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Labour: dealing with i360 debts is a distraction from Covid
Posted On 25 Jun 2020 at 12:53 pm
British Airways i360
A leading councillor has slammed those responsible offering a £36 million loan for the i360, calling the attraction a “doughnut on a stick”.
Labour councillor Daniel Yates criticised the former Green administration and Conservative councillors for the decision which he says has put a strain on Brighton and Hove City Council finances.
He made his comments as Green members of the authority’s Policy and Resources Recovery Committee attempted to change recommendations by the i360 working group to defer the loan payments for June and December this year.
Green members wanted to keep the December payment option open.
The committee voted to allow the seafront attraction to defer both its loan payments for this year, as it lost out on the start of the tourist season when it shut in March.
Councillor Yates said the Green Party had welcomed the i360 “so much they were willing to invest tens of millions of pounds of public money into it”.
But they would not accept the findings of a cross-party working group set up this month to liaise with the tourist attraction’s directors, which recommended deferring both this year’s payments.
During the virtual meeting on Wednesday 24 June, he said: “This is another attempt by the Greens to try to wash their hands of their responsibility.
“As a council, we have been the most affected council in the south-east of England by Covid.
“The last thing we need is having to deal with a doughnut on a stick and having to spend all our time dealing with the debts associated with former Green and former Tory councillors.
“It would be lovely to be moving on from this.”
Green group convenor councillor Phélim Mac Cafferty said he wanted to see decision making around the i360 “turbocharged” by deferring the loan in June only, and called for a report from the i360 working group about the timescale and financial risk around the loan.
The seafront attraction’s board is repaying the £36 million Public Works Loan Board loan, which was underwritten by the council.
It has made £5.9million in repayments and deferred £4.1 million on the loan which with interest has increased to £38.9 million.
Chair of the i360 working group, Labour councillor Carmen Appich said: “The attraction has been closed since 19 March, with most staff furloughed.
“This, combined with the storms earlier in the year, has resulted in a significant loss of income, with negative cash flows in the early months of the year.
“The latest projections, assuming a reopening with safe distancing from 4 July, which has been confirmed by the latest government announcements, shows that the attraction can begin to become profitable once again.
“The assumption is that many people will opt for a ‘staycation’ rather than travel abroad this summer, and come and visit Brighton and Hove once our restaurants, pubs, hotels and visitor attractions open.”
Councillor Appich pointed out despite people’s misgivings, the i360 exists and does contribute to the city economy.
Conservative group leader Steve Bell questioned whether how much of a contribution the attraction has made.
He said: “We have always given our support to the firm, not that we agreed with the business plans or what the i360 have done, but because of the overriding financial catastrophe it would be for us as a council if we were to use our ‘step in’ rights.
“However, it has always been, in my opinion, not an if we step in, but when we need to step in.
“I do think it is speculation rather than fact what the i360 has contributed to the economics of the city.”
Councillor Bell asked for verification of the financial impact with real figures rather than speculation.
A report before the committee stated the i360 has contributed £89.6 million to the city economy.
It said once the loan is paid off, the attraction will have contributed £640 million to the city economy, representing £15.90 for every £1 of public sector investment.
It has provided income for landscaping the area around it and contributed towards the refurbishment of Madeira Terraces and festoon lighting along the seafront.
Once it reopens in July, any cash over and above that necessary to retain a strong cashflow position is paid to the council.
The council is due to receive one per cent of ticket sales in perpetuity to spend on local initiatives.
The Council actually borrowed and spent more money on the Landscaping which was meant to come out of the £960,000 a yesr dividend.When Brighton i360 Holdings Ltd get to owe more than it cost to build what will happen then.What is its amortisation value?
Why has Cllr Shanks never been asked how she feels now,as She was a member of the Committee and one of the only remaining Cllrs along with Cllr Littman?
Also has anyone contacted Jason Kitcat and Penny Thomson for their views?
Hundreds of people commented on both this website and that of The Argus with their views that it would become a white Elephant and a very expensive one at that.
Surely when this amount of money and any other more than £5m needs to be borrowed it should go before Full Council.
The money already paid & owed is only the interest on loans – not loan repayment (which is not due for many years yet to come). Sober up and cut losses fast! Lee Wares is right. Dan Yates too.
