i360 report leads to heated exchanges

A “lessons learnt” report about Brighton and Hove City Council’s decision to broker a £36 million loan for the i360 will go before councillors for debate in September.

Labour councillor Josh Guilmant described the delay in bringing the report before the Audit, Standards and General Purposes Committee as “shameful” at a meeting of the committee yesterday (Tuesday 24 June).

He told members that given the scale of the financial impact of the loan and the level of public interest, the report needed to be discussed openly.

Councillor Guilmant said: “This feels exactly the sort of matter we should be examining transparently here so residents can see what lessons have been identified and what changes can be made as a result.

“For this committee not to debate the CIPFA (Chartered Institute of Public Finance and Accountancy) report in public would be shameful.”

Councillor West, who chairs the committee, said that “shameful” was a strong word but, after taking advice, accepted the report for the September agenda.

He said: “My disappointment is that the report was published prematurely. It wasn’t completed because I think it’s important that this committee considers completed, honest and open proper documents and not those that are not up to our standards.”

The independent report from CIPFA had been expected to go before the committee in April, but Councillor West rejected it as “incomplete”.

Before the April meeting, he said that he had raised his concerns about “thoroughness and accuracy” with the CIPFA author at the “draft” stage.

One of his concerns was that the report was written without contacting those involved in the original decision to broker the £36 million loan from the Public Works Loan Board to the i360 developer Marks Barfield.

The council has never owned the seafront tourist attraction but brokered the loan as part of a wider effort to revive the seafront near the West Pier and strengthen the A259 seafront road.

The i360 ceased trading in December 2024 when the company that owned the seafront tower filed for administration, leaving more than 100 people jobless just before Christmas.

The total debt owed to the council by the i360 had gone up to £51 million, including interest, by the time the company went bust.

The council wrote off the outstanding amount early last year and is repaying the Public Works Loan Board about £2.2 million a year until 2041.

The write-off enabled the administrators, from Interpath Limited, to sell the business to leisure operator Nightcap for £150,000. No buyer would take on the business with the debt still owing.

The CIPFA report said that the council agreed the loan at a time when councils were being encouraged to “think commercially” and borrow at low interest rates from the Public Works Loan Board.

The report said that the council was sold “over-ambitious” projections of visitor numbers, revenues and profits.

The council kept the business case secret from the public when it decided to approve the £36 million loan to Marks Barfield, citing commercial confidentiality.

The secrecy was criticised at the time as a figleaf to cover up the figures behind a bad decision – and it has been the subject of considerable criticism since then for the same reason.

When the terms of the loan were agreed in 2014, the minority Green administration voted through the proposals with support from some though not all of the opposition Conservative group.

But the Labour group – the smallest party at the time – voted against the loan.

In May last year, Nightcap said that it would honour the condition attached to the i360’s planning permission that 1 per cent of ticket sales should be paid to the council.

The new owner has focused its efforts on making the i360 a welcoming destination, with trips up the 531ft (162m) viewing tower still a part of the attraction but not so central to the business plan.