that the “public will shoot us” if the scheme was dropped.
Rob Stewart was questioned about the new indoor arena, commercial units, flats and multi-storey car parks which comprise phase one of the Swansea Central scheme.
Councillors on a scrutiny panel wanted to know more about the risks involved, given that a cabinet report has warned of “catastrophic” consequences if the worst came to the worst.
As things currently stand the council is responsible for funding the regeneration project, but it is expecting central Government contributions to be confirmed shortly as well as benefiting from new income streams once it is completed.
Councillor Stewart was asked by a member of the public at the meeting why the finances had not been made clear to residents.
The man, Colin John, asked: “Why the secrecy?”
Cllr Stewart rejected the charge, saying a series of council reports had been made public about Swansea Central.
He added that capital spending on phase one of the scheme would have “no direct impact on revenue and services over the term of this council”.
The current term ends in 2022.
Cllr Stewart said: “I think the public will shoot us if we had come this far and then decided not to do it.”
Mr John then said: “The public don’t have a clue what it’s going to cost us. Can we afford it?”
Cllr Stewart said: “Doing nothing will not improve the city centre — in fact it will take it the other way. It is the worst thing we could possibly do.”
Opposition leader, councillor Chris Holley, said nobody wanted to see Swansea not develop, but he cited a line in the cabinet report which said there was a risk that the council did not have sufficient resources to complete Swansea Central phase one.
If this came to pass, said the report, a notice effectively banning the council from all new expenditure “would be inevitable and the reputational and financial consequences catastrophic”.
This scenario hit the headlines during the summer when cash-strapped Northampton Council was served with such a notice.
Cllr Stewart said: “We are not in a Northampton position. We are not looking at intervention from Government, or being a failed council.”
He also asked what Cllr Holley would do instead.
“If you believe there is a different scheme, I’m yet to hear about it,” said the Labour leader. “I have not heard any alternatives.”
The council’s property development manager Huw Mowbray told the scrutiny panel that local companies would benefit from Swansea Central construction contracts.
He added: “I am confident that we will be delivering (the scheme) on time and budget.”
Chief finance officer Ben Smith said he had to consider the “glass empty” scenario, and added: “I am concerned about the overall scale but I agree that there is always a reason to do nothing for fear of the future.”
He said that given the decisions already made by cabinet and council, in particular the approval of a £200 million borrowing “envelope” for various projects, that the scheme was affordable.
He added: “It will require some difficult decisions to be taken.”
Cllr Stewart said £200 million sounded “scary”, but that proposals were being developed to make sure the council had sufficient funds to cover capital financing charges.
Mr Smith said more “capital resource” was being made available by the Welsh Government, which was likely to reduce the £200 million envelope.
The discussion moved to the city deal for the region, and when funding would actually materialise from the Welsh and UK Governments.
Cllr Stewart said he expected these administrations to release £16.1 million per year for 15 years, which would be made available to city deal projects whose business cases had been signed off.
He said the city deal had been needed because Swansea and the wider region was not as productive as other parts of Wales and the UK.
Councillor Jeff Jones said: “We were told it (city deal funding) was going to be June, then October, and now we are being told it’s imminent.”
Cllr Stewart said: “My understanding is that it will be very early in December.”