For the i360 to claim they are in strife due to covid is laughable
They were in trouble for two years before Covid
What no one is doing is actually finding out what is really going on on the ground so to speak
They now owe £4m by end of this year so they need to make an extra £4m in the next year when they are already failing so that’s not likely
What is never mentioned is that the i360 has until now a number of money making elements to their Brighton attraction
1 . The lid rises
2. The souvenirs shop
3. The restaurant
4. The tea room
5. The highest earner, the events rooms hired out for weddings, parties, etc that had a beautiful sea view
However what has not been made public is that the i360 has sold off the events space and all its earnings to an event company who previously only supplied food for events . They also sold off the restaurant also to them. The events staff Turned up for work a year ago and were told that they no longer worked for i360/British airways but for the events company Sodexo
So basically apart from room hire the only thing the i360 earn money from are now pod rides, souvenirs shop and tea room that’s always empty
There is no way they now can ever repay the loan or interest or money owed
This was a case of selling off the family jewels in desperation to keep afloat a bit longer …
So last summer in another panic idea they installed garden sheds with street food as a new little earner . They didn’t get planning consent
They also created a new outdoor portable bar to earn more
So we roll on again …
British airways sponsorship is nearly over and it’s unlikely they will renew as they are also failing miserably with a shocking reputation of mistreating staff . So that’s another nail in the coffin
Staff at the i360 gave all been told they are all going to be made redundant in November and 30% of them can apply for their jobs with worse pay and contracts . Just as they are doing to all BA staff Gatwick and Heathrow
Yet they still claim they are helping the community. They partner up with big names only and their neighbouring businesses they try to Oyt do. They are not in the least but helping locals. They have competed with products and food outlets thus damaging their neighbours
This year they have another ice cream van, competing with small ice cream parlours directly next to them on both sides
They gave out up garden shed to the front of the space no doubt again to do street food which also competes with so many seafront restaurants desperately trying to survive
They do not care one but for other seafront traders or their staff.
Quite honestly it amazes me no one highlights any of this
If a £46m or whatever it was brand new one and only tower can’t survive by doing what it intended and got permission and help for and actually ends up selling off most profitable parts of its business and resorts to earning income from garden sheds and a ice cream cans then surely you don’t have to be too bright to see they are disguising the truth and utterly desperate
The time has come for people to open their eyes, find the truth and stop this corporate nonsense of getting away with stuff no other seafront business would
They do nothing for Brighton, this has been shown loud and clear by their silence during covid
While many of us were organising food donations, making ppe, giving Nhs help , opening up their huge spaces for food donations … something, anything and they have done nothing apart from posting twitter, Instagram and Facebook messages to appear cuddly and caring
They’ve done nothing other than flicking a switch to make the lights blue . That for me says it all
At some point there will be a time when people reflect on what big companies who claim philanthropy actually did
They could have helped support their neighbours, not sack their staff, loan out their space to charities
The only charity they understand is the ones that make them appear good with no substance whatsoever
The owners are worried they will have to cough up their own money !
Well like many of us they should also be in the position of not having the luxury of smoke and mirrors and a council whose only reason not to take it back is because they have no idea how to run it making a profit
After all the council don’t want plants on the seafront or anything that needs maintaining so I doubt they have the confidence to make it work
That says it all, even the council don’t see it as profit potential otherwise they would have reclaimed it months ago
Also where does The Wezt Oier Trust stand in all of this and are tge receiving rent and are Business rates being paid?
Interesting.
As residents of this small independent enclave on the south coast of England, we have predominantly voted for both Labour and/or the Green Party for over a good decade now. Now the **** has hit the fan, you’ve got your daggers out against the Green Party. May I be the first of many to tell you that as part of the general public we don’t believe in either of you. The way in which both parties are behaving in this international health crisis is nothing short of diabolical.
For goodness sake, what we as the people who live and/or work here need right now is a party who knows what they are doing and gives us confidence in the decisions they are making. Because you are being led by another party – the conservatives – in central government which you politically do not agree with is not a good enough reason to desert your duties to the people who voted you to stay regardless. We are the people. I am fed up with the bull**** you and the greens are happily delving out. Either run this city properly or **** off. That means equality for all us residents regardless of our skin colour, nationality, gender persuasion, class, finances or other.
We simply want to be able to use the beach safely sometimes. We simply want to be able to walk down the pavements occasionally and not feel we have to give way to others who don’t respect nor believe in the virus or social distancing. We want to be able to walk our dogs once a day without fear of being named and shamed if they are off the lead. We want our children to feel free from time to time in a park or on a Brighton beach without the worry of thousands of people not giving a **** about their or our well-being. The list is endless.
We pay the council tax. So start repaying us back. Or lose us.
A crucial problem that faces it is that there is likely to be an end to the “conference trade” now that it is clear that so many national and international meetings can be held by video. The i360 (dreadful name) was aimed at visitors rather than residents, generally speaking; a reason for those who organise conferences to come here rather than, say, Manchester.
Christopher we were told that 800,000 visitors would come to the City to specifically visit the i360 and when I spoke to both David Marks and Julia Barfield they assured me it would be successful.
Why would Conference visitors make that much of a difference unless it was used every day of the year?
The i360 will never make money. But whilst we have a council willing to throw away 2.4 million in seafront parking a year they will get little sympathy from me.