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.
No doubt it’ll keep getting delayed untill they find a way to bury it…
I also hope copy makes its way to the Police!
Me too, Rostrum.
You can make numbers on a spreadsheet say whatever you want. Councillors and Brighton council staff, most with no private sector commercial experience, believed an overly optimistic business case.
Those evaluating the business case and making the decision to gamble taxpayers money on it, our money on it, didn’t need business skills to see the issue. All they needed to realise was that private sector investors had decided not to put their own money into this. That tells you all you need to know.
Yes, no doubt they’ll try 🤦♀️ We now need full transparency on the £65m proposal for the King Alfred which seems a ridiculous amount for a reduced capacity, ugly, ill planned, container ship designed monstrosity!
This is why a borrow on this scale should be supported by a referendum to give local taxpayers a chance to have their say. This is essential, since it is the local taxpayers who will pick up the tab via increased rates.
That is the most important lesson to be learned.
We must have a new law on this so local people can voice their thoughts, much like the Swiss system.
And some people think the Greens should be in charge of the country. No doubt Kitcat will use the expertise from his training course to guide them.
Government,,, Nothing works and no-one cares and when something does work no-one knows why.
Can anyone request a £36m loan from the PWLB to build a private attraction on a publicly-owned seafront with no viable business plan or just Marks Barfield? Is Julie Barfield liable to pay back a penny of the debt, or just we residents who never asked or voted for the i360?
What lessons have been learned and how can BH council demonstrate they have actually learned them?
This is particularly pertinent since BH Council have recently showcased “ambitious” plans to redevelop our entire Brighton and Hove seafront via their unelected Seafront Development Board, who were originally supposed to be for advisory purposes only, but seem to have taken it upon themselves to commission an entire “masterplan” of what they think should happen on our seafront and seem set on trying to make this a reality, over and above what we were told their remit was.
You can make numbers on a spreadsheet say whatever you want. Councillors and Brighton council staff, most with no private sector commercial experience, believed an overly optimistic business case.
Those evaluating the business case and making the decision to gamble taxpayers money on it, our money on it, didn’t need business skills to see the issue. All they needed to realise was that private sector investors had decided not to put their own money into this. That tells you all you need to know.
How they sneered.. ridiculed every point we made.
“You’re just being negative”, they said. “Moaners”, they called us.
“Do you really think people far more qualified than you haven’t already looked into this?” they smugly informed us. The loudest defenders weren’t those with a vested interest, but those gullible enough to mistake PR for truth.
History is about to repeat itself with the King Alfred debacle-in-waiting and £11m already frittered away on gaffe-packed plans from architects who don’t seem to have a clue where the King Alfred is, let alone have visited it to at least get the road names right, so what lessons have been learned? Green or Red, we appear to see the same contempt for other peoples’ money and allergy to financial due diligence. Not a matter of choice, but a legal obligation. At least the interim Chief Financial Officer John Hooton has gone, under whose rein the King Alfred redevelopment jumped from £47m – £65m. Let’s hope new 151 Officer, Elizabeth Griffiths, can investigate and restore some much needed sanity to the spending and borrowing spree.
Wonder what Pete West wants to hide?